Wage

Showing posts with label Wage. Show all posts
Showing posts with label Wage. Show all posts

Tuesday 21 August 2012

Workmen Compensation Act



Workmen’s Compensation Act, 1923

This provides for compensation to workmen or their survivors in cases of industrial accidents and occupational diseases, resulting in disablement or death. The Act was recently amended and renamed as Employee Compensation Act, 1923. It covers persons employed in factories, mines, plantations, mechanically propelled vehicles, construction works and certain other hazardous occupations listed out in schedule II of the Act.

In addition, schedule III contains a list of diseases and persons in occupations where infection is possible. Qualifying persons are eligible to claim compensation under this Act. This law applies to the unorganized sectors and to those in the organized sectors who are not covered by the Employees State Insurance Scheme. The Act is administered by the State Governments through Commissioners for Workmen’s Compensation. The Commissioner is required to dispose of the matter relating to compensation within 3 months of reference.

Minimum Compensation in case of death is Rs. 120,000 and in the case of permanent total disablement is Rs. 140,000. The monthly wage ceiling is at present Rs.8, 000. Maximum compensation can go up to 50% of the monthly wage multiplied by relevant age factor as specified in the act.

Compensation should be paid early. Delay beyond 1 month will attract interest and penalty of up to 50% of the compensation. Certain other offenses attract fine of up to Rs. 5,000.In cases where the employer does not accept the liability for compensation to the extent claimed, he shall be bound to make provisional payment based on the extent of liability which he accepts.

Employer is not liable in case the disablement of workman is three or less days, except in case of death when the injury is caused due to influence of drink or drug taken by the workman or upon his willful disobedience to obey safety rules or removal of safety guards by him.

Maternity Benefit Act, 1961

The Maternity Benefit Act, 1961 (MBA) regulates the employment of women in certain establishments for a prescribed period before and after childbirth and provides certain other benefits, including leave, to a woman who has undergone miscarriage, illness arising from pregnancy, and delivery and/or premature birth of a child. This is applicable for organizations not covered under ESI Act.

The Act provides for 12 weeks of paid leave as maternity leave and 6 weeks in case of miscarriage or termination of pregnancy. In addition to the provisions for leave and cash benefits, the Act also makes provisions for matters like light work for pregnant women 10 weeks prior to her delivery, nursing breaks during daily work till the child attends age of 15 months, etc.

The female employee should have served the institution for a minimum period of 80 days in 12 months preceding the date of expected delivery. The benefits are calculated on the basis of daily average wage for the period of absence of the employee. There is no wage limit for coverage under the Act.

The Payment of Gratuity Act, 1972 (PGA)

It provides for the payment of gratuity to all employees earning wages to do any skilled, semi-skilled, unskilled, manual, supervisory, technical or clerical work, whether the terms of such employment are express or implied, and whether or not such employees are employed in a managerial or administrative capacity.

It applies to factories and other establishments employing ten or more persons. On completion of five years service, the employees are entitled to payment of gratuity of 15 days wages for every completed year of service or part thereof in excess of six months subject to a maximum of Rs.1 million. The wage ceiling for coverage under the Act has been removed since 24.05.1994.

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LAWS RELATING TO WAGES & BENEFITS



Minimum Wages Act 1948

The Act contains list of all employments for which minimum wages are to be fixed by the appropriate Governments. It includes non-agricultural employments and employment in agriculture. It empowers appropriate Government to fix the minimum rates of wages for specified employments. Recently with effect from April 1, 2011 the National Floor Level of Minimum Wage has been raised to Rs. 115 per day.

Payment of Bonus Act 1965

The payment of Bonus Act is applicable to every factory and every other establishment in which 20 or more persons are employed on any day during an accounting year excluding some categories of employees as contained in the Act. PBA mandates payment of bonus to every employee in an accounting year, in accordance with the provisions of this legislation, provided that he or she has worked in the establishment for not less than 30 days and draws a salary or wage not exceeding Rs.10, 000 per month.

Minimum bonus shall be 8.33% of salary/wages earned or Rs. 100 whichever is higher, it is payable on completion of 5 years after 1st Accounting year even if there is no profit. If the allocable surplus exceeds the amount of minimum bonus, then bonus shall be payable at higher rate subject to a maximum 20% of salary/wages. Computation of bonus is to be worked out as prescribed in the Act. Bonus shall be paid within 8 months from the close of accounting year. A register showing the computation of the allocable surplus, another register showing the set-on and set-off of the allocable surplus, and register showing the details of the amount of bonus due to each of the employees, the deductions and the amount actually disbursed must be maintained.

Payment of Wages Act, 1936

Enacted during the British Rule in 1936 on the recommendations of the Royal Commission on Labour, the Act regulates the payment of wages to workers and ensures that they are disbursed by the employers within the stipulated time frame and without any unauthorized deductions. Enforcement of the Payment of Wages Act is primarily the responsibility of the State Governments. The Central Government is responsible to enforce the Act only in mines, railways, oilfields and air transport service by virtue of Section 24 of the Act.

Inspectors are appointed under the provisions of the Act who conduct regular inspections to ensure that the employers pay the wages timely and correctly. Defaulting employers are advised to pay full wages in time.  In case of non-adherence to the advice, there are provisions to prosecute.

The Act lays down that the wage period exceeding one month should not be fixed and payment of wages must be made before the entry of specific day after the last day of the wage period.  The specific day is the seventh day of a month where the number of workers is less than 1000 and tenth day in case the number of workers is 1000 or more.  All wages must be paid in current legal tender.  The wages can also be paid by cheque or credited to the bank account of the employed persons with the written authorization of the letter.  The beneficiary under the Act are, however those who are in receipt of wages below the Rs. 10,000/- per month.

The Act provides that the wages of an employed person shall be paid to him without any deductions except those authorized under the Act.  Deductions permissible from wages inter-alia relates to unauthorized absence from duty, deductions for house accommodations, recovery of advances and statutory dues etc.

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