15. Mode of payment of wages.—All wages shall be paid in current coin or currency notes or by
cheque or by crediting the wages in the bank account of the employee or by the electronic mode:
Provided that the appropriate Government may, by notification, specify the industrial or other
establishment, the employer of which shall pay to every person employed in such industrial or other
establishment, the wages only by cheque or by crediting the wages in his bank account.
16. Fixation of wage period.—The employer shall fix the wage period for employees either as daily
or weekly or fortnightly or monthly subject to the condition that no wage period in respect of any
employee shall be more than a month:
Provided that different wage periods may be fixed for different establishments.
17. Time limit for payment of wages.—(1) The employer shall pay or cause to be paid wages to the
employees, engaged on—
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(i) daily basis, at the end of the shift;
(ii) weekly basis, on the last working day of the week, that is to say, before the weekly holiday;
(iii) fortnightly basis, before the end of the second day after the end of the fortnight;
(iv) monthly basis, before the expiry of the seventh day of the succeeding month.
(2) Where an employee has been—
(i) removed or dismissed from service; or
(ii) retrenched or has resigned from service, or became unemployed due to closure of the
establishment,
the wages payable to him shall be paid within two working days of his removal, dismissal, retrenchment
or, as the case may be, his resignation.
(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), the appropriate
Government may, provide any other time limit for payment of wages where it considers reasonable
having regard to the circumstances under which the wages are to be paid.
(4) Nothing contained in sub-section (1) or sub-section (2) shall affect any time limit for payment of
wages provided in any other law for the time being in force.
18. Deductions which may be made from wages.—(1) Notwithstanding anything contained in any
other law for the time being in force, there shall be no deductions from the wages of the employee, except
those as are authorised under this Code.
Explanation.— For the purposes of this sub-section, —
(a) any payment made by an employee to the employer or his agent shall be deemed to be a
deduction from his wages;
(b) any loss of wages to an employee, for a good and sufficient cause, resulting from—
(i) the withholding of increment or promotion, including the stoppage of an increment; or
(ii) the reduction to a lower post or time-scale; or
(iii) the suspension, shall not be deemed to be a deduction from wages in a case where the
provisions made by the employer for such purposes are satisfying the requirements specified in
the notification issued by the appropriate Government in this behalf.
(2) Deductions from the wages of an employee shall be made in accordance with the provisions of
this Code, and may be made only for the following purposes, namely:—
(a) fines imposed on him;
(b) deductions for his absence from duty;
(c) deductions for damage to or loss of goods expressly entrusted to the employee 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 appropriate Government
or any housing board set up under any law for the time being in force, whether the Government or
such 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 the appropriate Government by
notification;
(e) deductions for such amenities and services supplied by the employer as the appropriate
Government or any officer specified by it in this behalf may, by general or special order, authorise
and such deduction shall not exceed an amount equivalent to the value of such amenities and services.
Explanation.—For the purposes of this clause, the expression “services” does not include the
supply of tools and raw materials required for the purposes of employment;
(f) deductions for recovery of—
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(i) 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;
(ii) loans made from any fund constituted for the welfare of labour, as may be prescribed by
the appropriate Government, and the interest due in respect thereof;
(g) deductions for recovery of loans granted for house-building or other purposes approved by the
appropriate Government and the interest due in respect thereof;
(h) deductions of income-tax or any other statutory levy levied by the Central Government or
State Government and payable by the employee or deductions required to be made by order of a court
or other authority competent to make such order;
(i) deductions for subscription to, and for repayment of advances from any social security fund or
scheme constituted by law including provident fund or pension fund or health insurance scheme or
fund known by any other name;
(j) deductions for payment of co-operative society subject to such conditions as the appropriate
Government may impose;
(k) deductions made, with the written authorisation of the employee, for payment of the fees and
contribution payable by him for the membership of any Trade Union registered under the Trade
Unions Act, 1926 (16 of 1926);
(l) deductions for recovery of losses sustained by the railway administration on account of
acceptance by the employee of counterfeit or base coins or mutilated or forged currency notes;
(m) deductions for recovery of losses sustained by the railway administration on account of the
failure of the employee to invoice, to bill, to collect or to account for the appropriate charges due to
the railway administration whether in respect of fares, freight, demurrage, wharf age and cranage or
in respect of sale of food in catering establishments or in respect of commodities in grain shops or
otherwise;
(n) deductions for recovery of losses sustained by the railway administration on account of any
rebates or refunds incorrectly granted by the employee where such loss is directly attributable to his
neglect or default;
(o) deductions, made with the written authorisation of the employee, for contribution to the Prime
Minister's National Relief Fund or to such other fund as the Central Government may, by notification,
specify.
(3) Notwithstanding anything contained in this Code and subject to the provisions of any other law
for the time being in force, the total amount of deductions which may be made under sub-section (2) in
any wage period from the wages of an employee shall not exceed fifty per cent. of such wages.
(4) Where the total deductions authorised under sub-section (2) exceed fifty per cent. of the wages,
the excess may be recovered in such manner, as may be prescribed.
(5) Where any deduction is made by the employer from the wages of an employee under this section
but not deposited in the account of the trust or Government fund or any other account, as required under
the provisions of the law for the time being in force, such employee shall not be held responsible for such
default of the employer.
19. Fines.—(1) No fine shall be imposed on any employee save in respect of those acts and omissions
on his part as the employer, with the previous approval of the appropriate Government or of such
authority as may be prescribed, may have specified by notice under sub-section (2).
(2) A notice specifying such acts and omissions shall be exhibited in such manner as may be
prescribed, on the premises in which the employment is carried on.
(3) No fine shall be imposed on any employee until such employee 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.
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(4) The total amount of fine which may be imposed in any one wage-period on any employee shall
not exceed an amount equal to three per cent. of the wages payable to him in respect of that wage-period.
(5) No fine shall be imposed on any employee who is under the age of fifteen years.
(6) No fine imposed on any employee shall be recovered from him by installments or after the expiry
of 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 in such manner and
form as may be prescribed; and all such realisations shall be applied only to such purposes beneficial to
the persons employed in the establishment as are approved by the prescribed authority.
20. Deductions for absence from duty.—(1) Deductions may be made under clause (b) of subsection (2) of section 18 only on account of the absence of an employee 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 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 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 amount not exceeding his wages for eight
days as may by any such terms be due to the employer in lieu of due notice.
Explanation.— For the purposes of this section, an employee 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.
21. Deductions for damage or loss.—(1) A deduction under clause (c) or clause (n) of sub-section
(2) of section 18 for damage or loss shall not exceed the amount of the damage or loss caused to the
employer by negligence or default of the employee.
(2) A deduction shall not be made under sub-section (1) until the employee 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.
(3) All such deductions and all realisations thereof shall be recorded in a register to be kept in such
form as may be prescribed.
22. Deductions for services rendered.—A deduction under clause (d) or clause (e) of sub-section (2)
of section 18 shall not be made from the wages of an employee, 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
shall be subject to such conditions as the appropriate Government may impose.
23. Deductions for recovery of advances.—Deductions under clause (f) of sub-section (2) of section
18 for recovery of advances given to an employee shall be subject to the following conditions, namely:—
(a) recovery of advance of money given to an employee before the employment began shall be
made from the first payment of wages to him in respect of a complete wage-period but no recovery
shall be made of such advances given for travelling expenses;
(b) recovery of advance of money given to an employee after the employment began shall be
subject to such conditions as may be prescribed;
(c) recovery of advances of wages to an employee not already earned shall be subject to such
conditions as may be prescribed.
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24. Deductions for recovery of loans.—Deductions under clause (g) of sub-section (2) of section 18
for recovery of loans granted to an employee, regulating the extent to which such loans may be granted
and the rate of interest payable thereon, shall be such as may be prescribed.
25. Chapter not to apply to Government establishments.—The provisions of this Chapter shall not
apply to the Government establishments unless the appropriate Government, by notification, applies such
provisions to the Government establishments specified in the said notification.