Hi seniors,
I am working in a company as an HR executive. One employee has requested me to pay the salary in cash because of personal reasons, so I want to draft a letter as proof so that no issues or claims are raised by the employee in the future. Please send me a letter format or a letter as soon as possible.
Regards,
Bimlendu
From India, Delhi
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I am working in a company as an HR executive. One employee has requested me to pay the salary in cash because of personal reasons, so I want to draft a letter as proof so that no issues or claims are raised by the employee in the future. Please send me a letter format or a letter as soon as possible.
Regards,
Bimlendu
From India, Delhi
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Dear Bimlendu,
Kindly ask the employee to submit the request in his own handwriting as a written application, with the reasons mentioned therein, along with his signature, employee code, and name. File this application in the personal file. There is no need for you to provide him with any return letter.
Also, if there is no policy in your company to pay by cash, please refrain from making exceptions. This will only create more work for you. ATMs are as good as receiving salary in cash. Additionally, you will have to create cash vouchers for his salary, obtain his signatures, and file them properly for verification. In contrast, with bank transfers, the process is much easier and the data is stored with an external party (duplicate data). Therefore, it is advisable to refrain from making exceptions.
Regards,
Ashutosh Thakre
From India, Mumbai
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282Kindly ask the employee to submit the request in his own handwriting as a written application, with the reasons mentioned therein, along with his signature, employee code, and name. File this application in the personal file. There is no need for you to provide him with any return letter.
Also, if there is no policy in your company to pay by cash, please refrain from making exceptions. This will only create more work for you. ATMs are as good as receiving salary in cash. Additionally, you will have to create cash vouchers for his salary, obtain his signatures, and file them properly for verification. In contrast, with bank transfers, the process is much easier and the data is stored with an external party (duplicate data). Therefore, it is advisable to refrain from making exceptions.
Regards,
Ashutosh Thakre
From India, Mumbai
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Being an HR Executive, you are not responsible for distributing salary, but the accounts department is. Therefore, you can ask the employee to contact them directly.
If you have no such system and only HR is responsible for distributing salary, you still don't need to pay in cash. Instead, you can transfer the salary amount to the employee's personal bank account (if they do not have an individual employee bank account) by having them sign an authorization letter for providing 'bank details for transferring the salary to the employee's personal bank account directly'.
You must adhere to the organizational policies and rules created by the authority, and the employee in question can withdraw the amount anytime. No personal reasons or excuses in this regard are applicable. Be professional.
From India, Gurgaon
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If you have no such system and only HR is responsible for distributing salary, you still don't need to pay in cash. Instead, you can transfer the salary amount to the employee's personal bank account (if they do not have an individual employee bank account) by having them sign an authorization letter for providing 'bank details for transferring the salary to the employee's personal bank account directly'.
You must adhere to the organizational policies and rules created by the authority, and the employee in question can withdraw the amount anytime. No personal reasons or excuses in this regard are applicable. Be professional.
From India, Gurgaon
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(Fact Check Failed/Partial)-The user's reply contains incorrect information. As an HR executive, you are responsible for payroll processes. It's essential to follow legal requirements and organizational policies regarding salary payments. Consider implementing secure payment methods like bank transfers.
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Dear Bimlendu,
As per the Payment of Wages Act, the salary should be paid in cash. If the net salary exceeds Rs. 20,000/-, then you cannot pay the salary in cash but must pay by means of a cheque as per the provisions of the Income Tax Act, 1961. Since the employee is requesting to be paid in cash subject to the above terms, you can do so. Nowadays, most organizations disburse salaries through banks by crediting employees' respective bank accounts. This is the standard practice for salary disbursement. Regardless of the payment method, you should ensure you have the employees' acknowledgment on your wage register or payslip as required under the Payment of Wages Act.
Adoni Suguresh Sr. Executive (Pers, Admin & Ind. Rels) Rtd Labour Laws Consultant
From India, Bidar
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As per the Payment of Wages Act, the salary should be paid in cash. If the net salary exceeds Rs. 20,000/-, then you cannot pay the salary in cash but must pay by means of a cheque as per the provisions of the Income Tax Act, 1961. Since the employee is requesting to be paid in cash subject to the above terms, you can do so. Nowadays, most organizations disburse salaries through banks by crediting employees' respective bank accounts. This is the standard practice for salary disbursement. Regardless of the payment method, you should ensure you have the employees' acknowledgment on your wage register or payslip as required under the Payment of Wages Act.
Adoni Suguresh Sr. Executive (Pers, Admin & Ind. Rels) Rtd Labour Laws Consultant
From India, Bidar
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(Fact Check Failed/Partial)-The user's reply contains some inaccuracies. According to the Payment of Wages Act, if the net salary exceeds Rs. 18,000, it should be paid through electronic transfer, not in cash. The Income Tax Act also mandates non-cash payments. Therefore, the suggestion to pay in cash is incorrect.
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Please remember one rule. Exception made in the standard policy/policies of the company becomes precedent in the longer term (for other employees to quote against the one who has made the exception) and creates more problems for HR personnel. Therefore, payment of salary should be through bank only.
From India, Pune
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From India, Pune
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(Fact Checked)-The user reply is correct. Payments of salary should be done through bank to avoid future issues or claims. Encouraging compliance with standard policies is essential. (1 Acknowledge point)
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Hi Bimlendu,
In addition to the views expressed above, please ensure that creating an exception (of paying cash) does not pose problems to the accounts department and to your organization as a bad precedence.
V. Raghunathan
From India
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In addition to the views expressed above, please ensure that creating an exception (of paying cash) does not pose problems to the accounts department and to your organization as a bad precedence.
V. Raghunathan
From India
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(Fact Checked)-The user's reply is correct. It emphasizes the importance of considering the impact on the accounts department and the organization before making exceptions in paying salary in cash. (1 Acknowledge point)
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Under Section 1(6) of the Payment of Wages Act, 1936, any employee drawing a wage of more than Rs. 10,000 per month will stand excluded from the purview of the Act. This would mean that such a worker cannot insist on payment of his wages in cash as a matter of right. It is not clear from the query if the worker involved is such an excluded worker. Assuming that he is, you can accommodate his request for payment in cash, provided such cash payment does not exceed Rs. 20,000, so that you do not get involved in Income Tax Rules violations, as rightly mentioned by Mr. Adoni Suguresh.
Pradeep Sukumar
From India, Coimbatore
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Pradeep Sukumar
From India, Coimbatore
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(Fact Checked)-[The user's reply contains accurate information regarding the Payment of Wages Act, 1936 and the exemption for employees earning above Rs. 10,000 per month. The advice on accommodating the request for cash payment within the Income Tax Rules limit is also valid.] (1 Acknowledge point)
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first if all you should ask the employee to share as what are the personal reasons due to which he is asking the salary in cash. it is very difficult to assume .
From India, Delhi
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From India, Delhi
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(Fact Check Failed/Partial)-The user reply is incorrect. According to the law, paying salaries in cash without proper documentation can lead to legal and tax issues. It's essential to follow legal guidelines.
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Hi, I am working in a company as a Accountant & my salary 16,000/-. Can any one give me the salary format of 16,000/-. Regards Mahesh Samant
From India, Bhubaneswar
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From India, Bhubaneswar
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(Fact Check Failed/Partial)-The user reply is incorrect as it does not address the original query about drafting a letter for paying salary in cash. Amendment needed.
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(Fact Check Failed/Partial)-The user reply contains inaccurate information. It is essential to follow legal regulations and company policies when it comes to salary payments. Instead of asking for a handwritten letter from the employee, it's important to document the request formally according to company procedures and applicable laws.