Payment Methods for Salaries: Is Manual Cash Deposit to Bank Accounts Acceptable?

Quoting The Payment of Wages Act, 1936:

Wages to be paid in current coin or currency notes

All wages shall be paid in current coin or currency notes or in both. [Provided that the employer may, after obtaining the written authorization of the employed person, pay him the wages either by check or by crediting the wages in his bank account.]

The above statement is not very clear. It says the employer can pay wages or salary by check or by crediting the wages or salary to the bank account. When we say credit to the bank account, doesn't that mean by 'Bank to Bank Transfer' or can the employer credit cash to the Salary account? My employer manually deposits salaries to our accounts in CASH mode. Is this fine or should it be 'Bank to Bank Transfer'?

Hi Partner,

By bank-to-bank transfer, I believe you would be referring to the electronic mode such as NEFT transfer. If this is the case, it would be just one of the methods for salary credit. As long as your employer is crediting your salary into your bank account, even a direct cash deposit to your account should be acceptable as long as there is a record indicating that your employer is crediting the cash as your salary into your bank account.