System of Internal Check as Regards to Wage Payments for a Large Manufacturing.
In case of a large manufacturing where the number of workers is large, a satisfactory system of internal check should be introduced to avoid: Payment of more wages than due, due to incorrect or incomplete record of time or piece wage record. Inclusion of fictions names of dummy or ghost workers in the wage sheets.
The Internal Check System of Wage Payment Divided in Three parts –
- Recording of time,
- Preparation of wage sheet, and
- Payment of wages,
Generally for this purpose, a wage department is set up in the factory under a responsible officer. This department is responsible for the preparation of wage sheet and payment of wages to workers.
Recording of Time:
Generally, each workers is given a time card on which details about the person, rates of wages, date of increment, if any and other related instructions are given. Daily time spent by the person on the job is recorded on this card.
Devices for Recording Time—
Time Recording Clock: A time office at the entrance of the factory records the time of entry and exit of each worker with the help of a recording clock. The worker puts his card in the slot of the clock and the date and time are recorded on this card. In this way correct and clear record of time spent in the factory is put on the card.
Token System: Under this system, a token duly numbered is issued to each worker who keeps it hanging on this board meant for the purpose. When he enters the gate, time keeper records his attendance in the attendance register.
Attendance Card: In some business houses, attendance card are issued to workers. He drops the card in the box meant for the purpose, and collects in the evening .The time office/gate keeper records his attendance on the card.
Piece work record: When wages are paid on the basis of work done, a job card is issued to each worker and the amount of work done by a worker is recorded on this card under the signatures of workman and foreman.
Over time Record: When a worker is given overtime work,he is issued on overtime step on which details about his name, duty time etc., are given by the works managers duly certified by the foreman of the department. In some cases, time card or job card has separate place to note the overtime work. A separate record is also maintained for overtime work which is submitted to the time office at the end of the month.
Preparation of wage sheet:
At the end of the jobs, job cards/attendance register job cards, overtime slips etc. are submitted to the wage department which prepares the wage sheet on the basis of these records separately for time wages and for piece wages. Wage sheets of different departments are prepared separately. After
preparing the wage sheet, they should be checked by another person.
Precautions: The person who checks the wage sheets should see that
- No fake names are included in the sheet,
- Wage rates are not overstated or deductions are not understated,
- Over time wages are calculated correctly and
- Wages are paid only to the person concerned.
Payment of Wages:
On the wage day, wage sheets are passed over to the cashier who with draws the necessary amount form the bank for payment of wages. The cashier should take the following precautions-
No person associated with the preparation of wage sheet should take part in payment of wages. As far as possible, pay -pocket should be prepared for each worker. Payment of wages should be made only to the worker concerned.
Foreman of the department should be present at the time of payment of wages to avoid impersonation of workers who are absent on that day.
Workers who are absent may collect their wages next day or any other person may collect any body’s pay pocket on the basis of a letter of authority duly authorized and attested by the worker.