Maternity, Gratuity & Wages Acts — Set 16

Correct Answer: C. Any person employed on wages in any capacity including skilled, semi-skilled, unskilled

The correct answer is Any person employed on wages in any capacity including skilled, semi-skilled, unskilled. Section 2(e) of the Payment of Gratuity Act defines 'employee' as any person who is employed for wages, whether the terms of such employment are express or implied, in any kind of work, manual or otherwise, in or in connection with the work of a factory, mine, oilfield, plantation, port, railway company, shop or other establishment. The definition is broad and inclusive, covering skilled, semi-skilled, and unskilled workers. This topic is frequently tested in competitive examinations such as RRB NTPC, SSC, and UPSC.

Correct Answer: C. All remuneration including overtime but excluding house rent allowance, travel allowance, and bonus

The Minimum Wages Act defines 'wages' to include all remuneration (whether by way of salary, allowances or otherwise) which can be expressed in terms of money and which would, if the terms of employment were fulfilled, be payable to a person. It excludes house rent allowance, overtime wages, bonus, travel allowance, and any other special allowances. Minimum wages must be paid on this basis.

Correct Answer: C. Registers, records, and documents relating to wages

The correct answer is Registers, records, and documents relating to wages. Under Section 14-A of the Payment of Wages Act, an Inspector may examine any person employed or found on the premises, require the production of any register, muster roll or other document maintained in relation to the employment or the payment of wages, seize or take copies of such documents, or exercise such other powers as may be prescribed. This wide power enables effective enforcement. This topic is frequently tested in competitive examinations such as RRB NTPC, SSC, and UPSC.

Correct Answer: C. Life Insurance Corporation, certain class of teachers

Section 32 of the Payment of Bonus Act excludes several categories of employees from its provisions. Life Insurance Corporation employees are excluded as they have a separate scheme. Other excluded categories include employees of universities and educational institutions, hospitals and dispensaries, and charitable institutions. Employees of the Central Government and State Government are also excluded.

Correct Answer: B. Portable number that remains same across employers enabling PF portability

The Universal Account Number (UAN) is a 12-digit unique number allotted to each EPF member. The UAN remains portable and constant throughout the working life of an employee regardless of change in employment. It enables easy transfer of PF accumulations when changing jobs without lengthy paperwork. The UAN was introduced to reduce administrative burden and speed up claim settlements at the EPFO.

Correct Answer: B. 1984

The Payment of Gratuity Act 1972 was amended in 1984 to extend its coverage to all establishments in which 10 or more employees were employed, not just factories and mines as originally covered. The 1984 amendment broadened the scope significantly. Earlier amendments had also been made in 1982. Subsequently, the 2018 amendment increased the maximum gratuity ceiling to Rs. 20 lakhs.

Correct Answer: B. Dearness allowance to compensate for rise in cost of living

Under the Minimum Wages Act, minimum wages can be fixed as a basic rate plus a special allowance or the cost of living allowance. The cost of living allowance (also called dearness allowance) is a variable component designed to compensate workers for increases in the cost of living due to inflation. It may be revised periodically based on the cost of living index. This ensures the real value of wages is maintained.

Correct Answer: B. Bonus is proportionate to days worked

Under the Payment of Bonus Act, the bonus is calculated on the basis of the wages earned by the employee during the accounting year. If an employee was on a legal strike for part of the year, only the wages actually earned are considered for bonus calculation. Time spent on illegal strikes is treated as unauthorized absence from duty and is not counted. Time spent on legal strikes is generally counted.

Correct Answer: C. Transport provided by employer

Section 11 of the Payment of Wages Act allows deductions for value or amenities and services supplied by the employer as approved by the State Government or an authorized officer. These include transport, housing, canteen food, and other amenities provided by the employer. However, the deduction cannot exceed the actual cost of the amenity. The deduction must be for services actually rendered and used by the employee.

Correct Answer: B. 1948

The Minimum Wages Act was enacted in India in 1948 to safeguard the interests of workers in organized and unorganized sectors. Under this Act, the appropriate government has the authority to fix minimum wages for scheduled employments. The Act has been subsumed into the new Code on Wages 2019 under labour law consolidation.