Maternity, Gratuity & Wages Acts — Set 7

Correct Answer: D. 5 years

Section 3(1)(b) of the Minimum Wages Act provides that the appropriate government shall review the minimum rates of wages fixed under the Act at such intervals as it may think fit, not exceeding five years. This ensures that minimum wages are kept in line with inflation and changing economic conditions. However, governments often revise them more frequently, especially to account for dearness allowance changes.

Correct Answer: A. Section 18

Section 18 of the Minimum Wages Act requires every employer to maintain registers and records in the prescribed form giving particulars of employed persons, work performed, wages paid, receipts given, and other prescribed particulars. These records must be maintained at the workplace and must be available for inspection by the Inspector. Failure to maintain these records is a punishable offence.

Correct Answer: B. Advisory Board

The correct answer is Advisory Board. Section 7 of the Minimum Wages Act provides for the constitution of an Advisory Board by the appropriate government to coordinate the work of committees and sub-committees appointed under the Act. The Advisory Board consists of persons of equal number representing employers and employees in scheduled employments and independent persons not exceeding one-third of its total number. This topic is frequently tested in competitive examinations such as RRB NTPC, SSC, and UPSC.

Correct Answer: B. Any reasonable time, day or night

Under Section 19 of the Minimum Wages Act, an Inspector may at any time enter, inspect and examine any premises or place in which persons are employed or work has been given out, and may require the production of any register or document. The Inspector may seize or take copies of such documents. The inspection can be at any reasonable time including night hours if workers are employed during night.

Correct Answer: C. 20 or more

The Payment of Bonus Act, 1965 applies to every factory and every other establishment in which 20 or more persons are employed on any day during an accounting year. Once the Act applies to an establishment, it continues to apply even if the number of employees falls below 20. New establishments in their first 5 years of starting are exempt from the bonus provisions.

Correct Answer: B. 8.33% of wages

Under Section 10 of the Payment of Bonus Act, the minimum bonus payable to an employee is 8.33% of the wages earned during the accounting year, or Rs. 100 whichever is higher. This minimum bonus is payable irrespective of whether the employer has allocable surplus or not. The 8.33% corresponds to one month's salary (1/12 of annual salary). It must be paid within 8 months of the close of the accounting year.

Correct Answer: C. 20% of wages

Under Section 11 of the Payment of Bonus Act, the maximum bonus payable to an employee shall not exceed 20% of wages. If the employer has allocable surplus, they can pay more than 8.33%, but the ceiling is 20%. This maximum was revised from 10% to 20% by the Payment of Bonus (Amendment) Act 1985. An employee receiving salary above Rs. 21,000 per month is not eligible for statutory bonus.

Correct Answer: B. Fraud, riotous behaviour, or theft

The correct answer is Fraud, riotous behaviour, or theft. Section 9 of the Payment of Bonus Act provides that an employee shall be disqualified from receiving bonus if he is dismissed from service for fraud or for riotous or violent behaviour while on the premises of the establishment, or for theft, misappropriation or sabotage of any property of the establishment. This disqualification is an exception to the general entitlement to bonus. This topic is frequently tested in competitive examinations such as RRB NTPC, SSC, and UPSC.

Correct Answer: C. 90 days

Under Section 8 of the Payment of Bonus Act, every employee is entitled to be paid bonus in an accounting year if they have worked in the establishment for not less than 30 working days in that year. However, the bonus is calculated on the basis of the days actually worked. If an employee worked for at least 30 days but less than full year, bonus is calculated proportionately.

Correct Answer: C. 20 or more

The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) applies to every establishment that employs 20 or more persons. The Central Government can extend the Act to any establishment employing less than 20 persons by notification. Once the Act applies, it continues to apply even if the number falls below 20. This is one of the most important social security Acts in India.