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Cabinet approves ordinance to let industries pay salary via e-mode or cheques
On Wednesday, the Cabinet approved a draft ordinance to allow business and industrial establishments to pay salaries of their staff through cheques or electronically credit it their bank accounts.

"The government proposes to bring an amendment to Section 6 of the Payment of Wages Act which will further provide crediting the wages in the bank account of the employees or payment through cheque along with the existing provisions of payment in current coin or currency notes," a cabinet statement read.

The ordinance will bring an amendment to the Section 6 of the Payment of Wages Act, 1936 to facilitate the salary transfer.

As per the existing Act, the wages need to be paid in coin or currency notes, or in both. It also includes a provision under which wages can be paid by cheque or crediting it into bank account directly but such a move would require prior authorisation of employee.

"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 Labour Ministry said in a proposal dated December 2.

This move comes in line with the government's attempt to move to a cashless economy.

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