Salary payment date

Hi,

  1. What is an ideal date to make the salary payment each month? I have seen companies make payments on 31st, 5th, 7th, 10th.
  2. How is the date selected as per rules?
  3. Is it advisable to change from 10th to 5th of month during the year?
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As per the modal shop & establishment act from which most of the states have formed their S&E act, salaries should be paid before 7th of every month.

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Dear Namita,

1.As per Payment of Wages Act, the salary disbursement date should be within 7 days of close of payperiod if number of employees upto 1000 and 10 days if number of employees more than 1000.
2.As per Tamil Nadu Shops & Establishments Act the salary disbursement is 5th of every month.

R.MEENAKSHI SUNDARAM

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Thanks @aakashbhasin @MeenakshiSundaram for the information.

Is it advisable to change from 10th to 5th of month during the middle year? Is there a specific process to change the payment dates or its employer wish?

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Welcome @MeenakshiSundaram Meenakshi Sir.

Nice to see you here.

Hi Namita,

With regard to your queries:

1. What is an ideal date to make the salary payment each month? I have seen companies make payments on 31st, 5th, 7th, 10th.

As per the Payment of Wages Act,

The wages of every person employed upon or in

(a) any railway, factory or industrial or other establishment upon or in which less than one thousand persons are employed, shall be paid before expiry of the seventh day,
(b) any other railway, factory or industrial or other establishment, shall be paid before the expiry of the tenth day,after the last day of the wage-period in respect of which the wages are payable:
Provided that in the case of persons employed on a dock, wharf or jetty or in a mine, the balance of wages found due on completion of the final tonnage account of the ship or wagons loaded or unloaded, as the case may be, shall be paid before the expiry of the seventh day from the day of such completion.

Where the employment of any person is terminated by or on behalf of the employer, the wages, earned by him shall be paid before the expiry of the second working day from the day on which his employment is terminated:

Provided that where the employment of any person in an establishment is terminated due to the closure of the establishment for any reason other than a weekly or other recognized holiday, the wages earned by him shall be paid before the expiry of the second day from the day on which his employment is so terminated.

2. How is the date selected as per rules?

The date is fixed by the Government considering the parameters of economic justice to the workforce under the Payment of Wages Act, and the Shops & Establishments Act.

3. Is it advisable to change from 10th to 5th of month during the year?

The employer can change the date from 10th to any previous dates anytime during the year and may also notify this to the workforce. The law mandates only the point that the wages should be paid well within the stipulated timelines.

Regards,
Bhuvana Anand

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