Background
Code on Wages, 2019 is a Central legislation that consolidates four pre-existing Central labour laws — the Minimum Wages Act, 1948, the Payment of Wages Act, 1936, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976 — into a unified framework governing wages, remuneration, minimum wages, and bonus across all establishments in India. The Code extends coverage of minimum wage protection to all employees regardless of the sector of employment, eliminating the earlier scheduled-employment restriction. At the State level, the Government of Rajasthan has notified the Code on Wages (Rajasthan) Rules, 2026 (“the Rajasthan Rules”) to operationalise the Code’s provisions within the State. The Rajasthan Rules prescribe the manner of calculating minimum wages, the maximum weekly and daily working hours and spread-over limits, rest day and overtime entitlements, procedures for imposition and recovery of fines, permissible deductions and their limits, advance recovery instalments, nominee-related obligations on employers, register formats (Form I, IV, V), the notice display requirement (Form VI), wage slip format (Form VII), and the nomination form (Form X). For bonus obligations, the Code on Wages (Central) Rules, 2020 apply alongside the Rajasthan Rules.
Applicability
Code on Wages, 2019 and the Code on Wages (Rajasthan) Rules, 2026 apply to all employers of establishments in Rajasthan to which the Code applies, covering every industry, trade, business, and service sector. Every employer is required to pay minimum wages as notified, overtime at double the normal rate, and wages within prescribed timelines on a daily, weekly, fortnightly, or monthly basis. All employers engaging contract labour must ensure timely payment through contractors and — where contractors default — must directly pay minimum bonus to contract employees. Register maintenance in Forms I, IV, and V, display of the Form VI notice, and issuance of Form VII wage slips apply to all covered employers, with an exemption from certain register-maintenance obligations for employers of not more than five persons for agriculture or domestic purposes. Bonus obligations under Sections 26(1) to 26(9) apply to employers covered by Chapter IV of the Code with respect to eligible employees. Nomination-related obligations — including receipt and management of Form X nominations, payment to nominees, and deposit of undisbursed amounts with the State Authority — apply to all covered employers.
Key Compliances Requirement Under Rajasthan Code on Wages, 2026
No employer shall pay to any employee wages less than the minimum rate of wages applicable to the establishment under the Code. The minimum rate of wages is calculated in the manner set out in Rule 3 of the Code on Wages (Rajasthan) Rules, 2026. The components of minimum wages are as specified in Section 7 of the Code on Wages, 2019, which prescribes that minimum wages shall consist of a basic rate of wages and a cost of living allowance — or an all-inclusive rate combining both — as fixed by the appropriate Government.
Where an employee whose minimum rate of wages has been fixed by the day works on any day for a period less than the requisite number of hours constituting a normal working day, the employee is entitled to receive wages in respect of work done on that day as if they had worked for a full normal working day. This entitlement does not apply where: (i) the employee’s failure to work is caused by their own unwillingness and not by the employer’s omission to provide work; (ii) in such other cases and circumstances as may be prescribed; or (iii) the employee is not entitled to such wages under any other law in force.
Where an employee whose minimum rate of wages has been fixed by the hour, by the day, or by the month works on any day in excess of the number of hours constituting a normal working day, the employer must pay the employee for every hour or part of an hour so worked in excess at the overtime rate, which shall not be less than twice the normal rate of wages. The longer wage period for the purposes of minimum rate of wages under Section 14 shall be by the month under Rule 10 of the Rajasthan Rules.
Employers must pay or cause to be paid wages to employees within the following timelines: for employees engaged on a daily basis, at the end of the shift; for weekly basis, on the last working day of the week before the weekly holiday; for fortnightly basis, before the end of the second day after the end of the fortnight; and for monthly basis, before the expiry of the seventh day of the succeeding month. Where separate due dates have been specified by the State Government under Rajasthan’s applicable laws, the State-specified date applies.
Where an employee has been removed or dismissed from service, retrenched, has resigned, or has become unemployed due to the closure of the establishment, all wages payable to such employee must be paid within two working days of their removal, dismissal, retrenchment, or resignation, as the case may be.
Where employees are employed in an establishment through a contractor, the principal employer — being the company, firm, association, or other person who is the proprietor of the establishment — must pay to the contractor the amount payable before the date of payment of wages, so that wages are paid to the employees positively in accordance with the timelines under Section 17 of the Code. The principal employer bears responsibility for ensuring timely wage payment to contract employees through the contractor.
There shall be no deductions from the wages of any employee except those as are authorised under the Code. Any payment made by an employee to the employer or their agent shall be deemed to be a deduction from wages. Loss of wages resulting from: (i) withholding of increment or promotion; (ii) reduction to a lower post or time-scale; or (iii) suspension — is also treated as a deduction, unless otherwise provided by the respective State Government.
The total amount of all deductions that may be made in any one wage period from the wages of an employee shall not exceed fifty percent of such wages. If total deductions in any wage period would exceed fifty percent, the excess shall be carried forward and recovered from the wages of the succeeding wage period in instalments, subject to the condition that recovery in any such month shall not exceed fifty percent of the wages payable to the employee in that month.
Deductions for absence from duty shall not bear to the wages payable for the wage period a proportion larger than the proportion that the period of absence bears to the total period during which by the terms of employment the employee was required to work in that wage period. Where ten or more employees acting in concert absent themselves without due notice and without reasonable cause, the deduction from any such employee may include an amount not exceeding wages for eight days, subject to State law. An employee who is present at the workplace but refuses to work — whether in pursuance of a stay-in strike or for any other unreasonable cause — is deemed absent from the place where they are required to work.
Where an employer makes a deduction under the proviso to Section 20(2) — being a deduction in respect of group absence by ten or more employees acting in concert without due notice — the employer must intimate such deduction to the Inspector-cum-Facilitator having jurisdiction within ten days from the date of the deduction, with an explanation of the reason for the deduction.
Before making a deduction for damage or loss, the employer must: (i) explain to the employee personally and in writing the damage or loss to goods expressly entrusted to the employee for custody, or the loss of money for which the employee is required to account, and how such damage or loss is directly attributable to the employee’s neglect or default; and (ii) give the employee an opportunity to submit any explanation. Any deduction so made must then be intimated to the employee in writing within fifteen days from the date of the deduction.
A deduction for damage or loss shall not exceed the amount of the damage or loss actually caused to the employer by the negligence or default of the employee. No deduction shall be made until the employee has been given an opportunity of showing cause against it or otherwise in accordance with the prescribed procedure for making such deductions.
Deductions for house accommodation, amenities, or services supplied by the employer shall not be made from an employee’s wages unless the house accommodation, amenity, or service has been accepted by the employee as a term of employment or otherwise. Such deductions shall not exceed an amount equivalent to the value of the house accommodation, amenity, or service supplied and are subject to such conditions as the appropriate Government may impose.
Deductions for recovery of advances of money given before employment began shall be made from the first payment of wages in respect of a complete wage period, but no recovery shall be made for advances given for travelling expenses. Advances given after employment begins or advances of wages not yet earned shall be recovered in instalments so that the recovery in any one wage period shall not exceed fifty percent of the wages payable to the employee in that period. Details of advance recovery shall be recorded in Form I.
Deductions for recovery of loans granted for house building or other purposes approved by the State Government, and the interest thereon, shall be subject to any direction or circular issued by the State Government regulating the extent to which such loans may be granted and the rate of interest payable thereon.
A notice specifying the acts and omissions for which fines may be imposed on employees must be displayed at conspicuous places in the premises where employment is carried on, in a manner that enables every concerned employee to easily read its contents. A copy of the notice must be sent to the Inspector-cum-Facilitator having jurisdiction.
The total amount of fines that may be imposed on any employee in any one wage period shall not exceed three percent of the wages payable to that employee in respect of that wage period. Before imposing a fine, the employer must give written intimation to the Authority prescribed under Rule 13, specifying the detailed particulars, and must seek approval. The Authority must give both the employee and the employer an opportunity of being heard before granting or refusing approval.
No fine shall be imposed on any employee who is under the age of fifteen years.
No fine imposed on any employee shall be recovered by instalments or after the expiry of ninety days from the day on which the fine was imposed.
No employee shall be required or allowed to work in any establishment for more than forty-eight hours in any week. For employees working on a daily basis, the period of work — inclusive of the rest interval — shall not spread over more than ten and a half hours per day. Certain specified categories of employees under Section 13(2) may work beyond normal hours, subject to payment of overtime at the rates prescribed under Section 14. Working hours for agricultural employment may be modified by the State Government.
Where an employee works for six days in a week, the period of work — inclusive of the rest interval — shall not spread over more than ten and a half hours on any working day, and the seventh day of that week shall be a paid holiday for the employee.
No employee shall be required or allowed to work for more than five hours continuously before having an interval for rest of at least half an hour. This requirement is subject to modifications for agricultural employment as may be determined by the State Government.
Every employee is entitled to rest on one or more days every week — ordinarily Sunday in a six-day week, and both Saturday and Sunday in a week of fewer than six working days — though the employer may fix any other day or days as rest days for any employee or class of employees. The remaining days of the week shall be paid rest days. An employee is entitled to rest days only after working the requisite continuous period under the same employer. The employer must display a notice at a conspicuous place informing employees of the designated rest days and any subsequent change, before it takes effect. Days on which an employee attends without work with allowance, days of lay-off with compensation, and leave or holidays immediately preceding rest days are deemed days worked for the purpose of computing the qualifying continuous period.
An employee shall not be required or allowed to work on a rest day unless they have, or will have, a substituted rest day for a whole day on one of the working days in the week immediately before or after the rest day. No substitution shall be made that results in the employee working for more than ten consecutive days without a rest day. Where an employee works on a rest day and is given a substituted rest day, the rest day is included — for computing weekly hours — in the week in which the substituted rest day falls.
An employee must be paid wages for the rest day at the rate applicable to the next preceding day — meaning the last day the employee actually worked immediately before the rest day. Where the employee works on a rest day and is given a substituted rest day, the employee must be paid at the overtime rate for the day worked and at the rate applicable to the next preceding day for the substituted rest day. In a six-day working week where the employee’s minimum or actual daily rate (calculated by dividing the monthly rate by 26, with the actual rate not less than the minimum) already factors in the rest day, no separate rest-day wages are payable; if such an employee works on the rest day and is given a substituted rest day, only the overtime rate is payable for the day worked. For piece-rate employees, wages for the rest day worked are at the overtime rate and for the substituted rest day at the rate applicable to the next preceding day.
Where an employee works on a shift that extends beyond midnight: (a) a rest day for the whole day under Rule 7 means a period of twenty-four consecutive hours beginning from the time the shift ends; and (b) the following day means the period of twenty-four hours beginning from when the shift ends, and the hours after midnight during which the employee worked are counted towards the previous day. For specified categories of employees under Section 13(2), actual hours of work — excluding rest intervals and periods of inaction during duty — shall not exceed nine hours in any day, and the spread-over of working hours shall not exceed sixteen hours in any day.
Every employer must maintain the following records in Form I, electronically or otherwise: (a) all fines imposed and all realisations thereof as required under Section 19(8), applicable to such purposes beneficial to the persons employed as are approved by the prescribed authority; (b) all deductions for damage or loss and all realisations thereof as required under Section 21(3); and (c) the general register required under Section 50(1) covering persons employed, muster roll, wages, and other prescribed details. This requirement is not applicable to employers who employ not more than five persons for agriculture or domestic purposes.
Every employer of an establishment to which the Code applies must maintain an employee register in Form IV, electronically or otherwise. This register covers all persons employed in the establishment and must be maintained alongside the Form I register and the Form V muster roll and overtime register. The requirement does not apply to employers who employ not more than five persons for agriculture or domestic purposes.
Every employer must maintain attendance records and details of overtime work in Form V, electronically or otherwise, alongside the Form I and Form IV registers. The muster roll must be maintained at all times and must reflect actual attendance and overtime worked by each employee. This requirement does not apply to employers who employ not more than five persons for agriculture or domestic purposes.
Every employer must display a notice in Form VI on the notice board at a prominent place of the establishment. The notice must contain: the abstract of the Code on Wages, 2019; category-wise wage rates of employees; the wage period; the day or date and time of payment of wages; and the name and address of the Inspector-cum-Facilitator having jurisdiction.
Every employer must issue a wage slip in Form VII — electronically or otherwise — to every employee on or before the date of payment of wages. The wage slip must be issued for every wage period and must accurately reflect the wages paid and all deductions made.
All amounts payable to an employee under the Code that cannot be paid due to the employee’s death before payment, or because the employee’s whereabouts are not known, must: (a) be paid to the person nominated by the employee in accordance with the rules; or (b) where no nomination has been made or where for any reason the amounts cannot be paid to the nominee, be deposited with such prescribed authority, which shall deal with the deposited amounts in the prescribed manner.
Every employee must make a declaration in Form X nominating a person to receive the amount standing to their credit in the event of death. Where the employee has a family, the nomination must be in favour of the spouse (in preference) or one or more family members; a nomination in favour of a person other than a family member is invalid where the employee has a family. Where a nominee is a minor, the employee must appoint a major family member — or, if none, any other person — as guardian of the minor nominee. Where more than one nominee is named, the share payable to each must be specified. On marriage, a fresh nomination in favour of the spouse must be made and any prior nomination is deemed invalid.
Where amounts payable to an employee remain undisbursed — because no nomination has been made or for any other reason the amounts cannot be paid to the nominee — and remain unremitted for six months from the date the amount became payable, the employer must deposit all such amounts with the Authority notified by the State Government having jurisdiction, before the expiry of the fifteenth day after the last day of the said six-month period, through bank transfer or demand draft in favour of the Authority.
Every employer must pay an annual minimum bonus to every employee who has put in at least thirty days’ work in an accounting year and whose wages do not exceed the amount per month as determined by the appropriate Government by notification. The minimum bonus is calculated at eight and one-third percent of the wages earned by the employee during the accounting year, or ₹100, whichever is higher, regardless of whether the employer has any allocable surplus. Employers must monitor the currently notified wage ceiling for bonus eligibility.
For the purpose of calculating bonus, where an employee’s actual wages exceed the amount per month determined by notification, bonus payable under Sections 26(1) and 26(3) shall be calculated as if their wages were the notified ceiling amount, or the minimum wage fixed by the appropriate Government, whichever is higher.
Where for any accounting year the allocable surplus exceeds the amount of minimum bonus payable under Section 26(1), the employer must pay every eligible employee — instead of the minimum bonus — bonus in proportion to the wages earned during that accounting year, subject to a maximum of twenty percent of such wages.
Any bonus linked with production or productivity for an accounting year must be determined by an agreement or settlement between the employer and the employees. The total bonus including the annual minimum bonus shall not exceed twenty percent of the wages earned by the employee in that accounting year. All productivity-linked bonus settlements must be documented and must not breach the twenty percent overall ceiling.
In the first five accounting years following the year in which the employer first sells goods or renders services from the establishment, bonus is payable only for an accounting year in which the employer derives profit — computed without applying the set on or set off provisions of Section 36. For the sixth and seventh accounting years, set on or set off applies but only with reference to the fifth (and for the seventh year, fifth and sixth) accounting years’ allocable surplus. From the eighth accounting year onward, Section 36 applies in the normal manner. An employer is not deemed to have derived profit in a year unless depreciation has been provided for and prior years’ arrears of depreciation and losses have been fully set off. Sales during a factory’s trial run or a mine’s or oil-field’s prospecting stage are excluded from the profit computation. These provisions also apply to new departments, undertakings, or branches of existing establishments.
Where employees in an establishment are employed through a contractor and the contractor fails to pay the minimum bonus due to them under Section 26, the principal employer — being the company, firm, association, or other person referred to in the proviso to Section 43 — must, on receiving written information of such failure from the employees or their registered trade union and on confirming the failure, pay the minimum bonus to the employees directly.
Penalty & Consequences
Section 54(1)(b) of the Code on Wages, 2019 — Paying Less than Minimum Wages or Amounts Due
Any employer who pays to any employee less than the amount due under the provisions of the Code — including minimum wages, overtime wages, wages for short-working-day, rest-day wages, bonus, and all other amounts — shall be punishable with a fine which may extend to ₹50,000. Where the employer is again found guilty of a similar offence within five years from the date of commission of the first or subsequent offence, the employer shall on the second and each subsequent commission of the offence be punishable with imprisonment for a term which may extend to three months, or with a fine which may extend to ₹1,00,000, or with both.
Section 54(1)(a) of the Code on Wages, 2019 — Contravention of any Other Provision of the Code or Rules
Any employer who contravenes any other provision of the Code on Wages, 2019 or any rule made or order issued thereunder — including provisions relating to deductions, fines, working hours, rest days, registers and records, wage slips, notice display, nominee payments, and deposit of undisbursed dues — shall be punishable with a fine which may extend to ₹20,000. Where the employer is again found guilty of a similar offence within five years from the date of commission of the first or subsequent offence, the employer shall on the second and each subsequent commission be punishable with imprisonment for a term which may extend to one month, or with a fine which may extend to ₹40,000, or with both.
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