It Is High Time To Act

                                                                     Existing  Method of Payment of Wages of Employees
The government of India amended Section 6 of the Payment of Wages,1936, a major Indian labour law on 28-12-2016 to the effect that payment of wages of employees shall be made either in currency notes or by cheque or by credit in their bank accounts. The amended law empowers the State governments to notify selective industry/industries in which the employers shall pay the wages of their employees by cheque or credit in their bank account. The Karnataka State government has not specified any industry so far in pursuance of the amended law.
The amended law goes against the twin policies of the government of India in regard to the paperless money transactions among citizens and between the citizen and the bank or other financial institution and mandatory opening of bank accounts by all Indian citizens.
The  Central/State government should not have been empowered to specify any industry under the amended law. The present statutory position may involve undue delay in the issuance of the notification of the specific industries.
The amended law should have made the payment of the employees’ wages by their employers mandatorily ONLY in their bank accounts in pursuance of the Indian government’s twin policies of paperless money transaction of Indians and the compulsory opening of the bank account by Indians. Properly, the amended law should not have empowered the government, at least without any time limit, to notify specific industries in which employees’ wages shall be paid by cheque or in their bank accounts. Discretion in the exercise of power usually results in a delay in exercise of power or no exercise of that power. The amended law is an eye-wash and has no teeth.

Required New Amendment

The defective amended law needs to be amended again by substituting the existing amendment by the following suggested amendment to Section 6 of the Act:
‘Section 6. All wages shall be paid by credit in the bank account of the employee.’
This new amendment will serve the desired purpose and also resolve the conflict between the existing Section 6 and the above twin policies of the Indian government.
It is high time that the trade unions, labour leaders, intellectuals, knowledgeable employees and news media bestir themselves to the gravity of the issue and initiate a movement for the desired fresh amendment of Section 6 of the Payment of Wages Act,1936.

Will they rise to the occasion?

How the Largest Informal(unorganized) Workforce In India Can Get Justice

                                                    Digital  India   Programme 

  The government of India has implemented two popular programmes  for Indian citizens:

1) cashless and paperless economy or digital money transactions by the citizens.’ Digital India programme is a flagship programme of the government of India’  and

2) opening of zero balance savings accounts in the bank by every more than 10 years old citizen, literate or illiterate.

Digital money transactions by the citizens are grouped under ten categories:

1) credit card/debit card/cash card, etc.,

2) USSD,

3) UPI,

4) mobile wallet,

5) banks prepaid card,

6) points of sale,

7) internet banking,

8} mobile banking and

9) micro ATMs and

10) AEPs.

(For details of these two major programmes,visit:cashlessindia.gov.in and pmjdy.gov.in)

                        Payment of workers’ wages into their bank accounts

In pursuance of the first scheme, employers of unorganized or informal workers are mandatorily to be made to pay their employees’ wages by credit in their bank accounts by amending Section 6 of the Payment of Wages Act,1936.

In pursuance of the second scheme, all unorganized employees can and will open their zero balance savings accounts in banks, as the scheme is for their benefit.

The unorganized workforce is the largest in India, that is, about 93 percent of the nearly 500 million workforce(Deccan Herald dated 14-10-2017).

Once the employees’ wages are mandatorily paid by crediting in their bank accounts, the law enforcing inspector will check the employees’ wage register with their bank passbooks/account statements. If he finds in the employee’s  bank passbook/account statement  payment of less wages   than the legal wages or non-payment of the wages, he has the perfect and unchallengeable documentary proof of the offence(in the form of employee’s bank passbook/account statement) committed by the employer and can prove the offence easily in the criminal court. The oral corroborative evidence of the elusive and uncooperative witnesses is not required for proving the employer’s offence.

The suggested amended payment of wages law will enable the inspector effectively to enforce the wage payment law and to do full justice to the largest section of the workforce in India, the unorganized or informal employees.

Payment of Employees’ Wages Into Their Bank Accounts Will End Violation and Malpractice

The unorganized and ununionized employees, the largest workforce in India are not paid their wages(salary or pay ) into their bank accounts by their employers.These employees work in private small factories, shops and commercial establishments

The labour law applicable to these private factories like rice mills, flour mills, fabrication units, shops like groceries, stationeries, bookshops and commercial establishments like hotels, lodges, laboratories is the Payment of Wages Act,1936.

The method of payment of the employees’ wages prescribed by this law is in currency notes or by cheque or credit into their bank accounts.Now payment of the wage into employees’ bank accounts is NOT compulsory and statutorily binding on the employers.Here the employers never comply with the request of the employees to get their wages paid into their bank accounts and force their employees to accept payment of their wages in currency notes.Cash payment of the wages leads to payment of less than the legal wages. This results in glaringly exploitative malpractice stubbornly followed by employers for decades for the main reason that the employees are either illiterate, semiliterate, ignorant of their wage rates rights or simply afraid to demand their legal wages from their employers.Their fear is that their employment may be terminated immediately, though illegally and they may face the dreaded unemployment.

This widespread and chronic malpractice has resulted in extreme injustice and unfairness to the employees.It is stressed that it enables employers to pay less than the minimum wages fixed by the Government or wages mutually accepted orally by the employee and the employer, though their wages payment record shows correct but UNTRUE figures of minimum wages or mutually accepted wages.

When the labour law enforcement officer inspects the factory or shop or commercial establishment, the workers, in most cases, do not come forward to give true information of their actually received wages or refuse to sign their statement about their wages. In some rare cases, they reveal the payment of less than the minimum wages or mutually accepted wages.In very rare cases, there will be tally between the wage figures in the wage register and actual wage payment figures.The law enforcement authority is helpless in such an unfortunate situation of non-cooperation from the employees and cannot offer effective and efficient service to the employees.

The pressing legal solution to the legal deficiency is, therefore, an amendment of Section 6 of the Payment of  Wages Act,1936 to the effect that the employees’ wages should be compulsorily paid ONLY into their bank accounts.This amended law will finally end the long-established, extremely exploitative and unjust practice indulged in by employers for decades.

The Indian Government has enacted an amendment to the Payment of Wages Act,1936 on 16-2-2017( vide: labour.gov.in/wages) for the adoption of any one of the three options of wage payment by the employers: in currency notes or by cheque or credit into employee’s bank account.

Payment of Wages of Workers Into Their Bank Account

The amendment does not uproot the malpractice.It needs to be re-amended and made applicable to all organized and unorganized employees working in factories, shops, and commercial establishments and statutorily binding on the employers COMPULSORILY to pay their employees’ wages ONLY into their bank accounts.Paperless payment of the employees’ wages into their bank accounts will also be in compliance with the two recent major government policies of paperless money transactions of the citizens and the opening of a free bank account by every citizen of the country.The suggested crucial amendment to the Payment of Wages Act,1936 will end the violation of the law and the malpractice.