Payment of Wages

Payment of Wages Act, 1936 Compliance

Guarantee timely and correct payment of wages with legally authorized deductions, fostering trust and avoiding disputes.

Introduction and Value Proposition

The Payment of Wages Act, 1936, ensures that employees receive their wages on time and without unauthorized deductions. It strictly regulates the timing of wage payments and the specific types of deductions that can be made from an employee's salary. Violations can lead to severe penalties, employee dissatisfaction, and legal claims. PCS provides expert advisory services to help you establish robust payroll processes that are fully compliant, ensuring transparency and building employee confidence.

Why Choose PCS?

● Clarity on Deductions: We provide absolute clarity on what you can and cannot deduct from an employee’s wages.

● Process Optimization: We help you streamline payroll timing to consistently meet legal deadlines.

● Dispute Prevention: Transparent and lawful payroll practices prevent conflicts and build employee trust.

Key Challenges We Solve

● Unauthorized Deductions: Risk of making deductions that are not permitted under the Act, leading to disputes.

● Timely Payment: Ensuring wages are paid within the prescribed time limits (e.g., before the 7th/10th of the following month).

● Deduction Limits: Correctly applying statutory limits on certain deductions (e.g., fines cannot exceed 50% of a day’s wage).

● Record Maintenance: Maintaining obligatory registers and records to prove compliance during inspections.

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Payroll Timing Compliance

Ensuring your payroll processing and disbursement schedules adhere to the Act's strict timelines.

Deduction Advisory

Expert guidance on what deductions are legally permissible (e.g., fines, absence from duty, damage/loss of goods, PF, advances) and which are not.

NATS Portal Management

End-to-end management of the National Apprenticeship Training Scheme portal, including all submissions and communications.

Stipend Compliance

Expert support for Act compliance and assessment of apprenticeship obligations.

Liaison with Authorities

End-to-end management of apprentice contract documentation and approvals.

Compliance Audits

Internal audits of apprenticeship programs to identify and fix compliance gaps.

Frequently asked questions:

What is the time limit for paying wages?

For establishments with less than 1,000 employees, wages must be paid before the 7th of the following month. For larger establishments, it's before the 10th.
Can I deduct for breakage or loss of goods?

Yes, but only after giving the employee an opportunity to show cause and following a fair process. There are also limits on such deductions.
Are there any deductions that are completely prohibited?

Yes, deductions for services or goods provided by the employer (unless expressly authorized) are generally not permitted.

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