Labour Compliance

What is the Minimum Wage Under the Minimum Wages Act of 1948?

The minimum wages act of 1948 lays down the minimum amount an organisation has to pay a particular employee for a specific job that any collective agreement or contract agreement cannot define. The Minimum Wages Act was first implemented in 1948 and took effect on 15th March. The Act also created the “Tripartite Committee” of a fair wage at the national and state levels to determine and revise minimum wage rates for different industries and occupations. The committee is responsible for considering factors such as cost of living, inflation and other relevant factors in determining minimum wages. The committee was created to set the minimum wage guidelines in India. It addresses labour-related issues, such as working conditions and dispute resolution. The Ministry of Labour and Employment plays a crucial role in coordinating and facilitating the work of these committees. It set the foundation for the wage fixation process in India. The salary levels are determined based on the number of employees.

Purpose

The Minimum wage Act of 1948 is essential to ensure a decent living for a worker and prevent employee exploitation. The Act provides that the State/ Central Government fix the minimum wage rate and revise it every five years. The Government implemented the guidelines for the workers as soon as possible.

• The Act was introduced in the year 1948, and it was amended in 2000;
• The changes included a change in the floor level of minimum wages for the workers;
• Currently, the minimum wage floor in India is Rs.185/- per day, but the law also gives certain exceptions for certain employees ;
• The lowest floors are to be found in Andhra Pradesh, Kerala, and Gujarat

Further, the new law provides higher minimum wages for workers with disabilities;

• The Act requires the Government to consult with the committee and the people’s representatives affected by the minimum wage.
• The committee determines the minimum wage rate of the Act
• The Government must publish it in the newspapers and enforce it within three months from the publication date.

Objective

It accommodates fixing wage rates for any industry.

1) While fixing hours for an ordinary working day, it is required to comply with the guidelines provided;

• The hours to be fixed for an ordinary working day should have at least one break.
• One three-day weekend from a whole week was given to the representative for rest.

2) If a representative is engaged with work that classifies his service and should be given at least two booked vocations, the worker’s pay incorporates a particular compensation pace of all work for the number of hours devoted to each undertaking.

3) The business must record all workers’ wages, work and receipts.

4) Appropriate legislatures will review the work and choose examiners for the equivalent.

Fixation and revision of minimum wages for workers

• The minimum wages Act of 1948 is an important legislation in India that ensures workers receive a minimum wage. The Act sets guidelines for the fixation and revision of minimum wages for workers in various industries and occupations.
• Under the Act, the appropriate Gov. (central or state) is responsible for fixing and revising minimum wages for workers in scheduled employment. Scheduled employments refer to industries and occupations that are listed in the Act.
• To fix or revise minimum wages, the appropriate Gov.( central or state) must consider various factors such as the cost of living, the level of skill required for the job, and the prevailing rates of wages in similar industries and occupations. The Gov. may also consider the workers’ productivity and the employer’s profits.
• Once the minimum wages are fixed or revised, they must be published in the official gazette and enforced by the concerned authorities. Employers must pay their workers at least the minimum wages prescribed by the Gov.
• Overall, the fixation and revision of minimum wages under the Act are essential to ensure fair wages for workers and protect them from exploitation.

Procedure

The procedure before the authority in matters relating to non-payment or payment of less than the minimum wages to the employees occurred in the following manner;

• The prescribed authority gives adequate opportunities of being heard to the applicant, employer or any other person.
• In case of delay or non-payment of wages, the authority has directed the refund of such amount to the applicant or the employee of the amount delayed or unpaid, along with the compensation for the damages suffered by the employee or the applicant.
• No compensation is awarded to the employee if the authority is satisfied that the delay in payment of wages of the employee was a bonafide error. The authorised person could not make the payment even though they exercised due diligence.

Penalties

Section 22 of the Wages Act, 1948^[1], an employer who fails to provide minimum rates of wages to the employees or the workers any order or rule made under section 13 of the Act shall be punished with imprisonment for a term which may extend to six months or not less than five hundred rupees or both.

Conclusion

The Minimum Wages Act of 1948 was enacted to safeguard the rights and interests of the workers as laid down under the Act. The Act provides equal employment opportunities and adequate remuneration for maintaining a decent standard of livelihood for the workers. The provisions under the Act also state revising wages every five years, fixing working hours on a typical working day and preventing undue exploitation of the workers in the establishment. The Act further states that the advisory committees and boards that the workers can approach seek redressal regarding cases concerning the delay in the payment or non-payment of wages by their employers. The Act also grants adequate powers to the inspectors to look after the welfare of the workers. Therefore, this Act plays a crucial role in providing the basic needs of the workers of a scheduled employment category, granting adequate wages to survive with their livelihood and promoting the Directive Principles of State Policy under Article 43 of the Constitution of India.

Also Read: Key Highlights of New Labour Codes in India