4.

Wage Boards have taken a narrow view of their problems and have over looked the wider effects of their recommendations. Discuss Wage Board is one of the important institutions set up by the Government of India for fixation and revision of wages. Separate wage boards are set up for separate industries. Government of India started instituting Wage Boards in accordance with the recommendations of Second Five Year Plan, which were reiterated by the Third Five Year Plan. Wage boards are not governed by any legislation but are appointed on adhoc basis by the Government. In the 1950s and 1960s, when the organized labour sector was at a nascent stage of its development without adequate unionization or with trade unions, without adequate bargaining power, the Government of India, in appreciation of the problems which arise in the arena of wage fixation due to absence of such bargaining power, constituted various Wage Boards. The Wage Boards are tripartite in character in which representative of workers, employers, independent members participate and finalize the recommendation. The Wage Boards for journalists and non-journalist newspaper and news-agency employees are statutory in nature. The representatives of the former two interests are nominated by their central organizations; the government nominates others. It is important machinery of state regulation of wages. The main objectives of the state regulation of wages have been: a. Prevention of sweating in industries with illiterate and unorganized workers; b. Promoting industrial peace; c. Speeding up the pace of economic recovery; d. Preventing inflationary pressure and maintaining economic stability; e. Facilitating the achievement of the national income distribution policy and the programme of economic development; and f. Narrowing down of the gap existing between the marginal productivity of labour and the actual level of wages as the average. COMPOSITION OF WAGE BOARD The composition of wage boards, as a rule, tripartite represents the interest of labour, management and the public. Labour and management representatives are nominated in equal numbers by the government, with consultation and consent of the major central organizations. Generally, the labour and management representatives are selected from the particular industry being investigated. Government nominated members representing the public chairs these boards. Each Wage Board consists of one neutral chairman, two independent members and two or three representatives of workers and management each. The wage boards have to study various factors before making its recommendations. The recommendations of the Wage Boards are first referred to the Government for its acceptance. The Government may accept with or without modification or reject the recommendations of the Wage Board. The recommendations accepted by the Government are enforceable by the parties concerned. The wage boards take the following factors into consideration for fixing or revising the wages in various industries. 1. Job evaluation

2. 3. 4. 5. 6. 7.

Wage rates for similar jobs in comparable industries. Employees productivity. Firms ability to pay. Various wage legislations. Existing level of wage differentials and their desirability. Governments objectives regarding social justice, social equality, economic justice and economic equality. 8. Place of the industry in the economy and the society of the country and the regional. 9. Need for incentives, improvement in productivity etc. The wage boards fix and revise various components of wages like basic pay, dearness allowance, incentive earnings, overtime pay, house rent allowance and all other allowances. FUNCTIONS OF WAGE BOARD The Wage Boards are required to: a. Determine which categories of employees are to be brought within the scope of the wage fixation. b. To work out a wage structure based on principles of Fair Wages; c. The system of payment by results; d. To work out the principles that should govern of bonus to workers in respective industries; In evolving a wage structure, the board takes into account these facts; a. The need of the industry is a developing economy including the need for maintaining and promoting exports; b. The requirements of social justice which states that the sufficient at least to be able to sustain himself and his family in a reasonable degree of comfort, ad that his is not exploited; c. The need for adjusting wage differentials (which is in relation to occupational differentials; inter-firm differentials; regional or inter-area differentials; inter-industry differentials and differentials based on sex) in such a manner as to provide incentives to workers for advancing their skill. WORKING OF THE WAGE BOARDS Prior to the advent of Wage Boards, the Tribunals set up under the Industrial Disputes Act played a significant role in the resolution of wage disputes. But it was soon realized that in the organized industries, the number or frequency of wage disputes could not be reduced unless the parties themselves were given a more responsible role in reaching decisions. The desire for granting greater role to the parties to resolve disputes on wages themselves found its first positive expression in the Second Five-year Plan which recommended the establishment of wage boards on an industry-wide basis. In pursuance of the recommendations of the Second Plan which were further reiterated by the Third Plan, a large number of Tripartite Wage Boards have come to be established in different industries during all these years. It should be noted that there is no law in India providing for the

establishment of these Boards. These are appointed b y the Government of India purely on an adhoc basis on the demand of trade unions and employers. Although the Wage Boards are set up by the government, the basic reason for their establishment is the pressure brought about by the trade unions, industrial federations and national centres on the one hand, and the employers formal or informal consent on the other. The demands for the wage boards backed either by threatened or actual strikes. Pressure has been used in the case of appointment of wage boards for jute industry by jute workers association and for coal mining industry by the trade union. The formation of wage boards in other industries has been the result of similar demands and pressures on the part of the trade unions. Such as plantations, iron and steel, engineering, sugar and Electricity. The functioning of the board comprises three steps, namely, (i) To prepare comprehensive questionnaire designed to collect information on prevailing wage rates and skill differentials, means of assessing an industrys paying capacity, most desirable methods of measuring worker capacity and work leads, prospects for industry in immediate future, and regional variations in the prices of widely consumed consumer goods. The questionnaires are sent out to labour unions, employer associations, interested individuals, academic organizations and government agencies; (ii) To give public hearing in which leaders of labour unions and employers associations, not represented on the board, as well as others interested in industry in question are given a verbal or oral bearing on issues dealing with wages, working conditions and other items; (iii) To convene secret sessions in which members of the board make proposals and counter proposals regarding the items covered under the terms of reference. GROWTH AND DEVELOPMENT OF WAGE BOARDS The history of Wage Boards in India dates back to the 1930s. The Royal Commission of Labour recommended the setting up of tripartite boards in Indian industries. It said Wage Boards are also known as Trade Boards, Wage Council, Wage Committees, Wage Commissions, etc. We could call attention to certain cardinal points in the setting up of (wage-fixing) machinery of this king. The main principle is the association of representatives of both employers and workers in the constitution of the machinery. Such representatives would be included in equal members, with an independent element chosen as far as possible in agreement with or, after consultation with, the representatives of both parties. But then British Government did not accept the recommendation. After Independence, the industrial disputes act was enacted under which disputes regarding wages could be settled through adjudication. But the parties were not satisfied with this system. The idea of setting up the tripartite Wage Boards was therefore, mooted and endorsed in first Plan. It stated: Permanent wage boards with a tripartite composition should be set up in each state and the centre to dale comprehensively with all aspects of the question of wages; to intimate necessary enquiries, collect data, review the situation from time to time and take

decisions regarding wage adjustments us motu or on reference from parties or from the government. No action was taken during that plan period. However, the second plan emphasized the need to determine wage through industrial wage boards. It observed: The existing machinery for settlement of wage disputes has not given full satisfaction to the parties concerned. A more acceptable machinery for setting wage disputes will be one which gives the parties themselves a more responsible role in reaching decisions. An authority like a tripartite wage board, consisting of equal representatives of employers and workers and an independent chair will probably ensure more acceptable decisions. Such wage boards would be instituted for individual industries in different areas. In India the Bombay Industrial Relations (Amendment) Act of 1948 may be regarded as the pioneer making provision for the establishment of wage boards in any industry covered by the act. Accordingly, the first wage board was set up on Bombay for the cotton textile industry. The principal purpose of starting wage boards was to relieve the industrial courts and labour courts of a part of their adjudication work. The amending act of 1953 has tried to avoid multiplicity of proceedings under the act. It empowered the industrial courts, labour courts and the wage boards to decide all matters connected with or arising out of any industrial matter or disputes. INDUSTRIES COVERED The first non-statutory wage board was set up for the cotton textile and sugar industry in 1957. Since then 24 wage boards covering most of the major industries have been set up by the centre: cotton textiles, sugar, cement, working journalists and non-working journalists (twice each), jute, tea, coffee and rubber plantations, iron ore, coal mining, iron and steel, engineering, heavy chemicals and fertilizers, electricity undertakings, road transportation, ports and docks, leather and leather goods, lime stone and dolomite. This recommendation was subsequently reiterated by the 15th Indian Labour Conference in 1957 and various industrial committees. The government decision to set up the first wage board in cotton textile and sugar industries in 1957 was also influenced by the Report of I.L.O.s expert. The importance of the non-statutory Wage Boards has consequently declined over a period of time and no non-statutory Wage Board has been set up after 1966, except for sugar industry, where last such Wage Board was constituted in 1985. The trade unions, having grown in strength in these industries, are themselves able to negotiate their wages with the management. This trend is likely to continue in future. The Working Journalists and other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955 (45 of 1955) (in short, the Act) provides for regulation of conditions of service of working journalists and non-journalists newspaper employees. The Section 9 and 13 C of the Act, inter-alla, provide for constitution of two Wage Boards for fixing or revising rates of wages in respect of working journalists and non-journalists newspaper employees, respectively. The Central Government shall, as and when necessary, constitute Wage Boards, which shall consist of

(a) Three persons representing employers in relation to Newspaper Establishments; (b) Three persons representing working journalists for Wage Board under Section 9 and three persons representing non-Journalist newspaper employees for Wage Board under Section 13 C of the Act. (c) Four independent persons, one of whom shall be a person who is, or has been a judge of High court or the Supreme court, and who shall be appointed by the Government as the Chairman thereof. Since 1955, the government has constituted 5 wage boards at regular intervals for the working journalists and non-journalist newspaper employees. The following table gives the details of the constitution of wage boards and other relevant details: Constitution of Wage Boards for Working Journalists and Non-Journalists Newspaper Employees in the Past
S. No. Name of the Wage Board Date of appointment of the Wage Board 02-05-1956 12-11-1963 Date on which final report was submitted to the Government NA 17-07-1967 Date of acceptance of the recommendation by the government Remarks

I II

III

IV

Wage Board for Working Journalists (a) Wage Board for Working Journalists (b) Wage Board for Non-Journalist Newspaper Employees (a) Wage Board for Working Journalists (b) Wage Board for Non-Journalist Newspaper Employees Wage Boards for Working Journalists and Non-Journalist Newspaper Employees Wage Boards for working Journalists and Non-Journalist Newspaper Employees

10-05-1957 27-10-1967

25-02-1964

17-07-1967

18-11-1967

11-06-1975

13-08-1980

26-12-1980

06-02-1976

19-08-1980

20-07-1981

17-07-1985

30-05-1989

31-08-1989

Converted into one man Tribunals on 9th February, 1979. -

02-09-1994

25-07-2000

05-12-2000 And 15-12.2000

The last Wage Board, namely the Manisana Wage Board, was set up on 02 September 1994, which submitted its report to the Government on 25 July 2000. The Government accepted the recommendations of the Manisana Wage Board, and notified the same for implementation with

minor modifications, vide notifications dated 05.12.2000 and 15.12.2000. the prime responsibility for implementing the recommendations of the Wage Board rests with the concerned State Governments / Union Territories under the provision of the Act. The newspaper employees unions have been demanding constitution of fresh Wage Boards as more than 10 years have elapsed after the constitution of last Wage Board and they felt the last Wage Boards had not taken into consideration the boom in the newspaper sector on account of globalization and liberalization. Although the Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provision Act, 1955 does not say anything about the periodicity of constitution of Wage Boards, it was felt that the time was ripe for constitution of fresh Wage Boards as more than 10 years have elapsed since the last Wage Boards were constituted. The Cabinet in its meeting held on 18.12.2006 approved the proposal for constitution of two Wage Boards, one for working journalists and another one for non-journalist newspaper employees, under Sections 9 and 13 C of the Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955. The Wage Boards have been given 3 years to submit their reports to the Government. The present Wage Boards have been constituted vide Notification No.V-24040/3/2004-WB dated 24th May, 2007 under the Chairmanship of Dr. Justice K. Narayana Kurup, formerly Judge High court of Kerala and Acting Chief Justice High court of Madras. Sh. K.M. Sahni, former Secretary, Ministry of Labour and Employment has been appointed as full-time MemberSecretary of the Wage Boards. The Wage Boards have started functioning from Delhi. The Composition of the two Wage Boards is indicated in the relevant notifications. PROBLEMS OF WAGE BOARDS The committee set up by the National Commission on Labour identified three major problems from which the wage boards suffer; 1. Majority of the recommendations of the wage boards are no unanimous. 2. The time taken by the wage boards to complete their task has been rather unduly long; and\ 3. Implementation of the recommendations of the wage boards has been difficult. ASSESSMENT OF WAGE BOARDS Wage boards take their own time in the submission of reports. E.g., the second wage board in cement and the first wage board on cotton textiles and sugar took a little less than 3 years; while wage board on coal mining, non journalists, jute, iron and steel took a little over 3 years; that on tea plantations took 5 years and on coffee plantation 4 years; and iron ore mining 5 years. Some of the wage boards constituted in 1964 did not submit reports even by 1969, e.g., heavy chemicals, fertilizers, engineering industries, ports and docks. The average time taken by wage boards in the finalization of their deliberation varies from 3 years to 5 years. The main reasons account for delay in the completion of wage boards work have been:

(i) Routine delays in the recruitment of staff preparation and printing of questionnaires; (ii) Getting replies to questionnaires; (iii)Time involved in public hearings; and (iv) Lack of accord among members in arriving at a decision; The boards have been successful in fulfilling their primary object of promoting industry-wise negotiations and active participation by the parties in the determination of wages and other conditions of employment.