The Workmen Compensation Act, 1923 is an enactment that was issued by the tral Government and was implemented by

various State Governments which gives social security to workers. This security is o ered by the law for people who work.

The Act was formed after it was noted that laborers were getting more exposed to danger with the use of advanced and
sophisticated machinery. The common law had it that the employer would only take up the compensation responsibility if it is
found that the industrial accident was a result of his negligence. In India, the issue of compensating workmen after fatal and major
accidents hit the road in 1884. It was then in 1885 that the factory and mining inspectors realized that the Fatal
Accidents Act, 1885, was not enough to attend to the intended purposes.

The State o ered a hearing ear when members of the Legislative Assembly, employers’ representatives, workers and experts
in medicine and insurance formed a committee that gave a report that led to the enacting of the Workmen’s Compensation
Act in 1923.

The passing of the Act put a stop and o ered a relief for workers who would have gone through court processes that are
often expensive, an e ort to seek compensation whenever they acquired an injury during employment.

Aspects of The Workmen Compensation Act

The Act has its basis on two aspects: #
Theory of least cost.
# The production cost shall have the cost of blood and workmen included.

For an industry to run, an employer uses capital, skills in business and the labor of workers who are paid for the labor. The
management has to put aside nances for the possibility of the expense needed to repair the machines when they break
down. If that care and attention can be given to machines, human beings working in the same environment need also receive
care and attention for the risks they undertake when working in that industry.

Social security o ers to ensure compensation is paid to a disabled or injured person only if the accident rose in the middle of the
employment. The compensation paid to a workman by an employer when an accident occurs is a relief and social security
measure provided by the Act. A workman is now able to get compensation regardless of his negligence.

The Act also puts in place the amount that is to be paid according to the intensity of the injury. This makes an employer aware of
the amount of compensation he is liable to pay in case of an accident.

The Act is recognized all over India and applies to all workmen and casual workers in factories, plantations, mines, transport
establishments, railways, ships, circuses, construction work and any other potentially dangerous occupations made mention in
Schedule II of this Act. The Act is not applicable to people in the Armed Forces.

Objective of The Workmen Compensation Act

The Workmen’s Compensation Act of 1923 was formed majorly to give compensations to workmen in the event of an
accident.

The Act has it that employers should have duties and obligations that include the welfare of workers after an injury resulting
from employment in the same way they have reserved the right to make pro ts. The Act aims to see workmen have a
sustainable life after an employment-related accident.

The Royal Commission on Labour made note of the following:

The Act also goes further to ensure the prevention of accidents by giving workmen a relief from anxiety and renders the
industry more friendly and desirable.

It has become a necessity for workmen to be protected due to the increasing complexity of the industry through the
increased use of sophisticated machinery that poses a potential danger to workers and also the possibility of poverty after
injury.

The Act tried as much as possible to curb the chances of disputes which has led to events which are arbitrary. However, the
general outcome is satisfactory since the merits are more than the demerits when it comes to the welfare of workmen.

Scope of the Act:

The Act is applicable only to those workmen working in industries as speci ed in the Act. The Act a ords protection to a
workman from losses or injury caused by accident arising out of and in the course of employment subject to certain
exceptions as laid down in the Act.

Employer’s Liability for Compensation:

To make the employer pay compensation, the death or injury su ered by the workman must be consequence of an ‘accident
arising out of and in the course of his employment’ is dependent upon the following four conditions:
(1) The casual connection between the injury and the accident (i.e., personal injury is caused to workman while on work);
(2) The injury and accident caused during the course of employment;
(3) The probability tenable to reason that the work contributed to the causing of personal injury; and
(4) The applicant proves that it was the work and the resulting strain which contributed to or aggravated the injury.

1. Applicability of the Act:

The Act is applicable throughout India except the State of Jammu & Kashmir. The Act does not apply to those areas which are
covered by the Employees’ State Insurance Act, 1948.

2. The salient features of the Act are as follow s:

I. Extent and Application:
The Act extends to whole of India. It is also applicable to the workman recruited by companies/establishments registered in
India and sent for work abroad.

It applies to:
(a) All railway servants not permanently employed in any administrative, district or sub-divisional o ce of a railway and not
employed in any capacity as is speci ed in Schedule II to the Act;

(b) Persons employed in any such capacity as is speci ed in Schedule II to the Act. Schedule II includes persons employed in
factories, mines, plantations, mechanically propelled vehicles, construction works and certain other hazardous occupations. In all,
there are 48 employments listed in the Schedule; and

(c) Persons employed in employments added to Schedule II by the State Government in exercise of the powers conferred on
them under section 2(3) of the Act. In this connection, a statement indicating the additions made so far by di erent State
Governments is enclosed (Annex-I).

There is no wage limit for coverage under the Act. All the employees employed in Scheduled employment including the
railway servants men tioned at (a) above, are therefore, covered under the Act.

II. Contingencies in which Compensation is Payable:

Compensation is payable in case of temporary/permanent disablement or death as a result of an employment injury. The
contracting of any disease listed in Schedule III to the Act is deemed to be an injury by accident.
III. Occupational Diseases:
If a workman employed in the employment speci ed in Schedule III of the Act contracts any occupational disease peculiar to that
employment he becomes eligible for payment of compensation under the Act.

The occupational diseases should be contracted while in the service of an employer in the speci ed employment. The
Schedule III divides the occupational diseases in three parts, namely Part-A, Part-B and Part-C.

For diseases speci ed in Part-A, there is no qualifying period of employment. In case of diseases speci ed in Part-B, a person
should have been employed in the speci ed employment for a continuous period of not less than six months before the
disease is contracted.

For the diseases speci ed in Part-C, the qualifying period is speci ed by the Central Government. The qualifying period speci ed
for the diseases guring in Part-C of the Schedule is as given below:
(a) Pneumoconioses 7 years
(b) Pagassosis 3 years
(c) Byssionesis 7 years
No qualifying period is required to be speci ed.

Note:
(1) Where the monthly wages of a workman exceed two thou sand rupees, his monthly wages for the purposes of (a) and (b)
above shall be deemed to be two thousand rupees only.
(2) The minimum rates of compensation for permanent disablement and death speci ed in the Act is rupees Sixty thousand and
fty thousand respectively. The maximum amount of compensation works out to about Rs. 2,74,248.00 for permanent
disablement and Rs. 2,28,540.00 for death.

V. Administration:
The Act does not provide for appointment of Inspectors. However, under Section 32 of the Act, the State Governments/Union
Territory Admin istrations have to frame rules to carry out the purposes of the Act.
The rule making power under the Act was originally vested in the Central Govern ment and in exercise of these powers, the
Workmen’s Compensation Rules, 1924 were framed. Some of the State Governments have subsequently farmed their own rules
under the Act.

In this connection, a statement showing the names of the States/UTs, which have so far framed necessary rules under the Act, is
attached (Annex-II). The remaining States/UTs are being reminded to expedite the framing of rules under the Act.

VI. Settlement of Claims under the Act:

The claims for compensation broadly fall in three categories, namely (i) uncontested cases of disablement; (ii) disputed cases of
disablement and (iii) fatal cases. The procedures for settlement of the three types of cases are as given below:
(i) Uncontested Cases:
(a) After a workman has given notice of the accident, the employer is expected to arrange for medical examination of the
workman. It must be free of charge. The medical Examination will indicate the nature of the disablement.
(b) If the disablement is of temporary nature the employer will pay compensation as half monthly payments, direct to the
workmen.
(c) If the disablement is of permanent nature compensation will be paid in lump sum by the employer to the workman if he is a
male over 18 years of age. In the case of woman and minors, the employer will deposit the amount of compensation with the
Com missioner, for disbursement.
(d) Where a workman has agreed to accept and has taken a smaller sum than the amount xed by the Act his right to bring
proceed ings for the balance are protected.
(e) Any agreement with the workman for a lump sum payment must be registered with the Commissioner by the employer.

(ii) Disputed Cases:

(a) If the employer refuses to pay compensation or does not pay the full amount due, the workman has to make an
application to the Commissioner for Workman’s Compensation appointed by the State Government or Union Territory.
The application has to be made in Form ‘F* prescribed under the Workman’s Compensation Rules. An illiterate person can
have the application prepared under the direction of the Commissioner.
(b) A claim for compensation must be preferred before the Commis sioner within 2 years of the occurrence of the accident or in
the case of death within 2 years of the date of death.
In the case of contracting of a disease the accident is deemed to have occurred on the rst of the day during which the
workman was continuously absent in consequence of the disablement caused by the disease.

(iii) Fatal Cases:

(a) The amount of compensation due has to be deposited by the employer with the Commissioner for Workmen’s
Compensation. The Act speci cally provided that no payment made directly by the employer shall be deemed to be a
payment of compensation.
(b) The Commissioner shall distribute the lump sum amount of com pensation to the dependants in such proportion as he
may decide.
(c) If the employer does not deposit the compensation the dependant or dependants have to make an application to the
Commissioner in Form ‘G’ prescribed under the Workmen’s Compensation Rules for the issue of an order to deposit
compensation.

VII. Extension of the provisions of the Workmen’s Compensation Act to Hazardous Employments in Agriculture:
The Workmen’s Compensation Act, 1923 already applies to workers employed in farming by tractors or other contrivances
driven by steam or other mechanical power or electricity etc.

The State Governments of Andhra Pradesh etc. were advised in March, 1976 to consider addition of the following
employments to Schedule-II to the Act in accordance with the provision of sub-Section (3) of Section 2 of the Act:
(i) Employed in clearing of jungles or reclaiming land or ponds in which on any one day of the proceeding twelve months more
than twenty- ve persons have been employed ;
(ii) Employed in cultivation of land or rearing and maintenance of live stock or forest operations or shing in which on any one day
of the proceeding twelve months more than twenty- ve persons have been employed ;
(iii) Employed, otherwise than in cleric. I capacity, in installation, main tenance, repair of pumping equipment used for lifting of
water from wells, tube-wells, ponds, lakes, stream etc.;
(iv) Employed, otherwise than in clerical capacity, in the construction, boring or deepening of an open well/dug well through
mechanical contrivances;
(v) Employed, otherwise than in clerical capacity in the construction, working, repair or maintenance of a bore well, bore-cum-
dug well, tter point etc.;
(vi) Employed in spraying and dusting of insecticides or persticides in agricultural operation/or plantations; (vii)
Employed in working or repair of maintenance of bulldozers, tractors, power tillers etc.

As per available information, the State Governments of Andhra Pradesh, Arunachal Pradesh, Assam, Bihar, Haryana,
Karnataka, Kerala, Maharashtra, Meghalaya, Orissa, Punjab, Tamil Nadu and Tripura and U.T.
Administrations of Chandigarh, Dadra and Nagar Haveli and Pondicherry have already made the proposed additions with e
ect from 15.9.95.

The Central Govern ment has included all the above mentioned employments in Schedule II of the Act by amending the
Schedule. The matter is not, therefore, being pursued further with the remaining States/UTs.

VIII. Last Amendment of the Act in 1995

(a) The provisions of the Workmen’s Compensation Act, 1923, were reviewed by the Law Commission of India (1974) and
(1989). The Commission had made a number of recommendations for amend ment of the Act.
Based on their recommendations and suggestions received from the Ministries/State Governments. The Act has been
amended for carrying out certain amendments.

The amendments made by the Workmen’s Compensation (Amendment) Act, 1995 provides inter-alia for enhancement in the
rate of compensation from 40% to 50% and from 50% to 60% of the monthly wage in the case of death and permanent total
disablement respectively;

(b) The minimum rate of compensation for permanent total disable ment and death have been xed at Rs. 60,000/- and Rs.
50,000/- respectively, as against the previous rates of Rs. 24,000/- and Rs. 20,000/- respectively;

(c) The monthly wage ceiling speci ed in Explanation II under Sec tion 4(1) for working out the maximum amount of
compensation has been enhanced from Rs. 1000/- to Rs. 2000/-. The rate of compensation is linked to the age of the
workman at the time of his disablement or death.

The workers getting disabled/dying at an early age are, therefore entitled to compensation at a comparatively higher rate.
(d) A provision for payment of Rs. 1000/- towards funeral expenses has been made in addition to compensation;

(e) The Act has been made applicable to workmen recruited by Companies registered and based in India and sent for work
abroad;

(f) Sixteen new employments have been added to Schedule-II. In addition to State Governments, the Central Government has
also been empowered to add hazardous employment in Schedule-II.

(g) Three new occupational diseases added to Schedule-Ill. Power to add occupational diseases in Schedule-Ill conferred also
on the Central Govt.

(h) The claimant of compensation may have the claim/petition led/ transferred also before the Commissioner for the area in
which the workman ordinarily resides.

Except this all other provisions of the Workmen’s Compensation (Amendment) Act, 1995 have been brought into force with e
ect from 15.9.1995.

Statement showing the names of States which have framed the Rules under the Workmen’s Compensation Act, 1923.
1. Pondicherry
2. Uttar Pradesh
3. Tamil Nadu
4. Kerala
5. Andhra Pradesh
6. Sikkim
7. Tripura
8. Rajasthan
9. Himachal Pradesh
10. Goa
11. Dadra & Nagar Haveli
12. Daman and Diu
13. Lakshadweep Andaman & Nicobar Karnataka
16. Maharashtra

Conclusion
The Workman Compensation Act, 1923 was formed to provide compensations for workers who acquired/acquire injuries
caused by accidents in the course of employment. It ensure that their rights and value as labourers is maintained. Therefore
employers are obligated to pay compensations to workers who got injuries that led to disablement or even death in the
course of employment.

THE PAYMENT OF WAGES ACT, 1936

[Act No. 4 of 1936]
An Act to regulate the payment of wages to certain classes of employed persons] 1
Whereas it is expedient to regulate the payment of wages to certain classes of persons
employed in industry;
It is hereby enacted as follows:
STATEMENT OF OBJECTS AND REASONS
(i) In 1926 the Government of India addressed Local Governments with a view to as
certain the position with regard to the delays which occurred in the payment of wages to
persons employed in industry, and the practice of imposing fines upon them. The
investigations revealed the existence of abuses in both directions’ and the material collected
was placed before the Royal Commission on Labour which was appointed in 1929. The
commission collected further evidence on the subject ........... The government of India Re-
examined the subject in the light of the commission’s report and in February 1933 a Bill
embodying the conclusions then reached of the Bill to a select committee was tabled during
the Delhi Session of 1933-34, but was not reached, and the Bill lapsed. The present Bill is
based upon the same principles as the original but has been revised throughout in the light
of criticisms received when the original Bill was circulated. Published in Gazette of India,
1935, part V. page 20.
 (ii) Amending Act XXII of 1937.- Section 9 of the payment of wages Act although
reliving the employer from payment to workers who are not present for work appears to
render aim liable to pay wages to persons who although present decline to work. The
explanation is intended to remedy the defect.-See Gaz of India. 1937. Pt.V.p.121.
(iii) Amending Act 68 of 1957.- By the enactment in 1936 for the payment of wages
Act, it was intended to ensure that-
(i) Wages actually disbursable to workers covered by the Act are disbursed within the
prescribed wage-period; and
(ii) employees get their full wages without any deductions which are not specially
authorised by the law.

1. Subs. by Act No. 38 of 1982, vide sec 2, w.e.f. 15-10-1982.

1
 The working of the Act has shown that the Act requires to be amended in certain
respects. It is also considered desirable to extent the benefit of the Act to a larger category
of persons. The important proposals relate to raising the wage limit from Rs. 200 a month to
Rs. 400, Extension of the Act to construction industry and revision of the definition of the
term wages’..............-published in Gazette of India, 1957. Extra, Pt. II, Sec. 2, page 910.
(iv) Amending Act 53 of 1964.- The Payment of Wages Act, 1936, was enacted with a
view to ensuring that wages actually disbursable to workers covered by the Act are
disbursed within the prescribed time-limit and that employees get their full wages without
any deductions not authorised by law. Though the Act has been amended from time to time
and certain major amendments were effected in 1957, the experience of the working of the
Act has revealed certain other difficulties. With a view to removing these difficulties, it is now
proposed.
(a) To widen the coverage of the Act so as to make it applicable to all factories to
which provisions of the Factories Act, 1948, have been extended by the state
Governments;
(b) To include in the definition of ‘industrial establishment’ air transport services other
than allitary, naval and air forces and motor transport services.
(c) To permit deductions from wages of employees on account of grant of advances
for various purposes such-as purchase of cycles or grant of loans for house-
building purposes and ions from labour welfare fund, travelling allowance, etc.;
(d) To provide, as recommended by public Accounts Committee, for the recovery of
losses of the railways due to act of omission or commission on the part of the
employees.
(e) To provide for the fixation of an outer limit for deductions from wages.
(f) To enlarge the powers of Inspectors so as to ensure proper inspection and
better. enforcement of the provisions of the Act, and
(g) to clarify that the jurisdiction of the authorities appointed to hear claim
applications empowers them to decide incidental matters.
These are broadly the main features of the amending Bill. Opportunity has also been
taken to make certain other amendments of a minor character.
The notes on clauses explain the various changes proposed to be made- published in
Gaz. of Ind., 1964, Pt. II. Sec. 2. Extra. P. 393.
2
 (v) Amending Act 29 of 1976.- The payment of wages act 1936 requires the
employers of make timely payment of wages to the persons employed by them. It also
protects the employed person against arbitrary fines being imposed and unauthorised
deductions being made from their wages by the employers.
2. An ordinance to amend the payment of Wages Act. 1936 was promulgated by
the president on the 12th November, 1975 to provide for (i) raising of the wage limit from
Rupees 400 to Rs. 1000 a month, having regard to the present wage levels. (ii).the payment
of wages by cheques subject to the consent of the employed person, and (iii) deductions
from wages to be made with the written authorisation of the employed person for
contribution to the Prime Minister’s National Relief Fund or any other similar fund that may
be specified by the Central Government in the Official Gazette.
3. The Bill seeks to replace the said ordinance- Published in Gaz. if India. 8-1-
1976. Pt. II, S.-2, Ext. P. 201.
(vi) Amending Act 19 of 1977- The payment of Wages Act, 1936. Regulates the
Payment of Wages of certain classes of persons employed in industry. Subsection (2) of
section 7 of the Act provides for certain deductions specified in the subsection from the
wages of an employed person, in accordance with the provisions of the Act.
To promote the welfare of its employees, the Central Government has devised an
insurance scheme to which contributions will be made by the employees concerned. In
order to permit deductions for contributions to that scheme from the wages of the
employees covered by the Payment of Wages Act. 1936. It is proposed to amend sub-
Section (20 of section 7 of the Act suitably.
The bill seeks to achieve the object-Published in Gaz. of India, 20-6-1977. Pt. II, S.2,
Ext., P. 296.
(vii) Amending Act. 38 of 1982 - The Payment of Wages Act. 1936 regulates the

payment of wages to certain classes of employed in industry. It was enacted to ensure that

the wages payable to employees covered by the Act are disbursed by the employers within

the prescribed time limit and that no deductions other than those authorised by law are

made by the employers. The Act applies proprio vigour to the payment of wages to persons

3
employed in any factory or to persons employed in a railway by a railway by a railway

administration either directly or through subcontractor. Further, the State Governments are

empowered to extend the provisions of the Act to cover persons employed in any industrial

establishment or any class or group of industrial establishments as defined in the Act. The

wage limit for the applicability of the Act is Rs. 1,000 per mansion. It is proposed to amend

the Act with a view to extending its protection to a larger number of persons and making the

provision of the Act more effective the beneficial.

2. With the aforementioned objects in view. The Bill seeks to make the following
amendments in the Act :-
(i) The provisions of the Act are being made applicable automatically and without

any notification by the State Government of persons employed in the various

categories’ of industrial, establishment falling within the preview of the existing

definition of the industrial establishment in the Act (clause 3 (a) of the Bill).

(ii) The existing definition of “industrial establishment” is being covered as a

definition of “industrial or other establishment” and a residuary clause is being

provided to enable the Central Government and the State Governments to bring

within the preview of the definition, by notification in the official Gazette, other

establishments. It is also being provided that the State Governments may extend

the provisions of the Act to other establishment which are so brought within the

preview of definition, subject to the prior concurrence of the Central Government

in the case of any such industrial establishment which is owned by the Central

Government (Clause 3 (b) and Clause 4 of the bill.)

4
 1. Short title, extent, commencement and application.- (1) This Act may be called the
payment of Wages Act, 1936.
(2) It extends to the whole of India.
(3) It shall come into force on such date as the Central Government may, by
notification in the Gazette, appoint.
(4) It applies in the first instance to the payment of wages to persons employed in any
1
[factor, to persons] employed (otherwise than in a factory) upon any railway by a railway
administration or, either directly or through a subcontractors, by a person fulfilling a contract
with a railway administrations 2[and to person employed in an industrial or other
establishment specified in sub-clauses (a) to (g) clause (ii) of section 2].
(5) The State Government may, after giving three months’ notice of its intention of so
doing, by notification in the Official Gazette, extend the provisions of this Act or any of them
to the payment of wages to any class of persons employed in 3[any establishment or class
of establishments specified by the Central Government or a State Government under sub-
clause (h) of clause 2 (ii) of section 2].
4
[Provided that in relation to any such establishment owned by the Central
Government, no such notification shall be issued except with the concurrence of that
Government].
(6) Nothing in the Act shall apply to wages payable in respect of a wage period which,
over such wage-period, average 5[one thousand six hundred rupees] a month or more.
2. Definitions.-In this Act, unless there is anything repugnant in the subject or context,-
(i) “employed person” includes the legal representative of a deceased employed
person;
(i-a) “employer” includes the legal representative of a deceased employer:
(i-b) “Factory” means a factory as defined includes (m) of section 2 of the Factories
Act, 1948 (63 of 1948), and includes any place to which the provisions of that Act have been
applied under subsection (1) of Section 85 thereof;
6
[(ii) “Industrial or other establishment” means any-

1- Subs. by Act. No. 38 of 1982, Vide sec. 3 (i), w.e. f. 15-10-1982.

2- Ins. by ibid, vide sec. 3, w.e. f. 15-10-1982.
3- The words in brackets subs. by ibid, vide sec. 3 (b), w.e. f. 15-10-1982.
4- The Proviso to sub-sec. (5) Subs. by ibid, vide Sec. 3 (b), w.e. f. 15-10-1982.
5- Subs. by ibid. vide sec. 3 (c), w.e. f. 15-10-1982.
6- Subs. by ibid. w.e. f. 15-10-1982.
5
 (a) tramway service, or motor transport service engaged in carrying passengers or
goods or both by road for hire or reward;
(aa) Air transport service other than such service belonging to, or exclusively
employed in the military, naval or air forces of the Union or the Civil Aviation
Department of the Government of India];
(b) dock, wharf or jetty.
(c) inland vessel, mechanically propelled;
(d) mine, quay of oilfield;
(e) Plantation;
(f) Workshop or other establishment in which articles are produced, adapted or
manufactured, with a view to their use, transport or sale:
(g) Establishment in which any work relating to the construction, development or
maintenance of buildings, roads bridges or canals or relating to operations
connected with navigation, irrigation or to the supply or of water, relating to the
generation, transmission and distribution of electricity or any other form of power is
being carried on;
1
[(h) Any other establishment or class of establishment which the Central Government
or a State Government may, having regard to the nature thereof, the need for
protection of persons employed therein and other relevant circumstances,
specify, by notification in the official Gazette];
(ii-a) “mines” has the meaning assigned to it in clause (j) of subsection (1) of Section 2
of the Mines Act, 1952 (35 of 1952).
(iii) “Plantation” has the meaning assigned to it in clause (f) of Section 2 of the
plantations Labour Act, 1951 (69 of 1951);
(iv) “Prescribed” means prescribed by rules made under this Act;
(v) “Railway administration” has the meaning assigned to it in clause (6) of Section 3
of the Indian Railways Act, 1890 (9 of 1890) 2 ; and
(vi) “wages” means all remuneration (whether by way of salary, allowances or
otherwise) expressed in terms of money or capable of being so expressed which
would, if the terms of employment, express or implied, were fulfilled, be payable

1. Sub-clause (h) Ins. by Act No. 38 of 1982,w.e. f. 15-10-1982.

2. Now Act of 1989.
6
 to a person employed in respect of his employment or of work done in such
employment, and includes-
(a) any remuneration payable under any award or settlement between the parties or
order of a Court;
(b) any remuneration to which the person employed is entitled in respect of overtime
work or holidays or any leave period;
(c) any additional remuneration payable under the terms of employment (whether
called a bonus or by any other name);
(d) any sum which by reason of termination of employment of the person employed
is payable under any law, contract or instrument which provides for the payment
of such sum, whether with or without deductions, but does not provide for the
time within which the payment is to be made;
(e) any sum to which the person employed is entitled under any scheme framed
under any law for the time being in force;
but does not include-
(1) any bonus (whether under a scheme of profit sharing or otherwise) which does
not form part of the remuneration payable under the terms of employment or
which is not payable under any award or settlement between the parties or order
of a Court;
(2) the value of any house-accommodation, or of the supply of light, water, medical
attendance or other amenity or of any service excluded from the computation of
wages by a general or special order of the State Government;
(3) any contribution paid by the employer to any pension or provident fund, and
the interest which may have accrued there on;
(4) any travelling allowance or the value of any travelling concession;
(5) any sum paid to the employed person to defray special expenses entailed on
him by the nature of his employment; or
(6) any gratuity payable on the termination of employment in cases other than
those specified in sub-clause (d).
NOTES
Scope of.- (i) An application for recovery of loan was not maintainable as loan did not
fall within the definition of wages under section 2 (vi) of the Payment of Wages Act, 1936
7
nor the amount claimant could be said to be a deduction as provided under section 7 of the
Act. [K. L Garg v. New India Assurance Co. and others, (1992) I Lab LJ 190 (P&H).]
‘Wages’-(ii) The word ‘wages’ in the context of labour laws means wages payable in
lieu of unavailed leave also. [Testile Labour Association v. Official Laquidator, 1993 (66)
F.L.R. 168 (Guj).]
Authorities have no jurisdiction to give a direction for the payment of bonus claimed
which in not an additional remuneration payable under terms of employment as it could not
be treated as claim for wages. [Hari Fertilizers, Varanasi V. IV Addl. Distt. judge, Varanasi
(1995) 70 F.L.R. 168 (All).]
3. Responsibility for payment of wages.- Every employer shall be responsible for
the payment to persons employed by him of all wages required to be paid under this Act:
Provided That, in the case of persons employed (otherwise than by a contractor)-
(a)in factories, if a person has been named as the manager of the factory under
clause (f) of subsection (1) of Section 7 of the Factories Act, 1948 (63 of 1948);
1

(b) in industrial or other establishments, if there is a person responsible to

the employer for the supervision and control of the industrial or order
establishment];
(c) upon railways (otherwise than in factories), if the employer is the railway
administration and the railway administration has nominated a person in this
behalf for the local area concerned,
the person so named, the person so responsible to the employer, or the person so
animated, as the case may be, [shall also be responsible] for such payment.
4. Fixation of wage-periods.- (1) Every person responsible for the payment of
wages under section 3 shall fix periods (in this Act referred to as wage-periods) in respect of
which such wages shall be payable.
(2) No wage-period shall exceed one month.
5. Time of payment of wages.- (1) The wages of every person employed upon or
in-

1. Clause (b) Subs. by Act No. 38 of 1982, vide w.e. f. 15-10-1982.

2. The words in brackets subs. by ibid, vide Sec. 6, w.e. f. 15-10-1982.
8
 (a) any railway, factory or 2[industrial or other establishment] upon or in which less
than one thousand persons are employed. Shall be paid before the expiry of the
seventh day,
(b) any other railway, factory or 1[ industrial or other establishment]. Shall be paid
before the expiry of the tenth day.
After the last day of the wage-period in respect of which the wages are payable;
Provided that in the case of persons employed on a dock, wharf or jetty or in a mine,
the balance of wages found due on completion of the final tonnage account of the ship or
wagons loaded or unloaded, as the space may be, shall paid before the expiry of the
seventh day from the day of such completion.
(2) Where the employment of any person in terminated by or on behalf of the

employer, the wages earned by him shall be paid before the expiry of the second working

day from the day on which his employment is terminated;

Provided that where the employment of any person in an establishment is terminated

due to the closure of the establishment for any reason other than a weekly or other

recognised holiday, the wages earned by him shall be paid before the expiry of the second

day from the day on which his employment is so terminated.

(3) The State Government may. by general or special order, exempt, to such extent

and subject to such conditions as may be specified in the order, the person responsible for

the payment of wages to persons employed upon any railway (otherwise than in a factory)

or to persons employed as daily-rated workers in the Public Work Department of the Central

Government or the State Government from the operation of this section in respect of the

wages of any such persons or class of such persons;

1. The words in brackets subs. by Act No. 38 of 1982, vide Sec. 6, w.e. f. 15-10-1982.
2. Now Act 1989.
9
 [Provided that in the case of persons employed as daily-rated workers as aforesaid, no

such order shall be made except in consolation with the Central Government].

(4) [Save as otherwise provided in subsection (2), all payments] of wages shall be

made on a working day.

6. Wages to be paid in current coin or currency notes.-All wages shall be paid in

current coin or currency notes or in both:
Provided that the employer may, after obtaining the written authorisation of the
employed person, pay him the wages either by cheque or by crediting the wages in his bank
account.
7. Deduction which may be made from wages.- (1) Notwithstanding the provisions of
subsection (2) of section 47 of the Indian Railways Act, 1890 (9 of 1890) 2, the wages of an
employed person shall be paid to him without deductions of any kind except those
authorised by or under this Act.
Explanation I -Every payment made by the employed person to the employer or his
agent shall, for the purposes of this Act, be deemed to be a deduction from wages.
Explanation II - Any loss of wages resulting from the imposition, for good and sufficient
cause, upon a person employed of any of the following penalties, namely:-
(i) the withholding of increment of promotion (including the stoppage of increment
at an efficiency bar);
(ii) the reduction to a lower post or time-scale or to a lower stage in a time-scale;
or
(iii) suspension;
shall not be deemed to be a deduction from wages in any case where the rules framed
by the employer for the imposition of any such penalty are in conformity with the
requirements, if any, which may be specified in this behalf by the State Government by
notification in the Official Gazette.
(2) Deductions from the wages of an employed person shall be made only in
accordance with the provisions of this Act, and may be of the following kinds only, namely;
(a) fines;
(b) deductions for absence from duty;
10
 (c) deductions for custody ; or for loss of money for which he is required to
account, where such damage or loss is directly attributable to his neglect or
default;
(d) deductions for house-accommodation supplied by the employer or by
Government or any housing board set up under any law for the time being in
force (whether the Government or the board is the employer or not) or any other
authority engaged in the business of subsiding in the business of subsing house-
accommodation which may be specified in this behalf by the State Government
by notification in the Official Gazette;
(e) deductions for such amenities and services supplied by employer as the State
Government or any officer specified by it in behalf may by general or special
order, authorise;
Explanation -The word “services” in this clause does not include the supply of tools
and raw materials required for the purposes of employment.
(f) deduction for recovery of advances of whatever nature (including advances for
travelling allowance or conveyance allowance). and the interest due in respect
thereof , or for adjustment of overpayment of wages;
(ff)deduction for recovery of loans made from any fund constituted for the welfare
of labour in accordance with the rules approved by the State Government, and
the interest due in respect thereof;
(fff) deduction for recovery of loans granted for house building or other
purposes approved by the State Government, and the interest due in respect
thereof;
(g) deductions of income-tax payable by the employed person;
(h) deductions required to be made by order of a Court or other authority
competent to make such order;
(i) deductions for subscriptions to, and repayment of advances from any
provident found to which the provident funds Act, 1925 (19 of 1925), applies or
any recognised provident fund as defined in section 58A of the India Income Tax
Act, 1922 (11 of 1922), or any provident fund approved in this behalf by the State
Government, during the continuance of such approval;

11
 (j) Deductions for payment to cooperative societies approved by the State
Government or any officer specified by it in this behalf or to a scheme of
insurance maintained by the Indian Post Office;
(k) deductions, made with the written authorisation of the person employed for
payment of any premium on his life insurance policy to the Life Insurance
Corporation of India established under the Life Insurance Corporation Act, 1956
(31 of 1956), or for the purchase of securities of the Government of India or of
any State Government or for being deposited in any Post Office Savings Bank in
furtherance of any savings scheme of any such Government.
[(kk)
1
deductions made, with written authorisation of the employed person, for
the payment of his contribution to any fund constituted by the employer of a trade
union registered under the Trade Unions Act, 1926 (16 of 1926), for the welfare
of the employed persons or the members of their families, or both, and approved
by the State Government or any officer specified by it in this behalf, during the
continuance of such approval;
1
[(kkk) deduction made, with the written authorisation of the employed person,
for payment of the fees payable by him for the membership of any trade union
registered under the Trade Unions Act, 1926 (16 of 1926);]
(I) deductions for payment of insurance premia on fidelity Guarantee Bonds;
(m) deductions for recovery of losses sustained by a railway administration
on account of acceptance by the employed person of counterfeit or base coins or
mutilated or forged currency notes;
(n) deductions for recovery of losses sustained by a railway administration on
account of the failure of the employed person to invoice, to bill, to collect or to
account for the appropriate charges due to that administration, whether in respect
of fares, freight, demurrage, wharfage and carnage or in respect of sale of food in
catering establishments or in respect of sale of commodities in grain shops or
otherwise;

1. Clause (kk) Ins. by Act No. 38 of 1982, vide sec. 7, w.e.f. 15-10-1982.
2. Causes (kkk) Ins. by ibid, sec. 7, w.e.f. 15-10-1982.
12
 (o) deductions for recovery of losses sustained by a railway administration on
account of any rebates or refunds incorrectly granted by the employed person
where such loss is directly attributable to his neglect or default;
3
[(p) deductions, made, with the written authorisation of the employed person, for
contribution to the Prime Minister’s National Relief Fund or to such other Fund as
the Central Government may, by notification in the Official Gazette, specify;]
4
[(q) deductions for contribution to any insurance scheme framed by the Central
Government of the benefit of its employees.
(3)Notwithstanding anything contained is this Act, the total amount of deduction

which may be made under subsection (2) in any wage-period from the wages of

any employed person shall not exceed-

(i) in cases where such deduction are wholly or partly made for payments to

cooperative societies under clause (j) of subsection (2), seventy-five percent of

such wages, and

(ii) in any other case, fifty percent of such wages:

Provided that where the total deductions authorised under subsection (2) exceed

seventy-five percent or, as the case may be, fifty percent of the wages, the

excess may be recovered in such manner as may be prescribed.

(4)Nothing contained in this section shall be construed as precluding the

employer from revering from the wages of the employed person or otherwise any

amount payable by such person under any law for the time being in force being in

force other than the India Railways Act, 1890 (9 of 1890)].

1. Ins. by Act No. 29 of 1976, w.e.f. 12-11-1975.

2. Inserted by Act No. 19 of 1977, w.e.f. 30-6-1977.
13
 8. Fines.- (1) No fine shall be imposed on any employed person save in respect of

such acts and omissions on his part as the employer, with the previous approval of the State

Government or of the prescribed authority, may have specified by notice under subsection

(2).

(2) A notice specifying such acts and omissions shall be exhibited in the prescribed
manner on the premises in which the employment is carried on or in the case of person
employed upon railway (otherwise than in a factory), at the prescribed place or places.
(3) No fine shall be imposed on any employed person until he has been given an
opportunity of showing cause against the fine, or otherwise than in accordance with such
procedure as may be prescribed for the imposition of fines.
(4) The total amount of fine which may be imposed in any one wage-period on any
employed person shall not exceed an amount equal to 1[ three per cent] of the wages
payable to him in respect of that wage-period.
(5) No fine imposed on any employed person who is under the age of fifteen years.
(6) No fine imposed on any employed person shall be recovered from him by
instalments or after the expiry of sixty days the day on which it was imposed.
(7) Every fine shall be deemed to have been imposed, on the day of the act or
omission in respect of which it was imposed.
(8) All fines and all realisations thereof shall be recorded in a register to be kept by the
person responsible for the payment of wages under Section 3 in such form as may be
prescribed and all such realisation shall be applied only to such purposes beneficial to the
persons employed in the factory or establishment as are approved by the prescribed
authority.
Explanation-When the persons employed upon or in any railway, factory or 2[industrial
or other establishment] are part only of staff employed under the same management, all
such realisations may be credited to a common fund maintained for the staff as a whole,
provided that the fund shall be applied only to such purpose as are approved by the
prescribed authority.

1. Subs. by Act No. 38 of 1982, vide Sec 8, w.e.f. 15-10-1982.

2. Subs. by ibid, vide Sec 8 ,w.e.f. 15-10-1982.
14
 9. Deductions for absence from duty.- (1) Deductions may be made under clause (b) of
subsection (2) of Section 7 only on account of the absence of an employed person from the
place or places where, by the terms of his employment, he is required to work, such
absence being for the whole or any part of the period during which he is so required to work.
(2) The amount of such deduction shall in no case bear to the wages payable to the
employed person in respect of the wage period for which the deduction is made in a larger
proportion than the period for which he was absent bears to the made in larger proportion
than the period for which he was absent bears to the total period within such wage-period,
during which by the terms of his employment, he was required to work:
Provided that, subject to any rules made in this behalf by the State Government, if ten
or more employed persons acting in concert absent themselves without due notice (that is to
say without giving the notice which is required under the terms of their contracts of
employment) and without reasonable cause, such deduction from any such person may
include such amount not exceeding his wages for eight days as may be any such terms be
due to the employer in lieu of due notice.
Explanation-For the purposes of this section, an employed person shall be deemed to
be from the place where he is required to work if, although present in such place, be
refuses, in pursuance of a stay-in-strike or for any other cause which is not reasonable in the
circumstances, to carry out his work.
NOTE
Scope of-Validity of deduction of wages of employees who were prevented from
attending duty on account of Andhar Bandh.-It was held that if the Tribunal finds that an
employee was not responsible for absence form duty or he prevented from attending duty.
The Management is not entitled to deduct wages. The Tribunal is also empowered to go into
the reasons and record a finding in that regard. In the present case the workman were
prevented from attending duty by the organisers of the bandh. Therefore, the Tribunal has
jurisdiction to go into this question. [Kothari (Madras) Ltd.V.Second A.J.Cum Appellate
Authority & others, (1991) II Lab. LJ 604 (A.P).]
10. Deductions for damage or loss.- (1) A deduction under clause (c) or clause (o) of
subsection (2) of Section 7 until the employed person has been given an opportunity of
showing cause against the deduction, or otherwise than in accordance with such procedure
as may be prescribed for the making of such deductions.
15
 (1-A) A deduction shall not be made under clause (c) or clause (m) or clause (n) or
clause (o) of subsection (2) of Section 7 until the employed person has been given an
opportunity of showing cause against the deduction, or otherwise than in accordance with
such procedure as may be prescribed for the making of such deductions.
(2) All such deductions and all realisations thereof shall be recorded in a register to be
kept by the person responsible for the payment of wages under section 3 in such form as
may be prescribed.
11. Deductions for services rendered.-A deduction under clause (d) or clause (e) of

substation (2) of Section 7 shall not be made from the wages of as employed person, unless

the house-accommodation, amenity or service has been accepted by him, as a term of

employment or otherwise, and such deduction shall not exceed an amount equivalent to the

value of the house, accommodation amenity or service supplied and, in the case of a

deduction under the said clause (e), shall be subject to such conditions as the State

Government may impose.

12. Deductions for recovery of advances.-Deductions under clause (f) of substation (2)

of Section 7 shall be subject to the following conditions, namely:-

(a)recovery of an advance of money given before employment began shall be

made from the first payment of wages in respect of a complete wage-period, but

no recovery shall be made of such advances given for travelling-expenses;

(aa) recovery of an advance of money given after employment began shall

be subject to such conditions as the State Government may impose; and

(b) recovery of advances of wages not already earned shall be subject to

any rules made by the State Government regulating the extent to which such

advances may be given and the instalments by which they may be recovered.
16
 12-A. Deduction for recovery of loans.-Deduction for recovery of loans granted under
clause (fff) of sub-Section (2) of Section 7 shall be subject to nay rules made by the State
Government regulating the extent to which such loans may be granted and the rate of
interest payable there on.
13. Deduction for payment to cooperative societies and insurance schemes.-
Deduction under clause (j) and clause (k) of substation (2) of Section 7 shall be subject to
such conditions as the State Government may impose.
13-A. Maintenance of registers and records.- (1) Every employer shall maintain such
registers and records giving such particulars of persons employed by him, the work
performed by them, the wages paid to them, the deductions made from their wages, the
receipts given by them and such other particulars and in such form as may be prescribed.
(2) Every register and record required to be maintained under this section shall, for the
purposes of this Act, be preserved for a period of three years after the date of the last entry
made therein.
14. Inspectors.- An Inspector of Factories appointed under substation (1) of Section 8
of the Factories Act, 1948 (63 of 1948), shall be an Inspector for the purposes of this Act in
respect of all factories within the local limits assigned to him.
(2) The State Government may appoint Inspectors for the purposes of this Act in
respect to of all persons employed upon a Railway (otherwise than in a factory) to whom this
Act applies.
(3) The State Government may, by notification in the Official Gazett, appoint such
other persons as it thinks to be inspectors for the purpose of this Act, and may define the
local limits within which and the class of factories and [industrial or other establishment] in
respect of which they shall exercise their functions.
(4) An Inspector may, -
(a) make such examination and inquiry as he thinks fit in order to ascertain whether
the provisions of this Act or rules made thereunder the are being observed;
(b) With such assistance, if any, as he thinks fit, enter, inspect and search any
premises of any railway, factory of 2[industrial or other establishment] at any
reasonable time for the purpose of carrying out the objects of this Act;

1- Subs. by Act. No.; 38 of 1982, vide sec. 9 w.e.f. 15-10-1982

2- Subs. by ibid. sec. 9, w.e.f. 15-10-1982.
17
 (c) supervise the payment of wages to person employed upon any railway or in any
factory or 3[industrial or other establishment];
(d) required by a written order the production at such place, as may be prescribed, of
any register or record maintained in pursuance of this Act and take on the spot or
otherwise statement of any persons which he may consider necessary for
carrying out the purpose of this Act;
(e) Seize or take copies of such registers or documents or portions thereof as he
may consider relevant in respect of an offence under this Act which he has
reason to believe has been committed by an employer;
(f) exercise such other powers as may be prescribed;
Provided that no person shall be compelled under this substation to answer any
question or make any statement tending to inseminate himself.
(4-A) The provisions of the 1[ Code of Criminal procedure, 1973 (2 of 1974) shall so
far as may be, apply to any search or seizure under this substation as they apply to any
search or seizure made under the authority of a warrant issued under 2[Section 94] of the
said Code.
(5) Every inspector shall be deemed to be a public servant within the meaning of the
Indian Penal Code (45 of 1860).
14-A. Facilities to be afforded to Inspectors- Every employer shall afford an inspector
all reasonable facilities for making any entry, inspection, supervision examination or inquiry
under this Act.
15- Claims arising out of deductions from wages or delay in payment of wages and
penalty for malicious or vexatious claims - (1) The State Government may, by notification in
the Official Gazett, appoint a presiding officer of any Labour Court of Industrial Tribunal,
constituted under the Industrial Disputes Act, 1947 (14 of 1947), or under any
corresponding law relating to the investigation and settlement of industrial disputes in force
in the State or any commissioner for workmen’s Compensation or other officer with
experience as a judge of a civil court of as a stipendiary Magistrate to be the authority to
hear and decide for any specified area all claims arising out of deductions from the wages,

3- Subs. by ibid. w.e.f. 15-10-1982

1- Subs. by Act. No.; 38 of 1982, w.e.f. 15-10-1982

2- Subs. by ibid. w.e.f. 15-10-1982
18
or delay in payment of the wages, of persons employed or paid in that area, including all
matter incidental to such claims:
Provided That where the State Government considers it necessary so to do. It may
appoint more than one authority for any specified area and may, by general or special order,
provide for the distribution or allocation of work to be performed by them under this act.
(2) Where contrary to the provisions of this Act any deduction has been made
from the wages of an employed person, or any payment of wages has been delayed, such
person himself, or any legal practitioner or any official or a registered trade union authorised
in writing to act on his behalf, or any Inspector under this Act, or any other person acting
with the permission of the authority appointed under substation (1), may apply to such
authority for a direction under substation (3):
Provided that every such application shall be presented within twelve months from the
date on which the deduction from the wages was made, or from the date of which the
payment of the wages was due to be made, as the case may be:
Provided further that any application may be admitted after the said period of twelve
months when the applicant satisfies the authority that he had sufficient cause for not
making the application within such period.
(3) When any application under substation (2) is entertained, the authority shall
hear the applicant and the employer or other persons responsible for the payment of wages
under Section 3, or give them an opportunity of being heard, and, after such further inquiry
(if any), as may be necessary, may, without prejudice to any other penalty to which such
employer or other person is liable under this Act, direct the refund to the employed person
of the amount deducted, or the payment of the delayed wages, together with the payment of
such compensation as the authority may think fit, not exceeding ten times the amount
deducted in the former case and not exceeding twenty-five Rupees in the latter, and even if
the amount deducted or the delayed wages are paid before the disposal of the application
direct the payment of such compensation, as the authority may think fit, not exceeding
twenty-five rupees:
Provided that no direction for the payment of compensation shall be made in the case
of delayed wages if the authority is satisfied that the delay was due to-
(a) A bona fide error or bona fide dispute as to the amount payable to the employed
person, or
19
 (b) The occurrence of an emergency, or the existence of exceptional circumstances,
such that the person responsible for the payment of the wages was unable,
though exercising reasonable diligence, to make prompt, payment, or.
(c) The failure of the employed person to apply for or accept payment;
(4) If the authority hearing an application under this section is satisfied-
(a) That the application was either malicious, or vexatious, the authority may direct
that a penalty not exceeding fifty rupees be paid to the employer or other person
responsible for the payment of wages by the person presenting the application;
or
(b) That in any case in which compensation is directed to be paid under substation
(3), the applicant ought not to have been compelled to seek redress under this
section, the authority may direct that a penalty on exceeding fifty rupees be paid
to the state Government by the employer or other person responsible for the
payment of wages.
(4-A) Where there is any dispute as to the person or persons being the legal
representative or representatives of the employer or of the employed person, the
decision of the authority on such dispute shall be final.
(4-B)Any Inquiry under this section shall be deemed to be a judicial proceeding within
the meaning of section 193, 219 and 228 of the Indian Penal Code (45 of 1860).
(5) Any amount directed to be paid under this section may be recovered-
(a) If the authority is a Megistrate, by the authority as if it were a fine imposed by him
as Magistrate, and
(b) if the authority is not a Megistrate, by any Magistrate to whom the authority
makes application in his behalf, as if it where a fine imposed by such Magistrate.
16. Single application in respect of claims from unpaid group - (1) Employed
persons are said to belong to the same unpaid group if they are borne on the same
establishment and if deductions have been made from their wages in contravention of this
Act for the same cause and during the same wage-period or periods or if their wages for
same wage-period or periods have remained unpaid after the day fixed by Section 5.
(2) A single application may be presented under section 15 on behalf or in respect of
any number of employed persons belonging to the same unpaid group, and in such case

20
every person on whose behalf such application is presented may be awarded maximum
compensation to the extent specified in subsection (3) of section 15.
(3) The authority may deal with any number of separate pending applications,
presented under section 15 in respect of persons belonging to the same unpaid group, as a
single application presented under subsection (2) of this section, and the provisions of that
subsection shall apply accordingly.
17. Appeal - (1) An appeal against an order dismissing either wholly or in part an
application made under subsection (2) of section 15, or against a direction made under
subsection (3) or subsection (4) of that section may be preferred within thirty day of the date
on which the order of direction was made, in a presidency-town before the Court of Small
Courses and elsewhere before the District Court-
(a) By the employer or other person responsible for the payment of wages under
section 3, if the total sum directed to be paid by way of wages and compensation
exceeds three hundred rupees, or such direction has the effect of imposing on
the employer, or the other person a financial liability exceeding one thousand
rupees, or
(b) By an employed person, or any legal petitioner or any official of a registered trade
union authorised in writing to act on his behalf or any Inspector under this Act, or
any other person permitted by the authority to make an application under
substation (2) of section 15, if the total amount of wages claimed to have been
withheld from the employed persons exceeds twenty rupees or from the unpaid
group to which the employed person belongs or belonged exceeds fifty rupees,
or
(c) By any person directed to pay a penalty under substation (4) of section 15.
(1-A) No appeal under clause (a) of substation (1) shall lie unless the memorandum of
appeal is accompanied by a certificate by the Authority to the effect that the appellant has
deposited the amount payable under the direction appealed against.
(2) Save as provided in substation (1), any order dismissing, either wholly or in
part an application made under substation (2) of section 15 or a direction made under
substation (3) or substation (4) of that section shall be final.
(3) Where an employer prefers an appeal under this section, the authority against
whose decision the appeal has been preferred may, and if so directed by the court referred
21
to in substation (1) shall, pending the decision of the appeal, withhold payment of any sum
in deposit with it.
(4) The Court referred to in substation (1) may, if it thinks fit, submit any question
of law for the decision of the High Court and, if it so does, shall decide the question in
conformity with such decision.

NOTE
Where the petitioner was aggrieved by an expert order he should have filed an appeal
under section 17 of the Act. Hence the writ petition filed by the petitioner was held to be not
maintainable on merits before High Court (Luxmi Industrial Corp. V.K.K. Tiwari, (1995) 70
FLR 707 (Raj.)].
17-A. Conditional attachment of property of employer or other person responsible for

payment of wages- (1) Where at any time after an application has been made under

substation (2) of section 15 the authority, or where at any time after an appeal has been

filed under section 17 by an employed person or any legal practitioner or any official of a

registered trade union authorised in writing to act on his behalf or any Inspector under this

Act or any other person permitted by the authority to make an application under subsection

(2) of Section 15 the Court referred to in that section , is satisfied that the employer or other

persons responsible for the payment of wages under section 3 is likely to evade payment of

any amount that may be directed to be paid under Section 15 or section 17, the authority or

the Court, as the case may be, except in cases where the authority or Court is of opinion

that the ends of justice would be defeated by the delay, after giving the employer or other

person an opportunity of being heard, may direct the attachment of so much of the property

of the employer or other person responsible for the payment of wages as is, in the opinion

of the authority or Court, sufficient to satisfy the amount which may be payable under the

direction.
22
 (2) The provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to

attachment before judgment under that Code shall, so far as may be, apply to any order for

attachment under subsections (1).

18. Powers of authorities appointed under section 15.-Every authority appointed under
subsections (1) of Section 15 shall have all the powers of a Civil Court under the Code of
Civil Procedure, 1908 (5 of 1908), for the purpose of taking evidence and of enforcing the
attendance of witnesses and compelling the production of documents, and every such
authority shall be deemed to be a Civil Court for all the purposes of Section 195 and of 1[
Chapter XXVI of the code of Criminal Procedure, 1973 (2 of 1974)].

NOTE
“Authority” under the Payment of Wages Act, 1936, being a “persona designate”, has
no power to recall the earlier order passed by another authority and has no expressed
power. Therefore, the imputed order restoring the claim application filed by not the original
applicant, is liable to be set aside. [Ramala Sahkari Chini Mills Ltd. Meerut v. The Payment
of Wages Act Authority-cum-Conciliation Officer, Meerut, (1995) 70 FLR 58 (All).]
19. Power to recover from employer in certain cases.-repealed.]
20. Penalty for offences under the Act.- (1) Whoever being responsible for the
payment of wages to an employed person contravenes any of the provisions of any of
following sections, namely, Section 5 except subsections (4) thereof, Section 7, Section 8
except subsections (8) thereof, Section 9 Section 10, except subsection (2) thereof, and
Section 11 to 13, both inclusive, shall be punishable with fine, 2[with shall not be less than
two hundred rupees but which may extend to one thousand rupees].
(2) Whoever contravenes the provisions of Section 4, subsection (4) of Section 5,
section 6, subsection (8) of Section 8 subsection (2) of Section 10 or section 25 shall be
punishable with fine which may extend to [five hundred rupees]. 3
(3) Whoever being rewired under this Act to maintain any records or registers or
to furnish any information or return-
(a) fails to maintain such register or record; or
(b) wilfully refuses or without lawful excuse neglects to furnish such information or
return; or

23
 (c) wilfully furnishes or causes to be furnished any information or return which he
knows to be false; or
(d) refuses to answer or wilfully gives a false answer to any question necessary for
obtaining any information require to be famished under this Act;
shall, for each such offence, be punishable with fine 4[which shall not be less than two
hundred rupees, but which may extend to one thousand rupees].
(4) Whoever-
(a) Wilfully obstructs an Inspector in the discharge of his duties under this Act; or
(b) refuses or wilfully neglects to afford an Inspector any reasonable facility for
making any entry, inspection, examination, supervision or inquiry authorised by or
under this Act in relation to any railway, factory or [industrial or other
establishment]1; or
(c) wilfully refuses to produce on the demand of an Inspector any register or other
document kept in pursuance of this Act; or
(d) prevents or attempts to prevent or does anything which he has any reason to
believe is likely to prevent any person from appearing before or being examined
by an Inspector acting in pursuance of his duties under this Act.
Shall be punishable with fine 2[which shall not be less than two hundred rupees but
which may extend to one thousand rupees.]
(5) If any person who has been convicted of any offence punishable under this
Act is again guilty of an offence involving contravention of the same provision, he shall be
punishable on a subsequent conviction with may extend to six months and with fine which
shall not be less than five hundred rupees but which may extend to three thousand rupees]:
Provided that for the purpose of this subsection, no cognizance shall be taken of any
conviction made more than two years before the date on which the commission of the
offence which is being punished came to the knowledge of the Inspector.
(6) If any person fails or wilfully neglects to pay the wages of any employed
person by the date fixed by the authority in this behalf, he shall, without prejudice to any

1- Subs. by Act. No.; 38 of 1982, vide sec. 10, w.e.f. 15-10-1982.

2- Subs. by ibid, vide sec. 11, w.e.f. 15-10-1982.
3- Subs. by ibid, vide sec. 11, w.e.f. 15-10-1982.
4- subs. by Act No. 38 of 1982, vide sec. 11, w.e.f. 15-10-1982.
24
other action that may be taken against him, be punishable with an additional fine which may
extend to 4[one hundred rupees] for each day for which such failure or neglect continues.
21. Procedure in rail of offences.- (1) No Court shall take cognizance of a
complaint against any person for an offence under subsection (1) of Section 20 unless an
application in respect of the facts constituting the offence has been presented under section
15 and has been granted wholly or in part and the authority empowered under the latter
section or the Appellate Court granting such application has sanctioned the making of the
complaint.
(2) Before sanctioning the making of a complaint against any person for an
offence under subsection (1) of section 20, the authority empowered under section 15 or the
Appellate court, as the case may be, shall give such person an opportunity of showing
cause against the granting of such sanction, and the sanction shall not be granted if such
person satisfies the authority or court that his default was due to-
(a) a bona fide error or bona fide dispute as to the amount payable to the employed
person, or
(b) The occurrence of an emergency, or the existence of exceptional circumstances,
such that the person responsible for the payment of the wages was unable,
though exercising reasonable diligence, to make prompt payment, or
(c) The failure of the employed person to apply for or accept payment.
(3) No Court shall take cognizance of a contravention of section 4 or of section 6
or of a contravention of any rule made under section 26 except on a complaint made by or
with the sanction of an Inspector under this Act.
(3-A) No Court shall take cognizance of any offence punishable under subsection
(3) or subsection (4) of section 20 except on a complaint made by or with the sanction of an
Inspector under this Act.
(4) In imposing any fine for an offence under subsection (1) of Section 20 the
court shall take into consideration the amount of any compensation already awarded
against the accused in any proceedings taken under section 15.

1- Subs. by ibid, vide sec. 11(i), w.e.f. 15-10-1982.

2- Subs. by ibid, vide sec. 11(d) (ii), w.e.f. 15-10-1982.
3- Subs. by ibid, vide sec. 11(e), w.e.f. 15-10-1982.
4- Subs. by ibid, vide sec. 11(f), w.e.f. 15-10-1982.
25
 22. Bar of suits.- No court shall enteration any suit for the recovery of wage or of
any deduction from wages insofar as the sum so claimed-
(a) forms the subject of an application under Section 15 which has been presented
by the plaintiff and which is pending before the authority appointed under that
section or of an appeal under section 17 ; or
(b) has formed the subject of a direction under section 15 in favour of the plaintiff ; or
(c) has been adjusted, in any proceeding under section 15, not to be owed to the
plaintiff; or
(d) could have been recovered by an application under section 15.
NOTE
Scope of - Section 22 of the Payment of Wages Act excludes the Jurisdiction of the
Court to entertain a suit in respect of the matter entrusted to the jurisdiction of the Authority
constituted under section 15 of the payment of wages Act. The Labour Court cannot be
regarded as a court of general jurisdiction section 22 bars institution of as suit. It does not
bar the institution of an application of recovery of wages under section 33-C (2) 0f the
Industrial Disputers Act. The Labour Court is not a Civil Court. As such its Jurisdiction to
etertain an application under section 33-C (2) of the industrial Disputes Act for payment of
wages to a workman is not barred by virtue of the provisions of section 22 of the Payment of
Wages Act. (Jaipur Development Authority V. Labour Court and others, (1991) II Lab. LJ
133 (Raj.).]
22-A. Protection of action taken in good faith. - No Suit, prosecution or other legal
proceeding shall lie against the Government or any Officer of the Government for anything
which is in good faith done or intended to be done under this Act.
23. Contracting out - Any contract or agreement, whether made before or after the
commencement of this Act, whereby an employed person relinquishes and right conferred
by this Act shall be null and void insofar as it purports to deprive him of such right.
24. Application of Act or railway air transport services, mines and oilfields - The
powers by this Act conferred upon the State Government shall, in relation to railway, air
transport services, mines and oil- field be powers of the Central Government.
25. Display by notice of abstracts of the Act. - The person responsible for the
payment of wages to persons employed in a factory [ or an industrial or other
establishment]1 shall cause to be [display in such factory or industrial or other
26
establishment]2 a notice containing such abstracts of this Act and of the rules made
thereunder in English and in the language of the majority of the persons employed 3[in the
factory or industrial or other establishment] as may be prescribed.
4
[ 25-A. Payment of undisturbed wages in case of death of employed person - (1)
Subject to the other provisions of the Act, all amounts payable to an employed person as
wages shall, if such amounts could not or cannot be paid on account of his death before
payment or on account of his whereabouts not being known-
(a) be paid to the person nominated by him in his behalf in accordance with the rules
made under this Act; or
(b) Where no such nomination has been made or where for any reasons such
amounts cannot be paid to the person so nominated, be deposited with the
prescribed authority who shall deal with the amounts so deposited in such
manner as may be prescribed.
(2) Where, in accordance with the provision of subsection (1), all amounts payable to
an employed person as wages -
(a) are paid by the employer to the person nominated by the employed person; or
(b) are deposited by the employer with the prescribed authority, the employer shall
be discharged of his liability to be those wages].
26. Rule-making power - (1) The State Government may make rules to regulate
the procedure to be followed by the authorities and Courts referred to in Section 15 and 17.
(2) The State Government may, by notification in the Official Gazett, make rules
for the purpose of carrying into effect the provision of this Act.
(3) In particular and without prejudice to the generality of the foregoing power,
rules made subsection (2) may-
(a) require the maintenance of such records, registers, return and notices as are
necessary for the enforcement of the Act, prescribe the form thereof and the
particulars to be entered in such registers, or records;

1- Subs. by Act No. 38 of 1982, vide sec. 12 (a), w.e.f. 15-10-1982.

2- Subs. by ibid, vide sec. 12(b), w.e.f. 15-10-1982.
3- Subs. by ibid, vide sec. 12 (c), w.e.f. 15-10-1982.
4- Sec. 25-A Ins. by ibid. (w.e.f. 1-3-1994) vide G.S.R. 237 (E) dated 1-3-1994.
27
(b) require the display in conspicuous place on premises where employment is
carried on of notices specifying rates of wages payable to persons employed on
such premises;
(c) Provided for the regular inspection of the weights, measures and weighting

machines used by employees in checking or ascertaining the wages of persons

employed by them;

(d) Prescribe the manner of giving notice of the days on which wages will be paid;

(e) prescribe the authority competent to approve under subsection (1) of section 8

acts and omission in respect of which fines may be imposed;

(f) prescribe the procedure for the imposition of fines under Section 8 and for the

making of the deductions referred to in Section 10;

(g) prescribe the conditions subject to which deductions may be made under the

proviso to subsection (2) of Section 9;

(h) prescribe the authority competent to approve the purpose on which the proceeds

of fines shall be expended;

(i) prescribe the extent to which advances may be made and the instalments by

which they may be recovered with reference to clause (b) of Section 12;

(i-a) prescribe the extent to which loans may be granted and the rate interest payable

thereon with reference to Section 12-A;

(i-b) Prescribe the powers of Inspectors for the purposes of this Act;

(j) regulate the Scales of costs which may be allowed in proceeding under the Act;

28
 (k) prescribe the amount of court fees payable in respect of any proceedings under

this Act;

(l) prescribed the abstract to be contained in the notices required by Section

25[***]1.

(l-a) prescribe the form and manner in which nominations may be made for the

purpose of subsection (1) of section 25-A, the cancellation or variation of any

such nomination, or the making of any fresh nomination in the event of the

nominee predeceasing the persons making nomination; and others matters

connected with such nominations;

(l-b) Specify the authority with whom amounts required to be deposited under clause

(b) of subsection (1) of Section 25-A shall be deposited, and the manner in which

such authority shall deal with the amounts deposited with it under the clause;

(m) Provide for any other matter which is to be or may be prescribed.

(4) In making any rule under this section the State Government may provide that

a contravention of the rule shall be punishable with fine which may extend to two hundred

rupees.

(5) All rules made under this section shall be subject to the condition of previous

publication, and the date of be specified under clause (3) of Section 23 of the General

Clauses Act, 1897 (10 of 1897), shall not be less than three months from the date on which

the draft of the proposed rules was published.

1- The word ‘and omittey by Act No. 38 of 1982, vide sec. 14 (a), w.e.f. 15-10-1982.

29
 (6) Every rule made by the Central Government
under this section shall be laid,

as soon as may be after it is made, before each House of

Parliament while it is in session of a total period of thirty

days which may be comprised in on session or in [two

or more successive sessions]2 and if, before the expiry of

the session 3[immediately following the session or the

successive sessions aforesaid] both Houses agree in

making any modification in the rule, or both Houses

agree that the rule should not be made, the rule shall

thereafter have effect only in such modified form or be or

no effect, as the case may be; so however, that any such

modification or annulment shall be without prejudice to the

validity of anything previously done under that rule.

 1- Clauses (la), (lb) Ins. by ibid. vide Sec. 14 (a), w.e.f. 15-10-
1982.
2- Subs. by ibid. w.e.f. 15-10-1982.
30

THE PAYMENT OF WAGES ACT, 1936

Sec.
[ACT 4 OF 1936]
[23rd April, 1936]
An Act to regulate the payment of wages of certain classes of 1[employed
persons].
Whereas it is expedient to regulate the payment of wages to certain classes of
[employed persons];
It is hereby enacted as follows:-
1. Short title, extent, commencement and application.- (1) This Act may be called
the Payment of Wages Act, 1936.
2
[(2) It extends to the whole of India 3[***].]
(3) It shall come into force on such date 4as the Central Government may, by
notification in the Official Gazette, appoint.
(4) It applies in the first instance to the payment of wages to persons
employed in any 5[factory, to persons] employed (otherwise than in a factory)
upon any railway by a railway administration or, either directly or through a sub-
contractor, by a person fulfilling a contract with a railway administration, 6[and to
persons employed in an industrial or other establishment specified in sub-
clauses (a) to (g) of clause (ii) of Section 2].
(5) The 7[Appropriate Government] may, after giving three months' notice of
its intention of so doing, by notification in the Official Gazette, extend the
provisions of 8[this Act or any of them to the payment of wages to any class of
persons employed in 9[any establishment or class of establishments specified by
the Central Government or a State Government under sub-clause (h) of clause (ii)
of section 2.]
10
[Provided that in relation to any such establishment owned by the Central
Government, no such notification shall be issued except with the concurrence of
that Government.]
11
[(6) This Act applies to wages payable to an employed person in respect of
a wages period is such wages for that wage period do not exceed 12[ten thousand
rupees per month] or such other higher sum which, on the basis of figures of the
Consumer Expenditure Survey published by the National Sample Survey

1 Subs. by Act No.38 of 1982, S. 2, for “persons employed in industry” (w.e.f. 15.10.1982)
2 Subs. by A.O. 1950, for sub-sec
3 Omitted by Act 51 of 1970
4 28th March, 1937, see Gaz. of India 1937, Pt. 1, p. 626.
5 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
6 Ins. by Act No.38 of 1982 (w.e.f. 15.10.1982)
7 Subs. by Act 41 of 2005, sec. 3 for “The State Government” (w.e.f 09-11-2005)
8 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
9 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
10 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
11 Subs. by Act 41 of 2005, sec. 2, for sub-section “(6) Nothing in this Act shall apply
to wages payable in respect of a wage-period which over such wage period, average
one thousand six hundred rupees a month or more” (w.e.f 09-11-2005).
12 Substituted for “six thousand five hundred rupees per month” by S.O. 1380(E),
dated 8th August, 2007.
2 The Payment of Wages Act, 1936 Sec.

Organisation, the Central Government may, after every five years, by notification in
the Official Gazette, specify.]

2. Definitions.- In this Act, unless there is anything repugnant in the

subject or context,-
1
[(i) “appropriate Government” means, in relation to railways, air
transport services, mines and oilfields, the Central Government
and, in relation to all other cases, the State Government;]
2 3
[ [(ia) “employed person” includes the legal representative of a
deceased employed person;
(ib) “employer” includes the legal representative of a deceased
employer;
4 5
[ [(ib) “factory” means a factory as defined in clause (m) of Section 2 of
Section 2 of the Factories Act, 1948 (63 of 1948) and includes
any place to which the provisions of that Act have been applied
under sub-section (1) of Section 85 thereof;]
6
(ii) [industrial or other establishment means] any-
7
[(a) tramway service, or motor transport service engaged in
carrying passengers or goods or both by road for hire or
reward;
(aa) air transport service other than such service belonging to
or exclusively employed in the military, naval or air
forces of the Union or the Civil Aviation Department of
the Government of India;
(b) dock, wharf or jetty;]
8
[(c) inland vessel, mechanically propelled;]
(d) mine, quarry or oil-field;
(e) plantation;
(f) workshop or other establishment in which articles are
produced, adapted or manufactured, with a view to their
use, transport or sale;
9
[(g) establishment, in which any work relating to the
construction, development or maintenance of buildings,
roads, bridges or canals, or relating to operations
connected with navigation, irrigation or the supply of
water, or relating to the generation, transmission and
distribution of electricity or any other form of power is
being carried on.

1 Ins. by Act 41 of 2005, sec. 4(a) (w.e.f 09-11-2005)

2 Clauses (i), (ia) and (ib) subs. by Act 53 of 1964, sec. 3 for clause (i) (w.e.f. 1-2-1965).
3 Clauses (i), (ia) and (ib) renumbered as clauses (ia), (ib) and (ic) by Act 41 of 2005,
sec. 4(a) (w.e.f 09-11-2005).
4 Clauses (i), (ia) and (ib) subs. by Act 53 of 1964, sec. 3 for clause (i) (w.e.f. 1-2-1965).
5 Clauses (i), (ia) and (ib) renumbered as clauses (ia), (ib) and (ic) by Act 41 of 2005,
sec. 4(a) (w.e.f 09-11-2005).
6 Subs. by Act No. 38 of 1982, sec. 3 for “industrial establishment” means‟ (w.e.f.
15.10.1982)
7 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
8 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
9 Ins. by Act No.68 of 1957 (w.e.f. 1.4.1958)
Sec. 2 The Payment of Wages Act, 1936 3

1
[(h) any other establishment or class of establishments
which the Central Government or a State Government
may, having regard to the nature thereof, the need for
protection of persons employed therein and other
relevant circumstances, specify, by notification in the
Official Gazette].
2
[(iia) “mine” has the meaning assigned to it in clause (j) of sub- section
(1) of Section 2 of the Mines Act, 1952 (35 of 1952);]
3
[(iii) “Plantation” has the meaning assigned to it in clause (f) of
Section 2 of the Plantations Labour Act, 1951 (69 of 1951);]
(iv) “prescribed” means prescribed by rules made under this Act,
4
[(v) “railway administration” has the meaning assigned to it in clause
(32) of section 2 of the Indian Railways Act, 1989 (24 of 1989);]
5
[(vi) “wages” means all remuneration (whether by way of salary,
allowances or otherwise) expressed in terms of money or capable
of being so expressed which would, if the terms of employment,
express or implied, were fulfilled, be payable to a person
employed in respect of his employment or of work done in such
employment, and includes-
(a) any remuneration payable under any award or
settlement between the parties or order of a Court;
(b) any remuneration to which the person employed is
entitled in respect of overtime work or holidays or any
leave period;
(c) any additional remuneration payable under the terms of
employment (whether called a bonus or by any other
name);
(d) any sum which by reason of the termination of
employment of the person employed is payable under
any law, contract or instrument which provides for the
payment of such sum, whether with or without
deductions but does not provide for the time within
which the payment is to be made;
(e) any sum to which the person employed is entitled under
any scheme framed under any law for the time being in
force;
but does not include—
(1) any bonus (whether under a scheme of profit sharing or
otherwise) which does not form part of the remuneration payable
under the terms of employment or which is not payable under
any award or settlement between the parties or order of a Court;
(2) the value of any house-accommodation, or of the supply of light,
water, medical attendance or other amenity or of any service

1 Ins. by Act No.38 of 1982 (w.e.f.15.10.1982)

2 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
3 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
4 Subs. by Act 41 of 23005, sec. 4(b), for clause “(v)” railway administration” has the
meaning assigned to it in clause (6) of section 3 of the Indian Railways Act, 1890 (9 of
1890), and”.
5 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
4 The Payment of Wages Act, 1936 Sec. 3

excluded from the computation of wages by a general or special

order of 1[the appropriate Government];
(3) any contribution paid by the employer to any pension or
provident fund, and the interest which may have accrued
thereon;
(4) any travelling allowance or the value of any travelling
concession;
(5) any sum paid to the employed person to defray special expenses
entailed on him by the nature of his employment; or
(6) any gratuity payable on the termination of employment in cases
other than those specified in sub-clause (d)]

2
[3. Responsibility for payment of wages.- Every employer shall be
responsible for the payment of all wages required to be paid under this Act to
persons employed by him and in case of persons employed,--
(a) in factories, if a person has been named as the manager of the
factory under [clause (f) of sub-section (1) of Section 7 of the
Factories Act, 1948 (63 of 1948)];
[(b) in industrial or other establishments, if there is a person
responsible to the employer for the supervision and control of the
industrial or other establishments;]
(c) upon railways (otherwise than in factories) if the employer is the
railway administration and the railway administration has
nominated a person in this behalf for the local area concerned.
(d) in the case of contractor, a person designated by such contractor
who is directly under his charge; and
(e) in any other case, a person designated by the employer, the
person so nominated or the person so designated, as the case
may be, shall be responsible for such payment.
the person so named, and the person so responsible to the employer, or the
person so nominated, as the case may be, 3[shall also be responsible] for such
payment.
(2) Notwithstanding anything contained in sub-section (1), it shall be the
responsibility of the employer to make payment of all wages required to be made
under this Act in case the contractor or the person designated by the employer
fails to make such payment.]

4. Fixation of wage-periods.- (1) Every person responsible for the payment of

wages under Section 3 shall fix periods (in this Act referred to as wage-periods) in
respect of which such wages shall be payable.
(2) No wage-period shall exceed one month.
5. Time of payment of wages.- (1) The wages of every person employed upon
or in -
(a) any railway, factory or 4[industrial or other establishment] upon
or in which less than one thousand persons are employed, shall be
paid before the expiry of the seventh day.

1 Subs. by Act 41 of 2005, sec. 3 for “The State Government” (w.e.f 09-11-2005)
2 Subs. by Act 41 of 2005, sec. 5 (w.e.f 09-11-2005)
3 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
4 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
Sec. 7 The Payment of Wages Act, 1936 5

(b) any other railway, factory or 1[industrial or other establishment,

shall be paid before the expiry of the tenth day,
after the last day of the wage-period in respect of which the wages are payable:
2
[Provided that in the case of persons employed on a dock, wharf or jetty or
in a mine, the balance of wages found due on completion of the final tonnage
account of the ship or wagons loaded or unloaded, as the case may be, shall be
paid before the expiry of the seventh day from the day of such completion.]
(2) Where the employment of any person is terminated by or on behalf of the
employer, the wages earned by him shall be paid before the expiry of the second
working day from the day on which his employment is terminated:
3
[Provided that where the employment of any person in an establishment is
terminated due to the closure of the establishment for any reason other than a
weekly or other recognised holiday, the wages earned by him shall be paid before
the expiry of the second day from the day on which his employment is so
terminated.]
(3) The 4[5[The appropriate Government] may, by general or special order,
exempt, to such extent and subject to such conditions as may be specified in the
order, the person responsible for the payment of wages to persons employed
upon any, railway (otherwise than in a factory) 6[or to persons employed as daily-
daily-rated workers in the Public Works Department of 7[the appropriate
Government] from the operation of this section in respect of the wages of any
such persons or class of such persons:
8
[Provided that in the case of persons employed as daily-rated workers as
aforesaid, no such order shall be made except in consultation with the Central
Government;]
(4) 9[Save as otherwise provided in sub-section (2), all payments] of wages
shall be made on a working day.
6. Wages to be paid in current coin or currency notes.- All wages shall be paid in
current coin or currency notes or in both:
10
[Provided that the employer may, after obtaining the written authorisation of
the employed person, pay him the wages either by cheque or by crediting the
wages in his bank account.]
7. Deductions which may be made from wages.- (1) Notwithstanding the provisions
of 11[the Railways Act, 1989 (24 of 1989)], the wages of an employed person shall
be paid to him without deduction of any kind except those authorised by or
under this Act.

1 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)

2 Added by Act No.53 of 1964 (w.e.f. 1.2.1965)
3 Added by Act No.53 of 1964 (w.e.f. 1.2.1965)
4 Subs. by the A.O. 1937, for “Governor-General in Council”
5 Subs. by Act 41 of 2005, sec. 3 for “the State Government” (w.e.f 09-11-2005)
6 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
7 Substituted by the Payment of Wages (Amendment) Act, 2005 (41 of 2005), S.3,
for “the State Government or the Central Government” (w.e.f 09-11-2005).
8 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
9 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
10 Ins. by Act No.29 of 1976 (w.e.f. 12.11.1975)
11 Subs. by Act 41 of 2005, sec. 6(a) for “sub-section (2) of section 47 of the Indian
Railways, Act, 1890 (9 of 1890)”.3 for “the State Government” (w.e.f 09-11-2005)
6 The Payment of Wages Act, 1936 Sec. 7

1
[Explanation I].- Every payment made by the employed person to the
employer or his agent shall, for the purposes of this Act, be deemed to be a
deduction from wages.
2
[Explanation II.- Any loss of wages resulting from the imposition, for good
and sufficient cause, upon a person employed of any of the following penalties,
namely—
(i) the withholding of increment or promotion (including the
stoppage of increment at an efficiency bar);
(ii) the reduction to a lower post or time-scale or to a lower stage in
a time-scale; or
(iii) suspension;
shall not be deemed to be a deduction from wages in any case where the rules
framed by the employer for the imposition of any such penalty are in conformity
with the requirements, if any, which may be specified in this behalf by the State
Government by notification in the Official Gazette.]
(2) Deductions from the wages of an employed person shall be made only in
accordance with the provisions of this Act, and may be of the following kinds
only, namely-
(a) fines;
(b) deduction for absence from duty;
(c) deductions for damage to or loss of goods expressly entrusted to
the employed person or custody; or for loss of money for which he
is required to account, where such damage or loss is directly
attributable to his neglect or default;
3
[(d) deductions for house-accommodation supplied by the employer
or by Government or any housing board set up under any law for
the time being in force (whether the Government or the board is
the employer or not) or any other authority engaged in the
business of subsidising house-accommodation which may be
specified in this behalf by 4[the appropriate Government] by
notification in the Official Gazette;]
(e) deductions for such amenities and services supplied by the
employer as the 5[***] State Government 6[or any officer specified
specified by it in this behalf] may, by general or special order
authorise.
Explanation.- The word “services” in 7[this clause] does not include the
supply of tools and raw materials required for the purposes of employment;
8
[(f) deductions for recovery of advances of whatever nature
(including advances for travelling allowance or conveyance
allowance), and the interest due in respect thereof, or for
adjustment of over-payments of wages;

1 Re-numbered by Act No.68 of 1957 (w.e.f. 1.4.1958)

2 Ins. by Act No.68 of 1957 (w.e.f. 1.4.1958)
3 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
4 Substituted by the Payment of Wages (Amendment) Act, 2005 (41 of 2005), S.3,
for “the State Government” (w.e.f 09-11-2005).
5 Omitted by the A.O. 1937
6 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
7 Subs. by Act No.56 of 1974, sec. 3 and Sch. II, for “this sub-clause”
8 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
Sec. 7 The Payment of Wages Act, 1936 7

(ff) deductions for recovery of loans made from any fund constituted
for the welfare of labour in accordance with the rules approved
by the State Government, and the interest due in respect thereof;
(fff) deductions for recovery of loans granted for house-building or
other purposes approved by the State Government and the
interest due in respect thereof;]
(g) deductions of income-tax payable by the employed person;
(h) deductions required to be made by order of a Court or other
authority competent to make such order;
(i) deductions for subscriptions to, and for payment of advances
from any provident fund to which the Provident Funds Act, 1925
(19 of 1925), applies or any recognised provident fund as defined
1
[in clause (38) of section 2 of the Income-tax Act, 1961 (43 of
1961) or any provident fund approved in this behalf by 2[the
appropriate Government], during the continuance of such
approval; 3[***]
(j) deductions for payments to co-operative societies approved by
4
[the appropriate Government] 5[or any officer specified by it in
this behalf] or to a scheme of insurance maintained by the
Indian Post Office; 6[and];
7 8
[ (k) deductions, made with the written authorisation of the person
employed for payment of any premium on his life insurance
policy to the Life Insurance Corporation of India established
under the Life Insurance Corporation Act, 1956 (31 of 1956), or
for the purchase of securities of the Government of India or of
any State Government or for being deposited in any Post Office
Savings Bank in furtherance of any savings scheme of any such
Government;]
9
[(kk) deductions made, with the written authorisation of the employed
person, for the payment of his contribution to any fund
constituted by the employer or a trade union registered under
the Trade Unions Act, 1926 (16 of 1926) for the welfare of the
employed persons or the members of their families, or both, and
approved by 10[the appropriate Government], or any officer
specified by it in this behalf, during the continuance of such
approval;
(kkk) deductions made, with the written authorisation of the employed
person, for payment of the fees payable by him for the

1 Subs. by Act 41 of 2005, sec. 6(b), for “in section 58A of the Indian Income Tax
Act, 1922 (11 of 1922) (w.e.f 09-11-2005)
2 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
3 Omitted by Ordinance 3 of 1940
4 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
5 Ins. by Act No.53 of 1964 (w.e.f. 1.4.1965)
6 Added by Ordinance 3 of 1940
7 Added by Ordinance 3 of 1940, sec. 2.
8 Subs. by Act No.68 of 1957 (sec. 5, for clause (k) (w.e.f. 1-4-1958)
9 Ins. by Act 38 of 1982 (w.e.f. 15.10.1982)
10 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
8 The Payment of Wages Act, 1936 Sec.

membership of any trade union registered under the Trade

Unions Act, 1926 (16 of 1926);
1
[(l) deductions for payment of insurance premia on Fidelity
Guarantee Bonds;
(m) deductions for recovery of losses sustained by a railway
administration on account of acceptance by the employed person
of counterfeit or base coins or mutilated or forged currency
notes;
(n) deductions for recovery of losses sustained by a railway
administration on account of the failure of the employed person
to invoice, to bill, to collect or to account for the appropriate
charges due to that administration, whether in respect of fares,
freight, demurrage, wharfage and cranage or in respect of sale of
food in catering establishments or in respect of commodities in
grain shops or otherwise;
(o) deductions for recovery of losses sustained by a railway
administration on account of any rebates or refunds incorrectly
granted by the employed person where such loss is directly
attributable to his neglect or default.]
2
[(p) deductions, made with the written authorisation of the employed
person, for contribution to the Prime Minister's National Relief
Fund or to such other Fund as the Central Government may, by
notification in the Official Gazette, specify.]
3
[(q) deductions for contributions to any insurance scheme framed by
the Central Government for the benefit of its employees.]
4
[(3) Notwithstanding anything contained in this Act, the total amount of
deductions which may be made under sub-section (2) in any wage-period from
the wages of any employed person shall not exceed-
(i) in cases where such deductions are wholly or partly made for
payments to co-operative societies under clause (j) of sub-section
(2), seventy-five per cent of such wages, and
(ii) in any other case, fifty per cent of such wages:
Provided that where the total deductions authorised under sub-section (2)
exceed seventy-five per cent or, as the case may be, fifty per cent of the wages,
the excess may be recovered in such manner as may be prescribed.
(4) Nothing contained in this section shall be construed as precluding the
employer from recovering from the wages of the employed person or otherwise
any amount payable by such person under any law for the time being in force
other than 5[the Railways Act, 1989 (24 of 1989)].

8. Fines.- (1) No fine shall be imposed on any employed person save in

respect of such acts and omissions on his part as the employer with the previous

1 Ins. by Act No.53 of 1964 (w.e.f. 1.4.1965)

2 Ins. by Act No.29 of 1976 (w.e.f. 12.11.1975
3 Ins. by Act No.19 of 1977 (w.e.f. 30.6.1977)
4 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
5 Subs. by Act 41 of 2005, sec. 6(c) for “the Indian Railways, Act, 1890 (9 of 1890)”
(w.e.f 09-11-2005)
Sec. 9 The Payment of Wages Act, 1936 9

approval of 1[the appropriate Government] or of the prescribed authority, may

have specified by notice under sub-section (2).
(2) A notice specifying such acts and omissions shall be exhibited in the
prescribed manner on the premises in which the employment is carried on or in
the case of persons employed upon a railway (otherwise than in a factory), at the
prescribed place or places.
(3) No fine shall be imposed on any employed person until he has been given
an opportunity of showing cause against the fine, or otherwise than in
accordance with such procedure as may be prescribed for the imposition of fines.
(4) The total amount of fine which may be imposed in any one wage- period
on any employed person shall not exceed an amount equal to 2[three per cent] of
the wages payable to him in respect of that wage-period.
(5) No fine shall be imposed on any employed person who is under the age of
fifteen years.
(6) No fine imposed on any employed person shall be recovered from him by
instalments or after the expiry of 3[ninety days] from the day on which it was
imposed.
(7) Every fine shall be deemed to have been imposed on the day of the act or
omission in respect of which it was imposed.
(8) All fines and all realisations thereof shall be recorded in a register to be
kept by the person responsible for the payment of wages under Section 3 in such
form as may be prescribed; and all such realisations shall be applied only to such
purposes beneficial to the persons employed in the factory or establishment as
approved by the prescribed authority.
Explanation.- When the persons employed upon or in any railway, factory or
4
[industrial or other establishment] are part only of a staff employed under the
same management, all such realisations may be credited to a common fund
maintained for the staff as a whole, provided that the fund shall be applied only to
such purposes as are approved by the prescribed authority.
9. Deductions for absence from duty.- (1) Deductions may be made under clause
(b) of sub-section (2) of Section 7 only on account of the absence of an employed
person from the place or places where, by the terms of his employment, he is
required to work, such absence being for the whole or any part of the period during
which he is so required to work.
(2) The amount of such deduction shall in no case bear to the wages payable to
the employed person in respect of the wage-period for which the deduction is
made a larger proportion than the period for which he was absent bears to the
total period, within such wage-period, during which by the terms of his
employment, he was required to work:
Provided that, subject to any rules made in this behalf by 5[the appropriate
Government], if ten or more employed persons acting in concert, absent
themselves without due notice (that is to say without giving the notice which is
required under the terms of their contracts of employment) and without
reasonable cause, such deduction from any such person may include such

1 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
2 Subs. by Act 38 of 1982
3 Subs. by Act 41 of 2005, sec. 7, for “sixty days” (w.e.f 09-11-2005)
4 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
5 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
10 The Payment of Wages Act, 1936 Sec.

amount not exceeding his wages for eight days as may by any such terms be due to
the employer in lieu of due notice.
1
[Explanation.- For the purposes of this section, an employed person shall be
deemed to be absent from the place where he is required to work if, although
present in such place, he refuses, in pursuance of a stay-in strike or for any
other cause which is not reasonable in the circumstances, to carry out his work].

10. Deductions for damage or loss.- 2[(1) A deduction under clause (c) or
clause (o) of sub-section (2) of Section 7 shall not exceed the amount of the
damage or loss caused to the employer by the neglect or default of the employed
person.
(1-A) A deduction shall not be made under clause (c) or clause (m) or clause
(n) or clause (o) of sub-section (2) of Section 7 until the employed person has
been given an opportunity of showing cause against the deduction, or otherwise
than in accordance with such procedure as may be prescribed for the making of
such deductions.]
(2) All such deductions and all realisations thereof shall be recorded in a
register to be kept by the person responsible for the payment of wages under
Section 3 in such form as may be prescribed.

11. Deductions for services rendered.- A deduction under clause (d) or

clause (e) of sub-section (2) of Section 7 shall not be made from the wages of an
employed person, unless the house-accommodation amenity of service has been
accepted by him, as a term of employment or otherwise, and such deduction
shall not exceed an amount equivalent to the value of the house-accommodation
amenity or service supplied and, in the case of a deduction under the said clause
(e) shall be subject to such conditions as 3[****] 4[the appropriate Government]
may impose.
12. Deductions for recovery of advances.- Deductions under clause (f) of
sub-section (2) of Section 7 shall be subject to the following conditions, namely-
(a) recovery of an advance of money given before employment began
shall be made from the first payment of wages in respect of a
complete wage-period, but no recovery shall be made of such
advances given for travelling expenses;
5
[(aa) recovery of an advance of money given after employment began
shall be subject to such conditions as 6[the appropriate
Government], may impose];
(b) recovery of advances of wages not already earned shall be
subject to any rules made by 7[the appropriate Government]
regulating the extent to which such advances may be given and
the instalments by which they may be recovered.

1 Added by Act No.22 of 1937

2 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
3 Omitted by the A.O. 1937
4 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
5 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
6 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
7 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
Sec. 14 The Payment of Wages Act, 1936 11

1
[12A. Deductions for recovery of loans.- Deductions for recovery of loans granted
under clause (fff) of sub-section (2) of Section 7 shall be subject to any rules
made by 2[the appropriate Government] regulating the extent to which such loans
may be granted and the rate of interest payable thereon.]
13. Deductions for payments to co-operative societies and insurance
schemes.- Deductions under clause (j) 3[and clause (k)] of sub-section (2) of
Section 7 shall be subject to such conditions as the State Government may
impose.
4
[13A. Maintenance of registers and records.- (1) Every employer shall maintain
such registers and records giving such particulars of persons employed by him, the
work performed by them, the wages paid to them, the deductions made from
their wages, the receipts given by them and such other particulars and in such
form as may be prescribed.
(2) Every register and record required to be maintained under this section
shall, for the purposes of this Act, be preserved for a period of three years after
the date of the last entry made therein].

14. Inspectors.- (1) An Inspector of Factories appointed under 5[sub-section

section (1) of Section 8 of the Factories Act, 1948 (63 of 1948)], shall be an
Inspector for the purposes of this Act in respect of all factories within the local
limits assigned to him.
(2) 6[the appropriate Government], may appoint Inspectors for the purposes of
this Act in respect of all persons employed upon a railway (otherwise than in a
factory) to whom this Act applies.
(3) 7[the appropriate Government], may, by notification in the Official
Gazette, appoint such other persons as it thinks fit to be Inspectors for the
purposes of this Act, and may define the local limits within which and the class of
factories and 8[industrial or other establishments] in respect of which they shall
exercise their functions.
9
[(4) An Inspector may,-
(a) make such examination and inquiry as he thinks fit in order to
ascertain whether the provisions of this Act or rules made
thereunder are being observed;
(b) with such assistance, if any, as he thinks fit, enter, inspect and
search any premises of any railway, factory or 10[industrial or
other establishment] at any reasonable time for the purpose of
carrying out the objects of this Act;

1 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
3 Ins. by Ordinance of 1940
4 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
5 Subs by Act No.68 of 1957 (w.e.f. 1.4.1958)
6 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
7 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
8 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
9 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
10 Subs. by Act 38 of 1982 S.9 (w.e.f. 15.10.1982)
12 The Payment of Wages Act, 1936 Sec. 14A

(c) supervise the payment of wages to persons employed upon any

railway or in any factory or 1[industrial or other establishment];
(d) require by a written order the production at such place, as may
be prescribed, of any register or record maintained in pursuance
of this Act and take on the spot or otherwise statements of any
persons which he may consider necessary for carrying out the
purposes of this Act;
(e) seize or take copies of such registers or documents of portions
thereof as he may consider relevant in respect of an offence
under this Act which he has reason to believe has been
committed by an employer;
(f) exercise such other powers as may be prescribed:
Provided that no person shall be compelled under this sub-section to answer
any question or make any statement tending to incriminate himself.
(4-A) The provisions of the 2[Code of Criminal Procedure, 1973 (2 of 1974)],
shall, so far as may be, apply to any search or seizure under this sub- section as
they apply to any search or seizure made under the authority of a warrant issued
under 3[Section 94] of the said Code.]
(5) Every Inspector shall be deemed to be a public servant within the
meaning of the Indian Penal Code (45 of 1860).
4
[14A. Facilities to be afforded to Inspectors.- Every employer shall afford afford
an Inspector all reasonable facilities for making any entry, inspection,
supervision, examination or inquiry under this Act].
15. Claims arising out of deductions from wages or delay in payment of wages and
penalty for malicious or vexatious claims.- (1) 5[the appropriate Government], may, by
notification in the Official Gazette, appoint
(a) any Commissioner for Workmen's Compensation; or
(b) any officer of the Central Government exercising functions as,—
(i) Regional Labour Commissioner; or
(ii) Assistant Labour Commissioner with at least two years‟
experience; or
(c) any officer of the State Government not below the rank of
Assistant Labour Commissioner with at least two years
experience; or
(d) a presiding officer of any Labour Court or Industrial Tribunal,
constituted under the Industrial Disputes Act, 1947 (14 of 1947) or
under any corresponding law relating to the investigation and
settlement of industrial disputes in force in the State; or
(e) any other officer with experience as a Judge of a Civil Court or a
Judicial Magistrate,
as the authority to hear and decide for any specified area all claims arising out of
deductions from the wages, or delay in payment of the wages of persons
employed or paid in that area, including all matters incidental to such claims:

1 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)

2 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
3 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
4 Inserted by the Payment of Wages (Amendment) Act, 1964, w.e.f. 1-2-1965
5 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
Sec. 15 The Payment of Wages Act, 1936 13

Provided that where the State Government considers it necessary so to do, it

may appoint more than one authority for any specified area and may, by general or
special order, provide for the distribution or allocation of work to be performed by
them under this Act.]
(2) Where contrary to the provisions of this Act any deduction has been
made from the wages of an employed person, or any payment of wages has been
delayed, such person himself, or any legal practitioner or any official of a
registered trade union authorised in writing to act on his behalf, or any Inspector
under this Act, or any other person acting with the permission of the authority
appointed under sub-section (1), may apply to such authority for a direction
under sub-section (3):
1
Provided that every such application shall be presented within [twelve
months] from the date on which the deduction from the wages was made or from
the date on which the payment of the wages was due to be made, as the case
may be:
Provided further that any application may be admitted after the said period of
2
[twelve months] when the applicant satisfies the authority that he had
sufficient cause for not making the application within such period.
3
[(3) When any application under sub-section (2) is entertained, the
authority shall hear the applicant and the employer or other person responsible
for the payment of wages under section 3, or give them an opportunity of being
heard, and, after such further inquiry (if any) as may be necessary, may, without
prejudice to any other penalty to which such employer or other person is liable
under this Act, direct the refund to the employed person of the amount deducted,
or the payment of the delayed wages, together with the payment of such
compensation as the authority may think fit, not exceeding ten times the amount
deducted in the former case and not exceeding three thousand rupees but not
less than one thousand five hundred rupees in the latter, and even if the amount
deducted or delayed wages are paid before the disposal of the application, direct
the payment of such compensation, as the authority may think fit, not exceeding
two thousand rupees:
Provided that a claim under this Act shall be disposed of as far as
practicable within a period of three months from the date of registration of the
claim by the authority:
Provided further that the period of three months may be extended if both
parties to the dispute agree for any bona fide reason to be recorded by the
authority that the said period of three months may be extended to such period as
may be necessary to dispose of the application in a just manner:
Provided also that no direction for the payment of compensation shall be
made in the case of delayed wages if the authority is satisfied that the delay was
due to-
(a) a bona fide error or bona fide dispute as to the amount payable
to the employed person, or
(b) the occurrence of an emergency, or the existence of exceptional
circumstances, the person responsible for the payment of the
wages was unable, in spite of exercising reasonable diligence, or

1 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
3 Subs. by the Payment of Wages (Amendment) Act, 2005, sec. 8(ii)
14 The Payment of Wages Act, 1936 Sec.

(c) the failure of the employed person to apply for or accept

payment.
1
[(4) If the authority hearing an application under this section is satisfied—
(a) that the application was either malicious or vexatious, the
2
authority may direct that a penalty [not exceeding three
hundred seventy five rupees] be paid to the employer or other
person responsible for the payment of wages by the person
presenting the application; or
(b) that in any case in which compensation is directed to be paid
under sub-section (3), the applicant ought not to have been
compelled to seek redress under this section, the authority may
direct that a penalty 3[not exceeding three hundred seventy five
rupees] be paid to 4[the appropriate Government], by the
employer or other person responsible for the payment of wages.
(4-A) Where there is any dispute as to the person or persons being the legal
representative or representatives of the employer or of the employed person, the
decision of the authority on such dispute shall be final.
(4-B) Any inquiry under this section shall be deemed to be a judicial
proceeding within the meaning of Sections 193, 219 and 228 of the Indian Penal
Code (45 of 1860)].
(5) Any amount directed to be paid under this section may be recovered—
(a) if the authority is a Magistrate, by the authority as if it were a
fine imposed by him as Magistrate, and
(b) if the authority is not a Magistrate, by any Magistrate to whom
the authority makes application in this behalf, as if it were a fine
imposed by such Magistrate.

16. Single application in respect of claims from unpaid group.- (1) Employed
persons are said to belong to the same unpaid group if they are borne on the same
establishment and if 5[deductions have been made from their wages in contravention
of this Act for the same cause and during the same wage-period or periods or if]
their wages for the same wage-period or periods have remained unpaid after the
day fixed by Section 5.
(2) A single application may be presented under Section 15 on behalf or in
respect of any number of employed persons belonging to the same unpaid group,
and in such case 6[every person on whose behalf such application is presented
may be awarded maximum compensation to the extent specified in sub-section
(3) of Section (15)].
(3) The authority may deal with any number of separate pending
applications, presented under Section 15 in respect of persons belonging to the
same unpaid group, as a single application presented under sub-section (2) of
this section, and the provisions of that sub-section shall apply accordingly.

1 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act 41 of 2005, sec. 8 (iii) for “not exceeding fifty rupees” (w.e.f 09-11-
2005)
3 Subs. by Act 41 of 2005, sec. 8 (iii) for “not exceeding fifty rupees” (w.e.f 09-11-
2005)
4 Subs. by Act 41 of 2005, sec. 3, for “the State Government” (w.e.f 09-11-2005)
5 Ins. by Act No.53 of 1964 (w.e.f.1.2.1965)
6 Subs. by Act No.53 of 1964 (w.e.f.1.2.1965)
Sec. 17A The Payment of Wages Act, 1936 15

17. Appeal.- (1) 1[An appeal against an order dismissing either wholly or in
part an application made under sub-section (2) of Section 15, or against a
direction made under sub-section (3) or sub-section (4) of that section] may be
preferred within thirty days of the date on which 2[the order or direction] was
made, in a Presidency town 3[***] before the Court of Small Causes and elsewhere
before the District Court-
(a) by the employer or other person responsible for the payment of
wages under Section 3, if the total sum directed to be paid by
way of wages and compensation exceeds three hundred rupees
4
[or such direction has the effect of imposing on the employer or
the other person a financial liability exceeding one thousand
rupees], or
5
[(b) by an employed person, or any legal practitioner or any official of
a registered trade union authorised in writing to act on his
behalf or any Inspector under this Act, or any other person
permitted by the authority to make an application under sub-
section (2) of Section 15, if the total amount of wages claimed to
have been withheld from the employed person exceeds twenty-
rupees or from the unpaid group to which the employed person
belongs or belonged exceeds fifty rupees, or]
(c) by any person directed to pay a penalty under 6[sub-section (4)]
of Section 15.
7
[(1-A) No appeal under clause (a) of sub-section (1) shall lie unless the
memorandum of appeal is accompanied by a certificate by the Authority to the
effect that the appellant has deposited the amount payable under the direction
appealed against.]
8
[(2) Save as provided in sub-section (1), any order dismissing either wholly
or in part an application made under sub-section (2) of Section 15, or a direction
made under sub- section (3) or sub- section (4) of that section shall be final].
9
[(3) Where an employer prefers an appeal under this section, the Authority
against whose decision the appeal has been preferred may, and if so directed by
the court referred to in sub-section (1) shall, pending the decision of the appeal,
withhold payment of any sum in deposit with it.
(4) The court referred to in sub-section (1) may, if it thinks fit, submit any
question of law for the decision of the High Court and, if it so does, shall decide
the question in conformity with such decision.]
10
[17A. Conditional attachment of property of employer or other person
responsible for payment of wages.- (1) Where at any time after an application
has been made under sub-section (2) of Section 15 the authority, or where at any

1 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)

2 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
3 Omitted by A.O. 1937
4 Ins. by Act No.53 of 1964 (w.e.f.1.2.1965)
5 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
6 Subs. by Act No.20 of 1937 sec. 2 and sch. I, for “sub-section (5)”
7 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
8 Subs. by Act No.68 of 1957 (w.e.f. 1.4.1958)
9 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
10 Ins. by Act No. 68 of 1957 (w.e.f. 1.4.1958)
16 The Payment of Wages Act, 1936 Sec. 18

time after an appeal has been filed under Section 17 by an employed person or
1
[any legal practitioner or any official of a registered trade union authorised in
writing to act on his behalf or any Inspector under this Act or any other person
permitted by the authority to make an application under sub- section (2) of
Section 15] the Court referred to in that section, is satisfied that the employer or
other person responsible for the payment of wages under Section 3 is likely to
evade payment of any amount that may be directed to be paid under Section 15
or Section 17, the authority or the Court, as the case may be, except in cases,
where the authority or Court is of the opinion that the ends of justice would be
defeated by the delay, after giving the employer or other person an opportunity of
being heard, may direct the attachment of so much of the property of the
employer or other person responsible for the payment of wages as is, in the
opinion of the authority or Court, sufficient to satisfy the amount which may be
payable under the direction.
(2) The provisions of the Code of Civil Procedure 1908 (5 of 1908), relating to
attachment before judgment under that Code shall, so far as may be, apply to
any order for attachment under sub-section (1)].
18. Powers of authorities appointed under Section 15.- Every authority
appointed under sub-section (1) of Section 15 shall have all the powers of a Civil
Court under the Code of Civil Procedure, 1908 (5 of 1908), for the purpose of
taking evidence and of enforcing the attendance of witnesses and compelling the
production of documents, and every such authority shall be deemed to be a Civil
Court for all the purposes of Section 195 and of 2[Chapter XXVI of the Code of
Criminal Procedure, 1973] (2 of 1974)].
19. Power to recover from employer in certain cases]- [Repealed by the
Payment of Wages (Amendment) Act, 1964 (53 of 1964), sec. 17 (w.e.f. 1-2-1965).]
20. Penalty for offences under the Act.- (1) Whoever being responsible for
the payment of wages to an employed person contravenes any of the provisions of
any of the following sections, namely, 3[Section 5 except sub-section (4) thereof,
Section 7, Section 8 except sub-section (8) thereof, Section 9, Section 10, except
sub-section (2) thereof, and Sections 11 to 13], both inclusive, shall be
punishable 4[with fine which shall not be less than one thousand five hundred
rupees but which may extend to seven thousand five hundred rupees].
(2) Whoever contravenes the provisions of Section 4, 5[sub-section (4) of
Section 5, Section 6, sub- section (8) of Section 8, sub-section (2) of Section (10)] or
Section 25 shall be punishable 6[with fine which may extend to three thousand
thousand seven hundred fifty rupees].
7
[(2A) Whoever being required to nominate or designate a person under
section 3 fails to do so, such person shall be punishable with fine which may
extend to three thousand rupees.]

1 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act No.38 of 1982
3 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
4 Subs. by Act 41 of 2005, sec. 9 (a), for “with fine which shall not be less than two
hundred rupees but which may extend to one thousand rupees” (w.e.f 09-11-2005)
5 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
6 Subs. by Act 41 of 2005, sec. 9 (b), for “with fine which may extend to five
hundred rupees (w.e.f 09-11-2005)
7 Subs. by Act 41 of 2005, sec. 9 (c) (w.e.f 09-11-2005)
Sec. 20 The Payment of Wages Act, 1936 17

1
[(3) Whoever being required under this Act to maintain any records or
registers or to furnish any information or return,-
(a) fails to maintain such register or record; or
(b) wilfully refuses or without lawful excuse neglects to furnish such
information or return; or
(c) wilfully furnishes or causes to be furnished any information or
return which he knows to be false; or
(d) refuses to answer or wilfully gives a false answer to any question
necessary for obtaining any information required to be furnished
under this Act,
shall for each such offence, be punishable with fine 2[with fine which shall not be
less than one thousand five hundred rupees but which may extend to seven
thousand five hundred rupees].
(4) Whoever-
(a) wilfully obstructs an Inspector in the discharge of his duties
under this Act; or
(b) refuses or wilfully neglects to afford an Inspector any reasonable
facility for making any entry, inspection, examination,
supervision or (inquiry authorised by or under this Act in
relation to any railway, factory or 3[industrial or other
establishment]; or
(c) wilfully refuses to produce on the demand of an Inspector any
register or other document kept in pursuance of this Act; or
(d) prevents or attempts to prevent or does anything which he has
any reason to believe is likely to prevent any person from
appearing before or being examined by an Inspector acting in
pursuance of his duties under this Act,
shall be punishable 4[with fine which shall not be less than one thousand five
hundred rupees but which may extend to seven thousand five hundred rupees].
(5) If any person who has been convicted of any offence punishable under
this Act is again guilty of an offence involving contravention of the same
provision, he shall be punishable on a subsequent conviction with imprisonment
for a term 5[which shall not be less than one month but which may extend to six
months and 6[with fine which shall not be less than three thousand seven
hundred fifty rupees but which may extend to twenty two thousand five hundred
rupees] or with both:
Provided that for the purpose of this sub-section, no cognizance shall be
taken of any conviction made more than two years before the date on which the
commission of the offence which is being punished came to the knowledge of the
Inspector.

1 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act 41 of 2005, sec. 9 (d), for “with fine which shall not be less than two
hundred rupees but which may extend to one thousand rupees” (w.e.f 09-11-2005)
3 Subs. by Act No.38 of 1982 w.e.f. 15.10.1982
4 Subs. by Act 41 of 2005, sec. 9 (e), for “with fine which shall not be less than two
hundred rupees but which may extend to one thousand rupees” (w.e.f 09-11-2005)
5 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)
6 Subs. by Act 41 of 2005, sec. 9 (f), for “with fine which shall not be less than five
hundred rupees but which may extend to three thousand rupees (w.e.f 09-11-
2005)
18 The Payment of Wages Act, 1936 Sec.

(6) If any person fails or wilfully neglects to pay the wages of any employed
person by the date fixed by the authority in this behalf, he shall, without
prejudice to any other action that may be taken against him, be punishable with an
additional fine which may extend to 1[seven hundred fifty rupees] for each day for
which such failure or neglect continues].

21. Procedure in trial of offences.- (1) No Court shall take cognizance of a

complaint against any person for an offence under sub-section (1) of Section 20
unless an application in respect of the facts constituting the offence has been
presented under Section 15 and has been granted wholly or in part and the
authority empowered under the latter section or the appellate Court granting
such application has sanctioned the making of the complaint.
(2) Before sanctioning the making of a complaint against any person for an
offence under sub-section (1) of Section 20, the authority empowered under
Section 15 or the Appellate Court, as the case may be, shall give such person an
opportunity of showing cause against the granting of such sanction, and the
sanction shall not be granted if such person satisfies the authority or Court that
his default was due to-
(a) a bona fide error or bona fide dispute as to the amount payable
to the employed person, or
(b) the occurrence of an emergency, or the existence of exceptional
circumstances, such that the person responsible for the payment of
the wages was unable, though exercising reasonable diligence to
make prompt payment, or
(c) the failure of the employed person to apply for or accept
payment.
(3) No Court shall take cognizance of a contravention of Section 4 or of
Section 6 or of a contravention of any rule made under Section 26 except on a
complaint made by or with the sanction of an Inspector under this Act.
2
[(3A) No Court shall take cognizance of any offence punishable under sub-
section (3) or sub-section (4) of Section 20 except on a complaint made by or with the
sanction of an Inspector under this Act.]
(4) In imposing any fine for an offence under sub-section (1) of Section 20
the Court shall take into consideration the amount of any compensation already
awarded against the accused in any proceedings taken under Section 15.
22. Bar of suits.- No Court shall entertain any suit for the recovery of wages or of
any deduction from wages insofar as the sum so claimed—
(a) forms the subject of an application under Section 15 which has
been presented by the plaintiff and which is pending before the
authority appointed under that section or of an appeal under
Section 17; or
(b) has formed the subject of a direction under Section 15 in favour
of the plaintiff; or
(c) has been adjudged in any proceeding under Section 15, not to be
owed to the plaintiff; or
(d) could have been recovered by an application under Section 15.

1 Subs. by Act No.38 of 1982 (w.e.f. 15.10.1982)

2 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)
Sec. 25A The Payment of Wages Act, 1936 19

1
[22A. Protection of action taken in good faith.- No suit, prosecution or
other legal proceeding shall lie against the Government or any officer of the
Government for anything which is in good faith done or intended to the done
under this Act.]
23. Contracting out.- Any contract or agreement, whether made before or after
the commencement of this Act whereby an employed person relinquishes any
right conferred by this Act shall be null and void insofar as it purports to
deprive him of such right.
2
[24. Delegation of powers.-The appropriate Government may, by
notification in the Official Gazette, direct that any power exercisable by it under
this Act shall, in relation to such matters and subject to such conditions, if any, as
may be specified in the direction, be also exercisable--
(a) where the appropriate Government is the Central Government,
by such officer or authority subordinate to the Central
Government or by the State Government or by such officer or
authority subordinate to the State Government, as may be
specified in the notification;
(b) where the appropriate Government is a State Government, by
such officer or authority subordinate to the State Government as
may be specified in the notification.]
25. Display by notice of abstracts of the Act.- The person responsible for
the payment of wages to persons 3[employed in a factory or an industrial or other
establishment] shall cause to be 4[displayed in such factory or industrial or other
establishment] a notice containing such abstracts of this Act and of the rules
made thereunder in English and in the language of the majority of the persons
employed in the factory 5[or industrial or other establishment], as may be
prescribed.
6
[25A. Payment of undisbursed wages in cases of death of employed
person.- (1) Subject to the other provisions of the Act, all amounts payable to an
employed person as wages shall, if such amounts could not or cannot be paid on
account of his death before payment or on account of his whereabouts not being
known,-
(a) be paid to the person nominated by him in this behalf in
accordance with the rules made under this Act; or
(b) where no such nomination has been made or where for any
reasons such amounts cannot be paid to the person so
nominated, be deposited with the prescribed authority who shall
deal with the amounts so deposited in such manner as may be
prescribed.]
(2) Where, in accordance with the provisions of sub-section (1), all amounts
payable to an employed person as wages-

1 Ins. by Act No.53 of 1964 (w.e.f. 1.2.1965)

2 Subs. by Act 41 of 2005, sec. 10, (w.e.f 09-11-2005)
3 Subs. by Act No.38 of 1982
4 Subs. by Act No.38 of 1982
5 Ins. by Act No.38 of 1982
6 Ins. by Act No.38 of 1982
20 The Payment of Wages Act, 1936 Sec. 26

(a) are paid by the employer to the person nominated by the

employed person; or
(b) are, deposited by the employer with the prescribed authority, the
employer shall be discharged of his liability to pay those wages.
26. Rule-making power.- (1) 1[2[The appropriate Government] may make rules
3
[***] to regulate the procedure to be followed by the authorities and Courts referred
to in Sections 15 and 17.
(2) 4[5[The appropriate Government] may 6[***] by notification in the Official
Official Gazette make rules for the purpose of carrying into effect the provisions
of this Act.
(3) In particular and without prejudice to the generality of the foregoing
power, rules made under sub-section (2) may-
(a) require the maintenance of such records, registers, returns and
notices as are necessary for the enforcement of the Act
7
[prescribe the form thereof and the particulars to be entered in
such registers or records];
(b) require the display in a conspicuous place or premises where
employment is carried on of notices specifying rates of wages
payable to persons employed on such premises;
(c) provide for the regular inspection of the weights, measures and
weighing machines used by employers in checking or
ascertaining the wages of persons employed by them.
(d) prescribe the manner of giving notice of the days on which wages
will be paid;
(e) prescribe the authority competent to approve under sub- section
(1) of section 8 acts and omissions in respect of which fines may be
imposed;
(f) prescribe the procedure for the imposition of fines under Section
8 and for the making of the deductions referred to in Section 10;
(g) prescribe the conditions subject to which deductions may be
made under the proviso to sub-section (2) of Section 9;
(h) prescribe the authority competent to approve the purposes on
which the proceeds of fines shall be expended;
(i) prescribe the extent to which advances may be made and the
instalments by which they may be recovered with reference to
clause (b) of Section 12;
8
[(i-a) prescribe the extent to which loans may be granted and the rate
of interest payable thereon with reference to Section 12-A;
(i-b) prescribe the powers of Inspectors for the purposes of this Act;]
(j) regulate the scales of costs which may be allowed in proceedings
under this Act;

1 Subs. by the A.O. 1937, for “Governor-General in Council”

2 Subs. by Act 41 of 2005, sec. 3, for “The State Government” (w.e.f 09-11-2005)
3 Omitted by A.O. 1937
4 Subs. by the A.O. 1937, for “Governor-General in Council”
5 Subs. by Act 41 of 2005, sec. 3, for “The State Government” (w.e.f 09-11-2005)
6 Omitted by A.O.1973
7 Subs. by Act No.53 of 1964 (w.e.f. 1.2.1965)
8 Ins. by Act No. 53 of 1964 (w.e.f. 1.2.1965)
Sec. 26 The Payment of Wages Act, 1936 21

(k) prescribe the amount of court-fees payable in respect of any

proceedings under this Act; 1[***]
(l) prescribe the abstracts to be contained in the notices required by
Section 25; 2[***]
3
[(la) prescribe the form and manner in which nominations may be
made for the purposes of sub-section (1) of Section 25A, the
cancellation or variation of any such nomination, or the making
of any fresh nomination in the event of the nominee predeceasing
the person making nomination, and other matters connected
with such nominations;
(lb) specify the authority with whom amounts required to be
deposited under clause (b) of sub-section (1) of Section 25A, shall be deposited and the manner in which such authority
shall deal with the amounts deposited with it under that clause],
4
[(m) provide for any other matter which is to be or may be prescribed]
(4) In making any rule under this section the State Government may provide that a contravention of the rule shall be punishable
with fine 5[which shall not be be less than seven hundred fifty rupees but which may extend to one thousand and five hundred
rupees].
(5) All rules made under this section shall be subject to the condition of previous publication, and the date to be specified
under clause (3) of Section 23 of the General Clauses Act, 1897 (10 of 1897) shall not be less than three months from the date on which
the draft of the proposed rules was published.
6
[(6) Every rule made by the Central Government under this section shall be
be laid, as soon as may be after it is made, before each House of Parliament while
it is in session for a total period of thirty days which may be comprised in one
7
session or in [two or more successive sessions], and if, before the expiry of the
8
session [immediately following the session or the successive sessions aforesaid]
both Houses agree in making any modification in the rule, or both Houses agree
that the rule should not be made, the rule shall thereafter have effect only in
such modified form or be of no effect, as the case may be; so however that any
such modification or annulment shall be without prejudice to the validity of
anything previously done under that rule.]
9
[(7) All rules made under this section by the State Government shall, as soon as possible after they are made, be laid before the
State Legislature.]

PAYMENT OF WAGES ACT, 1936

The Payment of Wages Act ensures that the wages payable to employees covered by
the Act are disbursed by the employers within the prescribed time limit and that no
deductions other that those authorised by law made by the employers.

(1) Applicability

(i) The Act applied to persons whose wages do not exceed Rs.1600/- per
month and who are employed in.

(a) Any factory :

(b) Any railway by a railway adminstration either directly or through a sub

contractor.

(c) Any industrial establishment or any class or group of industrial

establishments defined in the Act.

(2) Wages

Wages means all remuneration expressed in terms of money and includes

payment under any award or settlement and payment in respect of overtime, work and
holidays. This, however, does not include value of house accommodation, light, water,
medical facilities, travelling allowances, travel concession, employers contribution to
Providend Fund (PF) or pension.

(3) Payment of Wages

(i) Wage periods should be fixed and no wage period should exceed one
month.

(ii) Wages must be paid before the expiry of the seventh day after the wage
period if less than 1000 persons are employed and 10 days if more than
1000 persons are employed.

(iii) Where the employment of any person is teminated the wages earned by
him should be paid before the expiry of the second working day from the
date on which the termination was efffected.

(iv) All payment of wage shall be made on a working day.

(v) All wages shall be made in currency notes or coins or in both unless a
written authorisation is made by the employee that he may be paid either by
cheque or by crediting the wages in bank account.

ix
(4) Deductions

The deductions allowed under this Act are -

(a) Fines

(b) Deductions for absence from duty

(c) Deductions for damage to or loss of goods or loss of money expressly

entrusted to the employee;

(d) Deductions for house accomodation ;

(e) Deductions for recovery of loans and advances ;

(f) Deductions of income tax

(g) Deductions required to be made by order of Court or other competent

authority ;

(h) Deduction for subscription to and for repayment of advances from

Provident Fund ;

Deductions for payment to co-operative societies ;

Deduction for LIC, or any insurance scheme framed by the Central Govt.
made with the written authorisation the employee ;

(k) Deductions made with the written authorisation of the employee for
contribution to any funds constituted by the employee or a registered
trade union for the welfare of the employed persons or the members of
their families or both ;

(1) Deductions made with the written authorisation of the employee for
payment of fees for the membership of any registered Trade Union ;

(5) Fines

No fine shall be imposed on any person until he has been given an opportunity of
showing cause against the fine ;

(a) The total amount of fine in any wage period shall not exceed 3% of the
wages payable in that period ;

(b) No fine shall be imposed on those who are less than 15 years of age.

(c) No fine imposed on any person shall be recovered by instalments or after

the expiry of 60 days from the day on which it was imposed ;
(6) Maintenance of registers and rcords

(i) Every employer shall maintain registers and records giving particulars of
persons employed by him, work performed by them, wages paid to them,
deductions made from their wages and other such particulars in the
prescribed form.

(ii) Every registers and records to be maintained under this Act shall be
preserved for 3 years after the date of the last entry made in them.

(iii) Abstracts of this Act and the rules made there under are to be displayed in
English and in the language of the majority of the- persons employed in
the factory.

(7) Penalty

(a) Whoever -

(i) Fails to maintain registers or records required under the Act ; or

(ii) Wilfully refuses or without lawful excuse neglects to furnish such

information or returns ; or

(iii) Wilfully furnishes false information or returns ; or

(iv) Refuses to answer or wilfully give false answers for obtaining any
information required under this Act ; or

(v) Wilfully obstructs an inspector in the discharge of his duties ; or

(v ) Wilfully refuses to produce on the demand of an Inspector any register or

other document kept in pursuance of this Act ;

(vii) Prevents or attempts to prevent any person appearing before or being

examined by an Inspector.

Shall, for each such offence, be punishable with a fine which shall not be
less than Rs.200/- but may extend to be Rs.1000/-.

(b) If any person wilfully neglects to pay the wages of any employed person
by the date fixed by the authority he shall be punishable with a fine which
may extend to Rs.100/- for each day for which the failure or neglect
continues.

xi
 Appendix-IV

THE MINIMUM WAGES ACT, 1948

(1) Definition :

(i) Employer means any person who employs directly or indirectly, for
himself or for someone else, one or more employees, in any scheduled
exployment in regard to which mimimum rates of wages have been fixed
under this Act, and includes a manager, authority appointed by the
Government or the local authority.

(ii) Scheduled Employment : It means employment specified in the schedule

or any process or branch of work forming part of such employment. The
industries covered in the Scheduled Employment include woollen carpet-
making, shawl weaving, rice flour, dal, mills, tabacco manufacturing,
plantation, oil mill, employment under any local authority, construction
and maintenance of roads, building operations, stone-breaking or stone-
crushing, lac manufacturing, mica works, public motor transport,
tanneries and leather manufacturing, residential hotels, restaurants or
eating houses, printing presses, book-binding, cotton spinning, pressing,
refractory, ceramic and pottery, shops and commercial establishments,
cinema industry, agriculture, dairy farming, raising of live stocks, bees or
poultry and any practice performed by a farmer on a farm as incidential to or,
in conjunction with farm operations (including forestry or timbering), etc.

(iii) Wages : means all remuneration capable of being expressed in terms and
of money payable to an employee. It includes house rent allowance, but
does not include other amenities, such as provident fund or any such
contributions paid by the employer for gratuity etc.

(iv) Employee : means any person who is employed for hire or reward to do
any work, skilled or unskilled, manual or clerical in a scheduled
employment in respect to which mimimum rate of wages have been fixed
and include an out worker to whom articles or materials are given by
another person for processsing.

(2) Mimimum Rate of Wages :

(i) The appropriate Government may fix rates of wages for fine work and for
piece work.

(ii) The appropriate government may fix different mimimum rates wages :-

(a) for different schedules or employment, different classes or work in the

same scheduled employment for adults, adolescents, children and
apprentices ; and for different localities.

xii
 (b) for any one or more of the following wage periods:-

(i) by the hour

(ii) by the day
(iii) by the month
(iv) by such other large wage period as may be prescribed.

(3) The rate fixed is reviewed at intervals and revised, if necessary.

Payment of Minimum Wages :

(a) The employer must pay every employee wages at a rate not less than the
minimum rate of wages, fixed by notification for that class of employees.

(1)) Payment of wages under this Act must be in cash except where the
Government, by a notification has authorised either part of full
payment in kind.

(c) The manner of estimating the cash value of wages in kind and of
concessions is to get the prices form the nearest market and
compute accordingly.

(4) Time and Conditions of Payment :

(a) Wages must be paid within one month -

(i) Before the expiry of the 7th day if the employer has less than
1000 employees or

(ii) Before the expiry of the 10th day in other cases.

(b) Persons whose services are terminated must be paid before the next
working day ends.

(5) Deductions :

The following deductions are allowed to he made from the wages payable to the
emplyces :

(a) Fines peritted under the Rules :

(b) Deductions for ;

(i) Absence from duty

( Damage to or loss of goods or money expressly entrusted to the

employee which is directly attributable to his neglect or default.
 4.1 FACTORIES ACT, 1948
Introduction

Factories Act is one of the earliest labour welfare legislations. The object of the act is to secure
health, safely, welfare, proper working hours, and other benefits to workers. The Act requires
that workers should work in healthy and sanitary conditions and for that purposes. It provides
that precaution should be taken for safety of workers and prevention of accidents.

Meaning of Factory

Factory means any premises, including the precincts thereof, in any part of which manufacturing
process is carried on with or without the aid of power, provided that at least 10 or 20 persons
respectively are employed or were employed on any day of the preceding 12 months.

The Act is applicable to all the factories.

Meaning of occupier of factory

Occupier of factory means a person who has ultimate control over affairs of factory. It includes a
partner in case of a firm and director in case of a company. It may be noted that if a factory is run
by a company, then only the director of the company can be treated as occupier.

The occupier shall ensure, as far as possible health, safety, and welfare of workers while they are
working in a factory. The name of the occupier of the factory is required to be informed to the
Chief Inspector of Factories. The occupier will be held responsible if the provisions of the
Factories Act, 1948 are not complied with.

Facilities and Conveniences

1) Factory should be kept clean.

2) There should be arrangement to dispose off wastes and effluents.
3) Ventilation should be adequate.
4) Reasonable temperature for comfort of employees should be maintained.
5) Dust and fumes should be controlled below permissible limits.
6) Artificial humidification should be at prescribed limits.
7) Over crowding should be avoided.
8) Adequate lighting, drinking water, toilets, and spittoons should be provided.

Additional facilities in case of large factories.

1) Ambulance room, if 500 or more workers are employed.

2) Canteen, if 250 or more workers are employed.
3) Rest rooms/ Centers with drinking facility, if 150 or more workers are employed.
4) Creshes, if 30 or more women workers are employed.
5) Full time Welfare Officer, if 500 or more workers are employed.
SUJEET JHA 115 9213188188
MS EDUCONZ PVT. LTD. LAW& AUDIT

6) Safety Officer, if 1000 or more workers are employed.

Welfare Measures

1) All machines should be properly fenced to protect workers when machinery is in motion.
2) Hoist and lifts should be in good condition and tested periodically.
3) Pressure Plant should be checked as per the rules.
4) Floor, stairs and means of access should be of sound construction and free from
obstructions.
5) Safety appliances for eyes, dangerous dust, gas, fumes should be provided.
6) In case of hazardous substance additional safety measures have to be taken.
7) Adequate firefighting equipment should be available.
8) Safety Officer should be appointed if number of workers in factory is 1000 or more.

Working Hours

A worker cannot be employed for more than 48 hours in a week. Weekly holiday is compulsory. If
the worker is asked to work on weekly holiday, he should avail the holiday on one of the 3 days
immediately after the normal day of holiday. A worker cannot be employed for more than 9 hours
in a day. At least ½ hour rest should be provided after every 5 hours. Total period of work
including rest interval cannot be more than 10 ½ hours.

Overtime Wages

If a worker works beyond 9 hours a day and 48 hours a week, overtime wages are paid at double
the rate of normal wages. However, overtime wages are not payable on tour. Total working
hours including overtime should not exceed 60 hours in a week and total overtime hours in a
quarter should not exceed 50 hours.

Leave

Worker is entitled in every calendar year annual leave with wages at the rate of 1 day for every
20 days of work performed in the previous calendar year provided that he had worked for 240
days or more in the previous calendar year. Child worker (who is 14 years and above but less
than 15 years) is entitled to 1 day leave with wages for every 15 days. While calculating 240
days earned leave, maternity leave up to 12 weeks and lay off days will be considered but leave
shall not be earned on those days. Leave can be accumulated up to 30 days in the case of an
adult and 40 days in the case of al child.

Leave admissible is exclusive of holidays occurring during or at either end of leave period.
Leave cannot be taken for more than 3 times in a year.

It may be noted that above - mentioned benefit are the minimum benefits. Employer can of
course provide additional or higher benefits.

Employment of Women

A women worker cannot be employed beyond 6 a.m. to 7 p.m. State Government can grant
exemption to any factory from such provisions but in no case a woman can be permitted to work
during 10 p.m. to 5 a.m. Shift change can be done only after weekly or other holiday and not in
between.

SUJEET JHA 116 9213188188

MS EDUCONZ PVT. LTD. LAW& AUDIT

Employment of Children

Children below 14 years of age cannot be employed. A child of age 14 years but below 15 years
can be employed for only 4.5 hours per day. He should be certified fit by certifying surgeon. He
cannot be employed during night from 10 p.m. to 6 a.m.

A person of 15 years of age but below 18 years of age is termed as adolescent. He can be
employed as an adult if he certificate of fitness for a full day’s work from a certifying surgeon.
An adolescent is not permitted to work between 7 p.m. to 6 a.m.

Display on Notice Board.

A Notice containing an abstract of the Factories Act, 1948 and the rules made there under in
English and local language shall be displayed by employer.

The name and address of Inspector of factories and Certifying Surgeon shall also be displayed
on the Notice Board.

Punishment to Welfare Officer

No punishment can be imposed on Welfare Officer without prior sanction of Chief

Commissioner of Factories. However, simple order of termination as per terms of appointment is
not punishment and such termination order is valid. [Arun Kumar Bali v. Government, NCT of
Delhi]

It means any process for—

Manufacturing process [Sec.2 (k)].

(i) Making, altering, repairing, ornamenting, finishing, packing, online, washing , cleaning.
Breaking, up, demolishing, or otherwise treating or adapting any article or substance
with a view to its use, sale, transport, delivery or disposal, or
(ii) Pumping oil, water. Sewage, or any other substance, or
(iii) Generating, transforming or transmitting power, or
(iv) composing types for printing, printing by letter press, lithography, photogravure or other
similar process or book-binding, or
(v) Constructing, reconstructing, repairing, refitting, finishing, breaking-up ship or “vessels,
or
(vi) Preserving or storing any article in cold storage.

Some of the processes which have been held to be manufacturing processes are as follows:
(a) Bidi making [Chintaman Rao v.State of M.P.,(1962) S.C.J.388].
(b) Molding and transformation of raw cinematography films into a finished product
[Gemini Studio v. State, (1952-53) 4 F.J.R. 329].
(c) Work done in a salt work which consists of converting sea-water into salt [Ardeshir H.
Bhiwandiwala v.State of Bombay, A.I.R. (1962) S.C.29.]
(d) Use of a refrigerator for treating or adapting any article with a view to its sale [New Taj
Mahal café Ltd. V. Inspector of Factories, (1956) 1 L.L.J.273].
(e) Work of compositions in printing business [V.K. Press v. Authority, A.I.R. (1955) all.
702].

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(f) Use of electric motor for the purpose of lifting or pumping water [Syed Moosa Kazimi v.
K.M. Sheriff, A.I.R. (1959) Mad. 542].
(g) Process of moistening, stripping and packing of tobacco leaves [V.P. Gopala Rao v.
Public Prosecutor, A.I.R. (1970) S.C. 66].
(h) Activities of a petrol pump [Gateway Auto services v. Regional director, E.S.I. Corpn.,
(1981) Lab. I.C. 49].

In deciding whether a particular business is a manufacturing process or not, regard must be had
to the circumstances of each particular case. To constitute a manufacturing process, there must
be some transformation, i.e., the article must become commercially known as something
different from which it acquires its existence

General duties of the occupier (Sec. 7-A)

A new Sec. 7-A has been introduced by the Amendment Act of 1987, prescribing the general
duties of the occupier in regard to the health, safety and welfare of the workers in his factory.
According to it, every occupier shall ensure, so far as is reasonably practicable, the health, safety
and welfare of all workers while they are at work in the factory [Sec. 7-A (1)]. Sec. 7-A (2)
enumerates the matters in regard to health, safety and welfare of the workers. These matters
include—
(a) the provision and maintenance of plant and systems of work in the factory that are safe
and without risks to health;
(b) the arrangements in the factory for ensuring safety and absence of risks to health in
connection with the use, handling, storage and transport of articles and substances;
(c) the provision of such information, instruction, training and supervision as are necessary
to ensure the health and safety of all workers at work;
(d) (i) the maintenance of all places of work in the factory in a condition that is safe and
without risks to health, and
(II) the provision and maintenance of such means of access to and egress from such
places as are safe and without such risks;
(e) the provision, maintenance or monitoring of such working environment in the factory for
the workers that is
(i) safe,
(ii) without risks to health, and
(iii) adequate as regards facilities and arrangements for their welfare at work [Sec. 7-
A (2)].

In addition to the above duties, every occupier shall also—

(a) prepare, and, as often as may be appropriate, revise, a written statement of his general
policy with respect to
(i) the health and safety of the workers at work, and
(ii) the organisation and arrangements for the time being in force for carrying out that
policy, and
(b) bring the statement and any revision thereof to the notice of all the workers. In some
cases as may be prescribed an occupier may be exempted from this duty [Sec. 7-A (3)].

Powers of inspectors (Sec. 9).

An Inspector may, within the local limits for which he is appointed,--
(a) enter, with assistant who are in the service of the Government or any local or other
public authority or with an expert, the premises of a factory;
(b) make examination of the premises, plant, machinery, article or substance;

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(c) inquire into any accident or dangerous occurrence, whether resulting in bodily injury,
disability or not, and take on the spot or otherwise statements of any person which he
may consider necessary for such inquiry;
(d) require the production of any prescribed register or any other document relating to the
factory;
(e) seize, or take copies of, any register, record or other document or any portion thereof, as
he may consider necessary in respect of any offence under this Act, which he has reason
to believe, has been committed:
(f) direct the occupier that any premises or any part thereof, or anything lying therein, shall
be left undisputed (whether generally or in particular respects) for so long as in necessary
for the purpose of any examination under Clause (b) :
(g) take measurements and photographs and make such recordings as he considers necessary
for the purpose of any examination under Clause (b) taking with him any necessary
instrument or equipment:
(h) in case of any article or substance found in any premised, being an article or substance
which appears to him as having caused or is likely to cause danger to the health or safety
of the workers, direct it to be dismantled or subject it to any process of test (but not so as
to damage or destroy it unless the same is necessary for carrying out the purposes of the
Act.) Further, he may take possession of any such article or substance or a part thereof,
and detain it for so long as is necessary for such examination; and
(i) Exercise such other powers as may be prescribed.

The above powers of an inspector are subject to any rules which may be made by the State
Government in this behalf.

Certifying surgeons (Sec. 10.) Appointment.

¾ The State Government may appoint qualified medical practitioners to be certifying
surgeons for specified local limits or factories [sec. 10 (1)].
¾ A certifying surgeon may, with the approval of the State Government, authorise any
qualified medical practitioner to exercise any of his powers [sec.10. (2)] But no person
shall be appointed a certifying surgeon who is or becomes the occupier of a factory or is
or becomes directly or indirectly interested therein [sec. 10(3)].
¾ The State Government may exempt any person or class of persons from the provisions of
Sec. 10(3) in respect of any factory or class or description of factories (Proviso to Sec
10(3)].
¾ The exemption shall however be made by order in writing and subject to such conditions
as may be specified in the order.
Duties of certifying surgeons.
The certifying surgeon shall carry out such duties as may be prescribed in connection with—
(a) the examination and certification of young person’s ;
(b) the examination of persons engaged in factories in dangerous occupations or processes;
and
(c) the exercising of such medical supervision as may be prescribed for any factory where—
(i) cases of illness have occurred which it is reasonable to believe are due to the nature
of the manufacturing process carried on, or other conditions of work prevailing,
therein;
(ii) by reason of any change in the manufacturing process carried on or in the substances
used therein, there is a likelihood of injury to health of worker employed it that
manufacturing process;
(iii) young persons are, or about to be, employed in any work which I likely to cause
injury to their health [Sec. 10 (4)].
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Cleanliness (Sec.11).
(1) Factory to be kept clean and fee from effluvia and dirt.
¾ Every factory shall be kept clean and fee from effluvia arising from any drain, privy,
or other nuisance.
¾ Accumulation of dirt and refuse shall be removed daily be some effective method.
¾ The floor of every work-room shall be cleaned at least once in every week by
washing, using disinfectants, where necessary, or by some effective method.
(2) Effective means of drainage.
Where a floor is liable to become wet ion the course of any manufacturing process to
such an extent as is capable of being drained, effective means of drainage shall be
provided.
(3) Use of disinfectants, etc., painting and varnishing.
Use of disinfectants, detergents, painting, repainting and varnishing, revarnishing,
whitewashing or colourwashing shall be restored to.
2. Disposal of wastes and effluents (sec.12).
(1) Treatment of wastes and effluents and their disposal.
Effective arrangements shall be made in every factory for the treatment of wastes and
effluents due to the manufacturing process a carried on therein, so as to render them
innocuous, and for their disposal [Sec. 12 (1)].
(2) Rules by the state Government prescribing arrangements.
The state government may make rules prescribing the arrangements to be made in this
regard. It may also require that such arrangements shall be approved by such authority as
may be prescribed [Sec. 12 (2)].

3. Ventilation and temperature (Sec. 13.)

(1) Maintenance of adequate ventilation and temperature.
Effective and suitable provision shall be made in every factory for securing and
maintaining in every workroom—
(a) Adequate ventilation by the circulation of fresh air, and
(b) Such a temperature as will secure to workers therein reasonable conditions of comfort
and prevent injury to health.
(2) Process producing high temperature to be separated.
The walls and roofs shall be of such materials and so designed that the temperature shall
not be exceeded but kept as low as practicable. The process which produces high
temperatures shall be separated from the workroom, by insulating the hot parts or by
other effective means [Sec. 13 (1)].

4. Dust and fume (Sec. 14).

(1) Measures for prevention of inhalation or accumulation of dust and fume.
¾ Where dust or fume or impurity of such a nature as is likely to be injurious or
offensive to the workers is given off as a result of the manufacturing process being
carried on in a factory, effective measures shall be taken in the factory for prevention
of inhalation or accumulation of dust and fumes in workrooms.
¾ If for such a purpose any exhaust appliance is necessary, it shall be applied as near as
possible to the point of origin of the dust, fume or other impurity and such point shall
be enclosed so far as possible [Sec. 14 (1)].

(2) Exhaust for internal combustion engine.

A stationary internal combustion engine shall not be operated unless the exhaust is
conducted into the open air. Other internal combustion engines shall not be operated in
any room unless effective measures have been taken to prevent accumulation of fumes
therefrom which are injurious [Sec. 14 (2)].
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5. Artificial humidification (Sec. 15).

(1) Prescription of standards of humidification—ventilation and cooling of air.
In respect of all factories in which the humidity of the air is artificially increased, the
State Government may make rules prescribing standards of humidification. It may also
make rules regulating the methods used for artificially increasing the humidity of the air.
It may further make rules prescribing methods to be adopted for securing adequate
ventilation and cooling of the air in the workrooms [Sec. 15 (1)].
(2) Water used for artificial humidification to be clean.
In any factory in which the humidity of the air is artificially increased, the water used for
the purpose shall be taken from a public supply or other source of drinking water, or
shall be effectively purified before it is so used [Sec. 15 (2)].
6. Overcrowding (Sec. 16).
(1) Overcrowding injurious to health of workers to be avoided.
There shall not be overcrowding in any room of the factory so as to be injurious to the
health of the workers employed therein [Sec. 16 (1)].

(2) 9.9/14.2 cubic meters of space per worker.

¾ There shall be at least 9.9 cubic meters (for the factories in existence at the time of the
commencement of the Act) and 14.2 cubic meters (for the factories built after the
commencement of the Act) of space for every worker.
¾ In calculating the space of 9.9 or 14.2 cubic meters, no account shall be taken of any space
which is more than 4.2 meters above the level of the floor of the room [Sec. 16 (2)].

(3) Notice of maximum of workers to be employed in a workroom.

If the Chief Inspector by order in writing so requires, there shall be posted in each
workroom of the factory a notice specifying the maximum number of workers who may
be employed in the workroom [Sec. 16 (3)].

7. Lighting (Sec. 17).

(1) Sufficient and suitable lighting in every part of factory.
In every part of a factory where workers are working or passing there shall be provided
and maintained sufficient and suitable lighting, natural or artificial, or both [Sec. 17 (1)].

(2) Glazed windows and skylights to be kept clean.

All glazed windows and skylights used for the lighting of the workrooms shall be kept
clean on both the inner and outer surfaces and free from obstruction [Sec. 17 (2)].

(3) Measures for prevention of glare and formation of shadows.

Effective provision shall also be made for the prevention of (a) glare, either directly from a
source of light or by reflection from a smooth or polished surface; and (b) the
formation of shadows to such an extent as to cause eye strain or the risk of accident to
any worker [Sec. 17 (3)].

(4) Prescription of standards of sufficient and suitable lighting.

The State Government may prescribe standards of sufficient and suitable lighting for
factories or for any class or description of factories or for any manufacturing process
[Sec. 17 (4)].

8. Drinking water (Sec. 18).

(1) Suitable points for wholesome drinking water.

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In every factory, effective arrangements shall be made to provide and maintain at

suitable points conveniently situated for all workers employed therein a sufficient supply
of wholesome drinking water [sec. 18 (1)].
(2) Cooling of drinking water where more than 250 workers employed.
In every factory wherein more than 250 workers are ordinarily employed, provision shall
be made for cooling drinking water during hot weather by effective means and for
distribution thereof [Sec. 18(3)].

9. Hoists and lifts (Sec. 28).

¾ Hoists and lifts to be of good mechanical construction and to be properly maintained
and examined once in every 6 months. In every factory every hoists and lift shall be of
good mechanical construction, sound material, and adequate strength.
¾ Further it shall be sufficiently protected by enclosures fitted with gates. It shall also be
properly maintained and shall be thoroughly examined by a competent person at least
once in every 6 months.
¾ A register containing the prescribed particulars of every such examination shall be kept.
The maximum safe working load shall also be plainly marked on every hoist or lift, and
no load greater than such load shall be carried thereon.
¾ The cage of every hoist or lift used for carrying persons shall be fitted with a gate on
each side from which access is afforded to a landing.
¾ The gate shall be fitted with interlocking or other efficient device to secure that the cage
cannot be moved unless the gate is closed.

For the purposes of Sec. 28, no lifting machine or appliance shall be deemed to be a hoist
or lift unless it has a platform or cage, the direction or movement of which is restricted
by a guide or guides (Expl. to Sec. 28 added by the Amendment Act of 1987).

12. Floors, stairs and means of access (Sec. 32). In every factory—
(a) all floors, steps, stairs, passages and gangways shall be of sound construction and
properly maintained. Further they shall be kept free from obstructions and substances
likely to cause persons to skip and handrails shall be provided where necessary;
(b) there shall, so far as is reasonably practicable, be provided and maintained safe means of
access to every place at which any person is at any time required to work; and
(c) when any person has to work at a height from where he is likely to fall, provision shall
be made, so far as is reasonably practicable, by fencing or otherwise, to ensure the safety
of the person so working. This restriction is not applicable if the place provides secure
foothold and, where necessary, secure handhold.

13. Safety Officers (Sec. 40-B). In every factory

(i) wherein 1,000 or more workers are ordinarily employed, or
(ii) wherein, in the opinion of the State Government, any manufacturing process or operation
is carried on, which process or operation involves any risk of bodily injury, poisoning or
disease, or any other hazard to health, to the persons employed in the factory, the
occupier shall, if so required by the State Government by notification in the Official
Gazette, employ such number of Safety Officers as may be specified in that notification
[Sec. 40-B) (1)]. The duties, qualifications and conditions of service of Safety Offices
shall be such as may be prescribed by the State Government [Sec. 40-B (2)].

WELFARE
Chapter V (Secs. 42 to 50) of the Act deals with facilities for the welfare of workers. The
various provisions in this regard are as follows:
1. Washing facilities (Sec. 42). In every factory (a) adequate and suitable facilities
(separately and adequately screened for the use of male and female workers ) shall be
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provided and maintained for the use of the workers therein; and (b) such facilities shall
be conveniently accessibly and shall be kept clean.
2. Facilities for storing and drying clothing (Sec. 43). The State Government may make
rules requiring the provision of suitable places for keeping clothing of workers not worn
during working hours and for the drying of wet clothing in respect of any factory or class
of factories.
3. Facilities for sitting (Sec. 44).
(1) Provision of sitting arrangement for workers obliged to work in a standing
position. In every factory, suitable arrangements for sitting shall be provided and
maintained for all workers who are obliged to work in a standing position. This has
been done in order that the workers may take advantage of any opportunities for rest
which may occur in the course of their work [Sec. 44 (1)].
(2) Provision of seating arrangement for workers doing work which can be done in a
sitting position. If the workers in any factory engaged in a particular manufacturing
process or working in a particular room are able to do their work efficiently in a
sitting position, the Chief Inspector may require the occupier of the factory to
provide such seating arrangements as may be practicable [Sec. 44 (20].
(3) Exemption. The State Government may, by notification in the Official Gazette,
exempt any factory or class of factories or manufacturing process from the
application of the provisions of Sec. 44 [Sec. 44 (3)].

4. First-aid appliances (Sec. 45).

(1) At least one first-aid box with prescribed contents for every 150 workers.
There shall in every factory be provided and maintained so as to be readily accessible
during all working hours, first-aid boxes or cupboards with the prescribed contents.
There shall be at least one such box for every 150 workers ordinarily employed at any
one time in the factory [Sec. 45 (1)].

(2) First-aid box to have prescribed contents.

Only the prescribed contents shall be kept in a first-aid box or cupboard [Sec. 45 (2)].

(3) First-aid box to be in the charge of responsible person.

Each first-aid box or cupboard shall be kept in the charge of a separate responsible
person who holds a certificate in the first-aid treatment recognized by the State
Government. Further, such person shall always be readily available during the working
hours of the factory [Sec. 45 (3)].

(4) Ambulance room in a factory employing more than 500 workers.

In every factory wherein more than 500 workers are ordinarily employed there shall be
provided and maintained an ambulance room containing the prescribed equipment.
The room shall be in the charge of such medical and nursing staff as may be prescribed
and those facilities shall always be made readily available during the working hours of
the factory [Sec. 45 (4)].

5. Canteens (Sec. 46)

(1) Canteen in factory employing more than 250 workers—the State Government may
make rules.
The State Government may make rules requiring that in any specified factory wherein
more than 250 workers are ordinarily employed, a canteen or canteens shall be provided
and maintained by the occupier for the use of the workers [Sec. 46 (1)].

(2) Provisions in rules.

The rules made by the State Government as to canteens may provide for
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(a) The date by which canteen shall be provided,

(b) The standards in respect of construction, accommodation, furniture and other
equipment of the canteen,
(c) The foodstuffs to be served therein and the charges which may be made thereof,
(d) The constitution of a managing committee for the canteen and representation of the
workers in the management of the canteen,
(e) The items of expenditure in the running of the canteen which are not to be taken into
account in fixing the cost of foodstuffs and which shall be borne by the employer,
and
(f) The delegation to the Chief Inspector, subject to such conditions as may be
prescribed, of the power to make rules under Clause (c) [Sec. 46 (2)].

6. Shelters, rest rooms and lunch rooms (Sec. 47).

(1) Provision for shelters, rest rooms, lunch rooms in factories employing more than 150
workers.
¾ In every factory wherein more than150 workers are ordinarily employed, there shall
be a provision for shelters, rest rooms and a suitable lunch room where workers can
eat meals brought by them with provision for drinking water.
¾ However, any canteen maintained in accordance with the provisions of Sec. 46 shall
be regarded as part of this requirement. Where a lunch room exists, no worker shall
eat any food in the workroom [Sec. 47 (1)].

(2) Shelters, etc. to be sufficiently lighted, ventilated and cooled.

The shelters or rest rooms or lunch rooms shall be sufficiently lighted and ventilated and
shall be maintained in a cool and clean condition [Sec. 47 (2)].

7. Crèches (Sec. 48).

(1) Provision of crèches in factories employing more than 30 women workers.
In every factory wherein more than 30 women workers are ordinarily employed, there
shall be provided and maintained a suitable room or rooms for use of children under the
age of 6 years of such women [Sec. 48 (1)].

(2) Crèches to be adequately lighted and ventilated and to be under the charge of trained
women.
Rooms for use of children shall provide adequate accommodation, shall be adequately
lighted and ventilated. Further they shall be maintained in a clean and sanitary condition
and shall be under the charge of women trained in the care of children and infants [Sec.
48 (2)].

(3) Prescription of rules by the State Government.

The State Government may make rules prescribing the location and the standards in
respect of construction, accommodation, furniture and other equipment of rooms for use
of children. It may also make rules for the provision of additional facilities for the care of
children belonging to women workers, including suitable provision of facilities
(a) For washing and changing their clothing,
(b) Of free milk or refreshment or both for the children, and
(c) For the mothers of children to feed them at the necessary intervals. [Sec. 48 (3)].
8. Welfare officers (Sec. 49).
(1) Employment of welfare officers in factories employing 500 or more workers.
In every factory wherein 500 or more workers are ordinarily employed the occupier shall
employ in the factory such number of welfare officers as may be prescribed [Sec. 49 (1)].

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(2) Duties, qualifications and conditions of service to be prescribed by the State

Government.
The State Government may prescribe the duties, qualifications and conditions of service
of welfare officers [Sec. 49 (2)].
Even if a factory (say, a sugar factory) employs over 500 workers only for a few
months in the year and not continuously, the occupier shall employ the prescribed
number of welfare officers [Employers’ Assn. of Northern India v. Secretary of Labour,
A.I.R. (1952) All. 109].

Restriction on double employment (sec. 60)

No adult worker shall be required or allowed to work in any factory on any day on which he has
already been working in any other factory save in such circumstances as may be prescribed.

Working hours and notice of periods of work for children (Secs. 71 and 72).
(1) Working hours limited to 4-1/2.
No child shall be employed or permitted to work in any factory—
(a) for more than 4-1/2 hours in any day;
(b) during the night [Sec. 71 (1)].

‘Night’ means a period of at least 12 consecutive hours which shall include the4 interval
between 10 P.M. and A.M. [Expl. to Sec. 71 (1)].

(2) Period of work of children limited to 2 shifts.

The period of work of all children employed in a factory shall be limited to 2 shifts. These
shifts shall not overlap or spread over more than 5 hours each. Each child shall be employed
in only one of the relays which shall not, except with the previous permission in writing of
the Chief Inspector, be changed more frequently than once in a period of 30 days [Sec. 71
(2)].

(3) Child workers entitled to weekly holidays.

The provisions of weekly holidays |(Sec. 52) shall apply also to child workers and no
exemption from these provisions may be granted in respect of any child [Sec. 71 (3)].

(4) Prohibition if the child worker has already been working in another factory.
No child shall be required or allowed to work in any factory on any day on which he has
already been working in another factory [Sec. 71 (4)].

(5) Female child to work only between 8 A.M. to 7 P.M.

No female child shall be required or allowed to work in any factory except between 8 A.M.
and 7 P.M. [Sec. 71 (5) as introduced by the Amendment Act of 1987].

(6) Display of notice of work of child-workers.

There shall be displayed and correctly maintained in every factory in which children are
employed a notice of periods of work for children showing clearly for every day the periods
during which children may be required or allowed to work [Sec. 72 (1)]. The provisions of
Sec. 61(8), (9) and (10) (discussed earlier) also apply to the notice required under Sec. 72 (1)
[Sec. 72 (3)].

(7) Fixation of periods of work beforehand.

The periods shown in the notice shall be fixed beforehand in accordance with the method
laid down for adult workers [Sec. 72 (2)].

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5. Restriction on employment of women (Se3c. 66).

A woman shall be required or allowed to work in a factory only between the hours of 6 A.M. and
7 P.M. The State Government may, by notification in the Official Gazette in respect of any
factory or group or class or description of factories, vary these limits. But no such variation shall
authorise the employment of any woman between the hours of 10 P.M. and 5 P.M. Again there
shall be no change of shifts in the case of women workers in a factory except after a weekly or
any other holiday [Sec. 66 (1)].

The State Government may make rules providing for the exemption from the restrictions
imposed by Sec. 66 (1) in case of women working in fish-curing or fish-canning factories, where
the employment of women beyond the specified hours is necessary to prevent damage to, or
deterioration in, any raw material [Sec. 66 (3)].

Wages during leave period (Sec. 80).

For the leave allowed to a worker he shall be entitled to wages at a rate equal to the daily
average of his total full time earnings for the days on which he actually worked during the
month immediately preceding his leave. The full time earnings shall be exclusive of any
overtime and bonus but inclusive of dearness allowance and the cash equivalent of the advantage
accruing through the concessional sale to the worker of foodgrains and other articles [Sec. 80
(1)].

Important Points
1) The Supreme Court held that salt manufacture from sea water by employing different
processes is a manufacturing process and the workers engaged in this work are workers
within the meaning of Factories Act. [Ardeshir H. Bhiwandiwala v. State of Bombay]

2) The Supreme Court held that sun cured tobacco leaves subjected to processes of
moistening, stripping, breaking up, packing with the view to transport them to
Company’s main Factory for their use in manufacturing Cigarette is a manufacturing
process under the Factories Act. [Ardehir H. Bhiwandiwala v. State of Bombay]

3. The cutting of the woods or converting the wood into planks is a part of the
manufacturing activity. [Bharati Udyog v. Regional Director ESI Corpn.]

4) Construction of railway, use of materials like sleepers, bolts, loose rails etc, to adaptation
their use for ultimately for laying down railways line amounts to manufacturing process.
[Lal Mohmd. v. Indian Railway Construction Co. Ltd.]

5) The process undertaken in zonal and sub -stations and electricity generating stations,
transforming and transmitting electricity generated at the power station does not fall
within the definitions of manufacturing process. [Workmen of Delhi Electric Supply
Undertaking v. Management of DESU]

6) Piece - rate workers can be workers within the definition of worker in the Act, but they
must be regular workers and not workers who come and work according to their will,
[Shankar Balaji Wale v. State of Maharashtra]

7) All persons employed in or in connection with a factory whether or not employed as

workers are entitled to the benefits of the Act. [Union of India v. G.M. Kokil]

8) If a factory is being run by a Company, then only a director of that Company can be the
occupier for the purpose of the Act.[ J.K. Industries Ltd. v. Chief Inspector of Factories]

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9. Employees working in canteens in industrial establishment runs by Managing Committee

are not employers of the Managing Committee, but are employees of occupier. [Kanpur
Suraksha karamchari Union v. Union of India]

10) Preparation of food and beverage and its sale to members of a club is a manufacturing
process. [CCI v. ESIC]

11. Receiving products in bulk and packing as per clients requirements amounts to
manufacture.

12. A person is said to be employed in the factory if his duties are connected with the
business of the factory, no matter whether he stands outside the factory premises or
inside it. [Shinde v. Bombay Telephones]

13. It was held the definition of worker includes employees who are entrusted solely with the
clerical duties. [Works Manager, Central Rly. Workshop Jhansi v. Vishwanath and
others]

Powers of Inspectors

An inspector may exercise any of the following powers within the local limits for which he is
appointed:
1. He can enter any place which is used or which, he has reasons to believe, is used as
factory.
2. He can make examination of the premises, plant, machinery etc.
3. He can require the production of any prescribed register or any other document relating
to the factory.
4. Take measurement and photographs and make such recordings as the considers
necessary for the purpose of any examination.

Processes Special Provisions relating to Hazardous

Special provisions relating to hazardous processes have been envisaged under Chapter IV. A of
the Factories Act, 1948. This chapter was inserted by the Factories (Amendment) Act, 1987 and
Consists of Sections 41 A to 41 H. These sections are as follows:

Constitution of Site Appraisal Committees [Section 41A ]: A Committee under the name Site
Appraisal Committee shall be constituted by the State Government to advise the Government in
the matter of examination of application for establishment of factories involving hazardous
processes. The constitution of the site appraisal committee consisting of committee has been
specified therein.

The Site Appraisal Committee shall examine an application for the establishment of a factory
involving hazardous process and make its recommendation to the State Government within a
period of ninety days in the prescribed from.

Compulsory disclosure of information by the occupier [Section 41B]: It is compulsory on the

part of the occupier of every factory involving a hazardous process to disclose all information
regarding dangers, including health hazards to the workers employed in the factory, the Chief
Inspector, the local authority within whose jurisdiction the factory is situated and the general
public in the vicinity.

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Specified responsibility of the occupier in relation to hazardous processes

[Section 41C]:
Accurate and up to date health records or medical records of the
workers of the factory who are exposed to any chemical toxic or any
other harmful substances which are manufactured, stored, handled or
transported and such records shall be maintained by the occupier
of a factory involving any hazardous process.

Inquiry Committee [Section 41D]: In the event of occurrence of an

extraordinary situation, the
Central Government may appoint an Inquiry Committee to inquire
into the standards of health
and safety observed in the factory with a view to finding out the causes
of any failure or neglect
in the adoption of any measures prescribed for the health and safety
of the workers or the
general public.

Emergency standards [Section 41E]: The director - General of Factory

Advice Service and Labour Institutes may be directed by the Central
Government to lay down emergency standards in respect of hazardous
process.

Permissible limits of exposure of chemical and toxic substances

(Section 41F): The second Schedule added to the Act, indicates
maximum permissible threshold limits of exposure of chemical and
toxic substances in manufacturing processes in any factory.

Workers Participation in safety management (Section 41G): The

occupier in every factory shall set up a safety committee consisting of
equal number of representatives of workers and management to
promote co - operating between the workers and the
management in maintaining proper safety and health at work and to
review periodically the measure taken in that behalf where hazardous
process is involved.

Warning about imminent danger (Section 41H): If there is reasonable

apprehension regarding likelihood of imminent danger to the lives or
health of the workers employed in a factory, they may bring the same
to the notice of the occupier, agent, manager, etc.