Minimum Wages For States Across India – Changes in the last 3 months July – September – October 2021.
Fixing of minimum rates of wages
The appropriate Government may fix the minimum rates of wages payable to employees employed in an employment specified in Part – I or Part – II of the Schedule and in an employment subsequently added to the Schedule. The Government may review the minimum rates of wages and revise the minimum rates at intervals not exceeding five years.
The appropriate Government may fix separate minimum rates of wages for time rate and for piece rate. Different wage rates may be fixed for different scheduled employments, different classes of work in the same scheduled employment, for adults, adolescents, children and apprentices and for different localities and for any one or more of the wage periods, viz., by the hour or by the day or by the month or by such larger wage period as may be prescribed.
Minimum rate of wages
Any minimum rate of wages fixed or revised may consist of
- a basic rate of wages and a special allowance ; or
- a basic rate of wages with or without cost of living allowance and the cash value of concessions in respect of supplies of essential commodities at concessional rates; or
- an all inclusive rate allowing for the basic rate, the cost of living allowance and the cash value of concessions, if any.
Procedure for fixing and revising minimum wages
The appropriate Government is required to appoint an Advisory Board for advising it, generally in the matter of fixing and revising minimum rates of wages.
The Central Government appoints a Central Advisory Board for the purpose of advising the Central and State Governments in the matters of the fixation and revision of minimum rates of wages as well as for co-ordinating the work of Advisory Boards.
The Central Advisory Board consists of persons to be nominated by the Central Government representing employers and employees in the scheduled employments, in equal number and independent persons not exceeding one third of its total number of members. One of such independent persons is to be appointed the Chairman of the Board by the Central Government.
Penalties for Offences
Under-payment and non-payment of Minimum Wage is deemed as an offence under the Central Act. The penalty may range from upto 5 years imprisonment and a fine of Rs. 10000/- (under Section 22 of the Act).
CODE ON WAGES, 2019
The Code on Wages, 2019 was enacted to amend and consolidate the laws relating to wages, bonus and matters incidental to the same. The code repeals 4 major labour law enactments –
- The Payment of Wages Act, 1936
- The Minimum Wages Act, 1948
- The Payment of Bonus Act, 1965
- The Equal Remuneration Act,1976
CHANGES MADE IN THE CODE ON WAGES, 2019
| Earlier provision | Latest Provision |
| 1. In an interval of 5 years, the state or the central government must revise the minimum wages. | The state or central government shall not exceed a period of five years for revision of minimum wages. |
| 2. The definition of the term ’employer’ includes any person who employs one or more persons at an establishment. | The definition of ’employers’ includes any person who directly or indirectly employs one or more persons at an establishment. |
| 3. The Code provides for a Central Advisory Board consisting of: (i) employers, (ii) employees in equal number as employers, and (iii) independent persons (not exceeding one-third of the total members). | The Code provides for a Central Advisory Board consisting of: (i) employers, (ii) employees in equal number as employers, (iii) independent persons (not exceeding one-third of the total members), and (iv) five representatives of state governments to be nominated by the central government. |
Current Trends
The economic reforms in India have improved the overall business environment through market oriented policies. With the implementation of various labour law reforms, India is certainly becoming an attractive destination for doing business. However, there are certain factors which are creating adverse conditions and lack of business friendly regulation and policies are undesirably, impacting business and preventing it from realizing its true potential.
Domestic regulations are viewed as excessive and burdensome. However, the Central Government and various State Governments are reforming their policies though the process of decision making which is a good sign seen today in the light of ease of doing business.
The reforms and new rules coming in, will bring in overall improvement over time and will remove multiplicity of procedures and clearances and renewals of various licenses , more so, at the State level.
The new set of rules shall empower the relationship between the employer, employee, the government and have a positive long-term impact on the industry and further contribute towards the idea of ease of doing business.
Reforms will make way for employee empowerment?
Employee empowerment is the ability to accomplish something , giving them the confidence needed to succeed. Companies which believe in empowering employees carry out the following initiatives :
- Give employees a voice by regularly soliciting and acting on their feedback.
- Provide opportunities for employees to grow by giving additional responsibilities, or even an entirely new role.
- Recognize employees frequently to increase their engagement and confidence in their own abilities.
- And, of course, provide employees with the tools, training, and authority they need to excel.
Reforms will make way for Motivated employees
Empowering employees has been directly linked to an increase in employee motivation.
Experts agree that employees who have more control over how, when, and where they do their job will work harder and find their work more engaging.
In this kind of an environment, employees will put their best foot forward and feel more satisfied at the end of the day.