New Delhi: To promote cashless economy, the Central Cabinet has approved an ordinance to amend the Payment of the Wages Act. The new ordinance will be implemented very soon, which will allow business and industrial establishments to pay salaries through cheque or electronically.
The ordinance is valid for six months. Within that period it is required to be passed in the Parliament otherwise it will have to be introduced again or it will expire. The amendment will be made under the Payment of Wages (amendment) Bill, 2016, Section 6.
The bill was introduced by Labour Minister Bandaru Dattatreya in the winter Parliament session amid uproar over the demonetisation issue. The Central Government hopes that the bill will pass in upcoming budget session.
The state governments would give the details regarding which business and industrial establishments need to pay salaries through cheque or electronically.
As per sources, Andhra Pradesh, Uttarakhand, Punjab, Kerala, Haryana have already made provisions for payment of wages through Cheque or electronic transfers after making state level amendments to the Act.
The government has clarified that until a notification is issued the move is not mandatory.