Minimum Wage Legislation and Equal Wage Legislation

8/6/2019 Minimum Wage Legislation and Equal Wage Legislation

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MINIMUM WAGES ACT, 1948

Introduction:

The Minimum Wages Act was passed in 1948 and it came

into force on 15th March, 1948.

What the Minimum Wages Act purports to achieve is to

prevent exploitation of labour and for that purpose

empowers the appropriate Government to take steps to

prescribe minimum rates of wages in scheduledindustries.

According to its preamble the Minimum Wages Act, 1948,

is an Act to provide for fixing minimum rates of wages in

certain employments. The employments are those which


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are included in the schedule and are referred to as

Scheduled Employments.

The Act extends to whole of India.

Objectives

1. Prevention of extra hard work and toil and poverty

arising from unduly low wages.

2.Fixation of just and fair wages for preventing

industrial disputes.

3. Control of inflationary pressure.

4. Raising purchasing power with a view to speeding

up the pace of economic recovery.

5. Wage regulation as a part of national-income

distribution policy and programmes of planned

economic development

Important Definitions:

1. Appropriate Government [section 2(b)]

2. Employee [section 2(i)]

3. Employer [section 2(e)]

4. Scheduled employment [section 2(g)]

5. Wages [section 2(h)]


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Fixation of Minimum Rates of Wages [section 3(1)

(a)]

Section 3 lays down that the Appropriate Government

shall fix the minimum rates of wages, payable toemployees in an employment specified in Part I and Part II

of the scheduled, and in an employment added to either

part by notification under Section 27. In case of the

employment specified in Part II of the schedule, the

minimum rates of wages may not be fixed for the entire

state. Parts of the state may be left out altogether. In

case of an employment specified in Part I, the minimum

rates of wages must be fixed for the entire state, no partsof the state being omitted. The rates to be fixed need not

be uniform. Different rates can be fixed for different zones

or localities.

Notwithstanding the provision of Section 3(1)(a), the

appropriate Government may not fix minimum rates of

wages in respect of any scheduled employment in which

less than 1000 employees in the whole State are engaged.

But when it comes to its knowledge after a finding thatthis number has increased to 1000 or more in such

employment, it shall fix the minimum wage rate.

Revision of Minimum Wages [section 3(1)(b)]

According to section 3(1)(b), the Appropriate

Government may review at such intervals as it may thing

fit, such intervals, not exceeding Five years, and revise

the minimum rate of wages, if necessary. This means thatminimum wage can be revised earlier than Five years also.

Manner of Fixation/Revision of Minimum Wages


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According to section 3(2), the Appropriate Government

may fix minimum rate of wages for:

(a) Time work, known as a Minimum Time Rate

(b) Piece work, known as Minimum Piece Rate

(c) A Guaranteed Time Rate for those employed in

Piece work for the purpose if securing to such

employees a minimum rate of wages on a time work

basis

(d) A Over Time Rate i.e. minimum rate whether a

time rate or a piece rate to apply in substitution for

the minimum rate which would otherwise beapplicable in respect of overtime work done by

employee.

Section 3(3) provides that different minimum rates of

wages may be fixed for

(i) Different scheduled employments;

(ii) Different classes of work in the same scheduled

employments;

(iii) Adults, adolescents, children and apprentices;

(iv) Different localities

Further, minimum of wages may be fixed by anyone or

more of the following wage periods, namely:

(i) By the Hour,

(ii) By the Day,

(iii) By the Month, or

(iv) By such other large wage periods as may be

prescribed


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Minimum Rate of Wages [section 4]

According to section 4 of the Act, any minimum rate of

wages fixed or revised by the appropriate government

under section 3 may consist of

(i) A basic rate of wages and a special allowances ata rate to be adjusted, at such intervals and in

such manner as the appropriate government may

direct to accord as nearly by as practicable with

variation in the cost of living Index number

applicable to such workers; or

(ii) A basic rate of wages or without the cost of living

allowance and the cash value of the concession in

respect of supplies of essential commodities atconcessional rate where so authorized; or

(iii) An all inclusive rate allowing for the basic rate,

the cost of living allowance and the cash value of

the concession, if any.

The cost of living allowances and the cash value of the

concessions in respect of supplies essential commodities

at concessional rates shall be computed by the competentauthority at such intervals and in accordance with such

directions specified or given by the appropriate

government.


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Procedure for Fixing Minimum Rates of

Wages (Sec. 5)

For fixing minimum rates of wages either first time or in

revising appropriate Government is required to take eitherof following 2 actions:-

Appointment of committees and sub-committees

considered to be necessary for holding inquires and

advise government for fixation or revision

By notification in Official Gazette, publishing own its

proposals for the information of persons likely to be

affected thereby and specify a date not less than 2

months from the date of notification for considering

such proposals.

Minimum rates of wages so considered after considering

either of these 2 procedures are to come into force on the

expiry of 2 months from the date of notification, unless

the notification specifies any other particular date.

Advisory Board (Sec. 7)

For the purpose of coordinating work of committees and

sub-committees formed under sec. 5 appropriate

Government may appoint an Advisory Board for fixing and

revising minimum rates of wages.

Central Advisory Board (Sec. 8)

For advising Central and State Government in the mattersof fixation and revision of minimum rates of wages and

other matters under this Act and for coordinating the

work of the Advisory Boards, the Central Government shall

appoint Central Advisory Boards.


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Composition of Committees and Sub-

committees (Sec. 9)

While formation of any committees or sub-committees

(prescribed under sec. 5) number of employers &

employees in the scheduled employment should be equal

in number and an independent persons not exceeding 1/3rd

of the total number of members. Also, one of such

independent members is to be appointed the chairman by

the appropriate government.

Correction of Errors (Sec. 10)

Any error whether clerical or/and arithmetical in any

order fixing or revising minimum rate of wages if

occurs then appropriate Government can rectify it byissuing notification in Official Gazette.

Each such notification should be brought under notice

of Advisory Board for information

Wages in Kind (Sec. 11)

Wages in Kind means compensation made in any other

form than cash.

Minimum wages payable under this Act shall be paid

in cash.

Where it has been the custom to pay wages wholly or

partly in kind the appropriate government being of


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the opinion that it is necessary in the circumstances

of the case may by notification in the Official Gazette

authorize the payment of minimum wages either

wholly or partly in kind

If appropriate government is of the opinion thatprovision should be made for the supply of essentialcommodities at concession rates the appropriategovernment may by notification in the Official Gazetteauthorize the provision of such supplies atconcessional rates.

The cash value of wages in kind and of concessions inrespect of supplies of essential commodities atconcession rates authorized under sub-sec. (2) and(3) shall be estimated in the prescribed manner.

Payment of Minimum Rate of Wages (Sec. 12)

Employers are required to pay minimum rate of wagesfixed by Government without any deductions exceptthose authorized to every employee engaged in

scheduled employment. Nothing contained in this section shall affect the

provisions of the Payment of Wages Act 1936 (4 of1936).


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Payments of Minimum Rates of wages and

deductions from Wages:

Employees engaged in scheduled employment are to

be paid wages at fixed rate without any deductionsexcept those authorized [Sec.12].

Payment of Wages Act, 1936 to Scheduled

Employments:

Both governments are empowered to direct by

notification in the official gazettes the application of all

or any of the provision of the Payment of Wages Act,

1936 with or without modification to wages payable toemployees as specified in the notification [Sec.25F].

Hours of works, Overtime and Weekly Rest:

Both governments fix normal hours of working for a

working day including one or more intervals, rest and

remuneration with respect to the day of rest in respect of

scheduled employments.

-Employees engaged on urgent work, or in any

emergency which could not have been prevented;

-Work in nature of preparatory or complimentary work

which must necessarily be carried on outside the limits

laid down for the general working in the employment;

-Employment is essentially intermittent;

-work which for technical reasons has to be completedbefore duty is over;

-work which could not be carried on except at times

dependent on the irregular actions of the natural forces;


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In the case his unwillingness to work; he is not

entitled to receive wages for a full normal day [Secs.13-

16].

Miscellaneous Provisions

Claims:

As per the act Authority must be,

The Commissioner for Workmens Compensation, TheGovernment officer of the central government exercising

functions as a Labour Commissioner or officer not below

the rank of Labour Commissioner, the officer with the

experience as a Judge a Civil Court. And all are

empowered to hear and decide all claims arising out of

payments of wages less than minimum rates of wages.

Every such Authority is vested with the powers of a

Civil Court under the code of Civil Procedure 1898[Secs.20-21] for taking evidence and enforcing the

attendance of witnesses and compelling the production

of documents.

An application for a claim may be submitted by,

Employee himself, any official of a registered trade

union authorized by the employee to act on his behalf,

any inspector, and any person acting with the permissionof the Authority.

Application is to be made within 6 months. After that

it may also be entertained if he gives particular reason

for not making application within the period.


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-The Authority after hearing the application, direct

maximum compensation not exceeding ten times the

aggregate amount of the excess withheld by the

employer.

-If application is malicious, it may direct penalty not

exceeding fifty rupees be paid to the employer by the

presenter of the application.

Payments of Undisbursed Amounts Due to Employees:

If the amount payable to employee as minimum wages

under the act cannot be paid before the death ofemployee or not knowing whereabouts of employee is

deposited with the prescribed Authority [Sec.22D].

Protection against Attachment of Assets of Employer with

Government:

Any amount due to employer is deposited with the

Government to secure due performance of a contract is

not liable to attachment under any decree or order of any

court in respect of any debt incurred by the employer

other than any liability towards any employee in

connection with the aforesaid contract. [Sec.22E]

Exemption of employer from Liability in certain cases:

If an employer is charged with an offence under the

Act, he may make complaint that the actual offender is

any other person. He proves to the court that he used

due diligence to enforce the provisions of the Act, and

that the other person committed the offence without his

knowledge or consent, that other person is to be


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convicted of the offence and liable to like punishment as

if he were the employer [Sec.23].

Exemptions and Exception:

The central and state Government may direct thatthe provisions of the Act, whether partly or wholly, will

not apply to all or any class of employees employed in

any scheduled employment or any locality where a

scheduled employment is carried on. Scheduled

employment in a local area or to any establishment or a

part of any establishment in a scheduled employment, it

is not necessary to fix minimum wages in respect of such

employees of that class [Sec.26].

Contracting out:

An employee either relinquishes or reduces his right

to minimum rate of wages or any privilege or concession

according to him under the Act is null and void insofar as

it leads to a reduction of minimum rate of wages fixed

under this Act [Sec.25].

Registers and Records:

Every employer is required to maintain records of

employees, work performed by them, wages paid to

them, receipts given by them. The Government may

under rules provide for the issue of wage-book, wage-slips to employees employed under scheduled

employment in respect of minimum rates of wages have

been fixed and prescribed the manner in which entries

are to be made and authenticated in such wage-books by

the employer [Sec.18].


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Penalties and Procedures:

Payment is less than minimum rates fixed of wages

due to them under the Act or contravention of any rule

relating to hours for normal working days [Sec.13] ispunishable with imprisonment which may extend to 6

months or with fine which may extend Rs.500 or with

both [Sec22].

Contravention by the employer of any other provision

of the Act made under it is punishable with fine which

may extend up to Rs.500 [Sec.22A].

If the Claim is malicious, he may be punished with

fine not extending Rs.50 which is payable to employer

[Sec.24(4)].

Power of the Central and State Governments to make rules:

The central government is empowered to make rules

prescribing the term of office of the members the

procedures to be followed in the conduct of business, the

method of voting and the manner of filling up casual

vacancies in membership [Sec.29].

WORKING


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Schedule of the act & minimum wages for employees

contained only 13 categories of employment

( including agriculture)

The central govt. had added more than 30 categories

of mines in the schedule

Minimum wages(31-12-1993)

Karnataka 6.00(min. wage)

Maharashtra 64.44(max. wage)

Tripura 7(No. Of employments)

Orissa 79(No. Of employments)

Minimum wages(01-10-2001)

Maharashtra 8.64(min. wage)

West Bengal 165.78(max. wage)

Mizoram 3(No. Of employments)

Orissa 83(No. Of employments)


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Minimum wages in Gujarat

YEAR (No. Of

employment

s)

MIN. WAGE MAX. WAGE

1931 45 (9th ) 15 (14/25) 39.05(9/25)

2001 51 (10th ) 64.80(4/25) 95.40(7/25)

Minimum wages in Gujarat

YEAR (No. Of

employme

nts)

MIN.

WAGE

MAX.

WAGE

1931 40 19.82 37.37

2001 45 52 124.61

DIFFICULTIES

1) In organized industry workers are in receipt of

diff. Kinds of allowances and other benefits but in not

under scheduled employment

2) The enforcement of the act has been a very

difficult task from the beginning & so many

irregularities are there such as


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1985 6 lacs

(only by the

office of chief

labour

commissioner)

1992 45 thousand

1993 44 thousand

1994 1 lac1996 1.33 lacs

1997 1.31 lacs

1998 1.4 lacs

1999 1.5 lacs

2000 1.8 lacs

During 1992-96 lacs of irregularities detected

and rectified in the state BIHAR.

AN APPRAISAL


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The act was related to do something new and

revolutionary & based on philosophy that

WAGES CANT BE DETERMINED ENTIRELY BY

MARKET FORCESBut there are certain deficiencies in legislation and in

implementation.

1) THERE IS NO CRITERIA WHICH WILL GUIDE GOVT.

& MINIMUM WAGES COMMITTES IN THE FIXATION OF

MINIMUM WAGES

Same job-same location-diff. wages

In India concept on minimum wages is given by THE

FAIR WAGES COMMITTE and 15TH SESSION OF INDIAN

LABOUR CONFERENCE & they believe that WAGES

SHOLD NOT BE PROVEDED ONLY FOR SUSTAINANCE OF

LIFE BUT ASO FOR EDUCATION MEDICAL REQIRMENTS

& AMENITIES

15TH SESSION OF INDIAN LABOUR CONFERENCE has

introduced concept of NEED BASED MINIMUM WAGE

which includes food, clothing, housing, and other

expenses of workers and their families.

But in some cases because of low rates, income

remains below than income needed for determination

of poverty line.


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2) The inclusion of agriculture in the schedule of

the act is very progressive step but it is beset with

numerous pit-falls and difficulties

IT is because of these handicaps that most of the state

govt. has not been wholly successfully in fixing and

implementing minimum rates of wages for agricultural

operations.

Even where wages have been fixed, their payment in

many cases is far off from reality.

DIFFICULTIES RELATED TO AGRICULTURE IN INDIA

Immense scale wide area enormously large no. of

workers to be covered;

Large no. of small size of farmers who are

illiterate and have no past records;

Multilateral relationship between agricultural

employer and his employees;

3) The revision of minimum rates of wages has generally

not been regulated. According to minimum wage Act 1948

the provision of act should be prescribed at least once inevery 3 years.

4) The main objective of the act was prevention of

sweating, but now there is a case for deleting


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unemployment from the schedule of the act when

conditions of sweating no longer exist.

In spite of these deficiencies and the difficulties inenforcement, the act continues to lay down useful

minimum standard relating to rates of wages.


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Equal Remuneration Act, 1976

Applicability:

Applies to the whole of India

Duty of employer to pay Equal Remuneration

(Section 4)

No employer shall pay to any worker, employed by

him in an establishment or employment,

remuneration, whether payable in cash or in kind, at

rates less favorable than those at which remunerationis paid by him to the workers of the opposite sex in

such establishment or employment for performing the

same work or work of a similar nature.

No employer shall, for the purpose of complying with

the provisions of sub-section (1), reduce the rate of

remuneration of any worker.

Where, in an establishment or employment, the rates

of remuneration payable before the commencement

of this Act for men and women workers for the same

work or work of a similar nature are different only on

the ground of sex, then the higher (in cases where

there are only two rates), or, as the case may be, thehighest (in cases where there are only two rates), of

such rates shall be the rate at which remuneration

shall be payable, on and from such commencement,

to such men and women workers: Provided that

nothing in this sub-section shall be deemed to entitle


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a worker to the revision of the rate of remuneration

payable to him or her with reference to the service

rendered by him or her before the commencement of

this Act.

Prohibition of Discrimination in recruitment or

other conditions of services (Section 5)

On and from the commencement of this Act, no

employer shall, while making recruitment for the

same work or work of a similar nature, 2[or in any

condition of service subsequent to recruitment such

as promotions, training or transfer], make any

discrimination against women except where the

employment of women in such work is prohibited or

restrictedly or under any law for the time being in

force.

Provided that the provisions of this section shall not

affect any priority or reservation for scheduled castes

or scheduled tribes, ex-servicemen, retrenched

employees of any other class or category of persons

in the matter of recruitment to the posts in and

establishment or employment.

Advisory Committee (Section 6)


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For the purpose of providing increasing employment

opportunities for women, the appropriate

Government shall constitute one or more Advisory

Committees to advise it with regard to the extent to

which women may be employed in suchestablishments or employments as the Central

Government may, by notification, specify in this

behalf.

Every Advisory Committee shall consist of not less

than ten persons, to be nominated by the appropriate

Government, of which one-half shall be women.

In tendering its advice, the Advisory Committee shall

have regard to the number of women employed in the

concerned establishment or employment, the nature

of work, hours of work, suitability of women for

employment, as the case may be, the need for

providing increasing employment opportunities forwomen, including part-time employment, and such

other relevant factors as the Committee may think fit.

The Advisory Committee shall regulate its own

procedure.

The appropriate Government may, after considering

the advice tendered to it by the Advisory Committee

and after giving to the persons concerned in the


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establishment or employment an opportunity to make

representations, issue such directions in respect of

employment of women workers, as the appropriate

Government may think fit.

Power of appropriate Government to appoint

authorities for hearing and deciding claims and

complaints (Section 7)

The appropriate Government may, by notification,

appoint such officers, not below the rank of a Labour

Officer, as it thinks fit to be the authorities for thepurpose of hearing and deciding

(a) Complaints with regard to the contravention of

any provision of this Act

(b) claims arising out of non-payment of wages at

equal rates to men and women workers for the

same work or work of a similar nature, and may, by

the same or subsequent notification, define thelocal limits within which each, such authority shall

exercise its jurisdiction.

Every complaint or claim referred to in sub-

section (1) shall be made in such manner as may be

prescribed.

If any question arises as to whether two or more

works are of the same nature or of a similar nature, itshall be decided by the authority appointed.

Where a complaint or claim is made to the authority

appointed it may, after giving the applicant and the


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employer an opportunity of being heard, and after

such inquiry as it may consider necessary, direct,

(i) In the case of a claim arising out of a non-payment

of wages at equal rates to men and women workers

for the same work or work of a similar nature, that

payment be made to the worker of the amount by

which the wages payable to him exceed the amount

actually paid

(ii) in the case of complaint, that adequate steps be

taken by the employer so as to ensure that there is

no contravention of any provision of this Act.

Every authority appointed shall have all the powers

of a Civil Court under the Code of Civil Procedure,

1908 (5 of 1908), for the purpose of taking evidence

and of enforcing the attendance of witnesses and

compelling the production of documents.

Any employer or worker aggrieved by any order

made by an authority appointed, on a complaint or

claim may, within thirty days from the date of the

order, prefer an appeal to such authority as the

appropriate Government may, by notification, specify

in this behalf, and that authority may, after hearing

the appeal, confirm, modify or reverse the order

appealed against and no further appeal shall lie

against the order made by such authority.


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MAINTAINANCE OF REGISTER

As per Sec (8) every employer is required to maintain a

proper register in regards to the employees.

INSPECTORS

He has no entry barriers in factory premises.

He can any time check the register and documents of

employer.

To see whether the workers are complying with the

acts or not.

He can take extracts from registers also for hisreference(sec.9)

PENALTIES

Following are the situations considered to be offensive

This situation is punishable with simple imprisonment for

a term may be extended to a month or a fine of 10,000 or

both,

Failure in maintaining registers relating to

employees.


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Failure in producing the same when demanded.

Refusal or omission of the employer to give evidence

or preventing his worker in charge of establishment.

Refusal to give any information.

The other following offenses are punishable with fine not

less than 10,000 but not more than 20,000 or with

imprisonment of not less than 3 months but not more than

one year or both for first time and it may extend to 2

years for second time,

Making any recruitment in contravention of the act.

Making differential payment to men and women for

same work and of same nature.

Making any discrimination between men and women

in contravention of the provision of act.

Failing to carry out any direction made by the

appropriate Govt. in regards to prohibition of

discrimination in recruitment of men and women.

COGNIZANCE AND TRIAL OFFENCES

OTHER PROVISIONS

Power to make rules


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Power of central Govt. to give direction.

AN ASSESSMENT

THANKYOU

Minimum Wage Legislation and Equal Wage Legislation

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