Centre approved wage payment by cheques via ordinance:
The Centre approved the promulgation of an ordinance to enable industries to pay wages by cheque or by direct credit into bank accounts of workers earning up to Rs. 18,000 a month, without taking their explicit consent as required under the present 1936 law.
Union Minister of State for Labour and Employment said wage payment through the banking system would only be optional, until State governments or the Centre come up with a notification for specific industries.
Rationale behind the ordinance:
The move assumes significance in the context of the government’s efforts to promote cashless transactions after its decision to scrap the old Rs. 500 and Rs. 1,000 currency notes.
Mr. Dattatreya had introduced the Payment of Wages (Amendment) Bill, 2016 in the Lok Sabha on December 15, but it couldn’t be cleared owing to the impasse in Parliament. An ordinance has been passed, which will need the President’s assent to become law that proposes changes to Section 6 of the Payment of Wages Act of 1936.
The present law states that all payment of wages should be in cash, with a provision asking employers to obtain written permission of the worker to pay either by cheque, or by crediting the wages to his or her bank account.
The haste in ensuring payment of salaries through banks through an ordinance is unjustified, particularly when the entire banking service is in disorder.
It sought to take away the worker’s right to take wages in their preferred mode i.e cash.