Telangana Bans Cash Wage Payments and Extends Minimum Wage to Gig Workers

The Telangana government has officially implemented a comprehensive overhaul of its minimum wage rules, banning cash wage payments and bringing gig workers under the minimum wage net. The new regulations, issued under Government Order GO.MS 6 on May 30, came into effect across Telangana on Monday, June 1, activating provisions of the Centre's Code on Wages, 2019.

Under the new rules, payouts in physical cash are strictly prohibited. Employers are now mandated to disburse all wages through direct electronic transfers—such as NEFT, RTGS, or IMPS—or via bank checks. This change is designed to create an unalterable digital trail for labor inspectors to protect vulnerable workgroups.

The order also introduces mandatory paid weekly rest days, ensuring workers do not lose income for taking Sundays off. Additionally, any work performed beyond the standard eight-hour daily shift, or requested on public holidays and weekly rest days, must now be compensated as overtime at double the standard wage rate.

For the first time, Telangana has extended minimum wage protections to gig and platform workers, specifically naming those in eCommerce, courier services, and LPG distribution. The state has also recognized specialized roles like drone technology pesticide sprayers under the "Highly Skilled" category to secure premium wages.

To simplify compliance, the order categorizes all non-agricultural, commercial, and industrial setups into four skill categories: unskilled, semi-skilled, skilled, and highly skilled. The state has been divided into three geographical zones to determine rates.

In Zone 1, which covers Municipal Corporations, minimum wages have been increased. Unskilled workers will see their minimum wage rise from Rs 12,750 to Rs 16,000. Semi-skilled wages will increase from Rs 13,152 to Rs 17,000. Skilled workers will see an increase from Rs 13,772 to Rs 18,500, while highly skilled workers will receive a minimum of Rs 20,000, up from Rs 14,607.

The new guidelines also establish absolute gender neutrality, requiring uniform minimum wage rates for male, female, transgender, and physically challenged employees performing identical work. Furthermore, to close subcontracting loopholes, the principal employer will be held directly liable for payroll settlement if a third-party agency fails to deliver wages.