EFFECTS OF THE

COMMENCEMENT OF THE
MINIMUM WAGES ACT,
1948

WORKERSINGARMENT

INDUSTRY

WORKERSINBUTTONINDUSTRY

PRESENTATION BY:
WORKERSINSTEELINDUSTRY

ASHUTOSH KUMAR(350)

MINIMUM WAGES ACT, 1948

Over the years, in a country like India, except certain highly organized industries,
the labour as a whole was not able to put a face of collective bargaining and look
after their own interests. Thus, Minimum Wages Act, 1948 was enacted in the
country with the OBJECTIVE:

To provide minimum wages to the workers working in

organized

sector(scheduled employment)

To stop exploitation of the workers

To empower the government to take steps for fixing minimum wages and to
revise this wages within a period of five years.

To provide for appointment of Advisory Committees & Advisory Boards,

having equal representatives of employers and workers.

APPLICABILITY OF THE ACT

The Act extends to whole of India.
To any employment in any State if it employs 1000
employees.
The Act will not apply to employees in any undertaking
owned by the Central Govt. or of Federal railway, except with
the consent of the Central Govt.
Thus, the wages have to be statutorily paid.

What is wages?
section 2(h)
Wages means all remuneration capable of being
expressed in terms of money. It includes house rent
allowance but does not include
value of house accommodation, supply of light, water,
medical attendance
Value of any other amenity provided, if excluded by
Government order
Contribution to pension fund or provident fund or
insurance
Traveling allowance
special expenses incurred by
the nature of employment
Gratuity payable on discharge.

Minimum Rate of wages (section 4)

Any minimum rate of wages fixed or revised by the
appropriate govt. may consist of,
a basic rate of wages and a special allowance at a rate to be
adjusted at such intervals and in such a manner as the govt.
may direct OR
A basic rate of wages with or without allowance for cost of
living allowance based on cost of living index number. OR
An all inclusive rate allowing for basic wage, cost of living
allowance and cash value of concession, if any

Procedure for fixation of min wages(sec.5)

1.

Committee method : a committee is appointed to hold

enquiry and suggest minimum wages to be fixed.

2.

Notification Method : notification is published in the

official gazette and 2 months period is given to
different parties to suggest their case. Based on the
representations, the govt. will fix the minimum wages.
The notification can apply from retrospective effect
also.

AUTHORITIES:
Advisory board
Government is required to constitute Advisory Board to recommend minimum
wages. The recommendations of Advisory Board are not binding on
Government.

Central Advisory Board

It is constituted from persons nominated by central government.

And consist of representatives of employers, employees and independent

members (up to 1/3rd of the total strength).

Are w orking hours fi

xed?

Sec. 13: the govt. may fix the hours of work. It

may provide for rest day and interval also.

W ill th ere b e overtim e?

Sec. 14: if minimum wages is fixed by

hours, then the workers will be paid
overtime if he works more than the
hours prescribed. The overtime rate
will
beorker
as fixed
in this
law
i
fa w
w orks
less
thor
another
n ormlaw
al
as
.
h
ouapplicable
rs
He will receive minimum wages
he will not receive minimum wages if
he is not willing to work or
circumstances as may be prescribed.

Employer to close the unit, if minimum wages

cannot be paid
If employer cannot pay minimum wages, he has to close down

the undertaking. Paying capacity is not relevant consideration

for rate of minimum wages.
Deepak Photos v. State of Kerala 2001

Minimum wages are payable irrespective of financial position

of individual employer Hindustan Aeronautics v. Workmen AIR
1967

If you pay more than minimum wages fair .

Even if State Government notification prescribes variable dearness allowance

which is linked with cost of living index, amount paid on basis of DA is not to
be taken as an independent component of minimum wages, but as part and
parcel of process of computing minimum wages. Hence, in cases where
employer is paying total sum which is higher than minimum rates of wages
fixed under the Act including the cost of living index (VDA), he is not required
to pay VDA separately.
Harilal Jechand Doshi v. Maharashtra General Kamgar Union 2000

RECENT INITIATIVES

Based on the recommendations of the Minimum Wages Advisory Board

(MWAB) in its meeting held on 22.01.2008 and 26.06.2008, the Ministry of
Labour & Employment has issued the Final Notification in the Gazette of India
(Extra Ordinary) fixing the minimum rates of wages for workers employed in the
scheduled employments Employment of Sweeping and Cleaning in the Central
sphere at Rs.120/-, Rs. 150/- and Rs.180/- per day .
Employment of Watch and Ward (a) without arms at Rs.120/-, Rs.150/- and
Rs.180/- per day and (b) with arms at Rs.140/-, Rs.170/- and Rs.200/- per day for
Area C, B and A respectively.

CONCLUSION
1. In February, 2014, taking strong exception to governments inaction in
amending the Minimum Wages Act to make it more deterrent for violators, a
Parliamentary committee has held it is high time penal provisions in the Act
as well as other such acts be revised soon. The committee said that even
after eight years of drafting of the proposal, the amendments are yet to be
enacted by Parliament.
2. The fixation and revision of minimum rates of wages through committee
method is considerably delayed in Delhi. As a result, the sweated labour is
deprived of the benefits envisaged in the Act for a long period. This surely
amounts to justice delayed is justice denied. The following reasons may be
singled out for the delay: Lack of realism on the part of the legislature,
Absence of suitable provisions in the Act and the rules made there under
which made the committee method inexpeditious, Poor support to the
Committee by the office of the Labour Commissioner and Poor performance
by the Committee.
3. The enforcement of the Act is far from satisfactory. This is due to inadequate

TH AN K YO U