Under Section 54 of the Code on Wages, 2019, what is the

Solution

Section 54 of the Code on Wages, 2019 introduces a graded penalty system a significant improvement over the fragmented and inconsistent penalty provisions under the earlier four Acts. For a first offence of paying any employee less than the amount due whether as minimum wages, bonus, or any other entitlement the employer is punishable with a fine of up to ₹50,000. If the same offence is repeated within 5 years, the penalty escalates to imprisonment for up to 3 months, or fine up to ₹1 lakh, or both. For contravention of any other provision of the Code, the penalty is a fine of up to ₹20,000 for the first offence. The Code also provides for compounding of offences under Section 53, where designated officers of the appropriate Government can impose a penalty without court proceedings to reduce litigation burden. This graded approach is designed to act as a strong deterrent while giving first-time offenders a less severe initial consequence.