Demonetization of Rs. 500 and Rs. 1000 was meant to curb corruption. But the people who are heavily affected by the bold move of Prime Minister Narendra Modi were the daily wage workers. Section 6 of the payment of wages Act of 1936 states that payment of wages should be made in cash. This has made it difficult for the daily wage workers to survive as companies are failing to generate wages due to the present cash crunch. Keeping this in mind, the Union Labour Ministry proposed changes to the Section 6 of the Payment of Wages Act,1936, seeing that the economy is going cashless.
The amendment of the law will allow employers to obtain a written permission from the workers, in turn, granting employers to either pay by cheque or by crediting the wages to the worker’s bank account. On 2nd December, the labor Ministry stated in a proposal, “One of the reasons for the ineffective enforcement of payments of wages to workers is the payment of wages in cash. So, the payment of wages only through cheque or through bank transfer in the bank account of employed persons will reduce the complaints regarding non-payment or less payment of minimum wages, besides serving the objectives of digital and less cash economy.”
The Ministry said that the proposal will be considered from 16th December 2016. The new proposal will not only help in promoting cashless transactions but will also help in meeting the needs of the lower sections of the society.
