THE MINIMUM WAGES ACT 1948

The Minimum wages .

The minimum wages Act 1948, was to secure the
welfare of unorganised workers in certain
industries by fixing the minimum rates of wages.
The Act contemplates that minimum wages rates
must ensure for him not only his subsistence and
that of his family but also preserve his efficiency
as a workman.
The Act empowers the
appropriate Government for fixation of minimum
wages in employments enumerated in the
schedule to the Act. The fixation of minimum
wages relates to the industries where sweated
labour is most prevalent or where there is
inevitable chance of exploitation. In prescribing
the minimum wages rates, the capacity of the

Objectives of the act.

To

provide minimum wages to the workers

working in organized sector.
To stop exploitation of the workers.
To empower the government to take steps
for fixing minimum wages and to revising it
in a timely manner.
To apply this law on most of the sections
in organized sector.

Short title and extent

(sec. 1)
This

Act, the Minimum Wages

Act, 1948 extends to the whole
of India.
This Act may be called the
Minimum Wages Act, 1948.

Interpretation/Definition
(sec.2)

(b) Appropriate government India has

federal form of Government at the centre and
state level . The minimum wages act provide
separate areas of jurisdiction for both centre
and state government.
(e) Employer means any person who employs
one or more employees in any schedule of
employment.
(i) Employee means any person employed for
hire or reward and includes an out worker.

DEFINITIONS

Wages [sec 2(h)] Wages means all

remuneration capable of being
expressed in terms of money, which
would, if terms of contract of
employment, express or implied, were
fulfilled, be payable to a person
employed in respect of his
employment or of work done in such
employment and includes house rent
allowance

But wages does not include the following:

(i) the value of: (a) any house accommodation, supply of light,
water, medical attendance, or (b) any other amenity or any
service excluded by general or special order of the appropriate
government;
(ii) any contribution paid by the employer to any Pension Fund
or Provident Fund or under any scheme of social insurance;
(iii) any traveling allowance or the value of any traveling
concession;
(iv) any sum paid to the person employed to defray special
expenses entailed on him by the nature of his employment; or
(v) any gratuity payable on discharge.
The term wages includes payment of remuneration in respect
of days of rest. It also includes bonus paid not ex-gratia
payment.

FIXATION AND REVISION OF MINIMUM

WAGES

fixing of minimum rates of wages

(sec.3)

The minimum rates of wages will be

reviewed/ revised, for every five years, by
the appropriate govt.
Appropriate govt. can add any
employment, to the schedule(part-I or part
II), wherein one thousand or more employees
are found working
Different minimum rates of wages may be
fixed for different scheduled employments/
different classes of work /different localities

Procedure for fixation and revision

of minimum rates of wages (sec.5)
Publish its proposals in the official gazette
asking comments from the affected parties.
Constitute committees/sub committees for
the purpose.
The committees/sub-committees and advisory
boards constituted by the Government consist
of equal number of members of :

Employers
Employees, and
Independent persons

Advisory board (sec.7)

Appointed by appropriate government.

To co-ordinate the work of committees and sub

committees appointed under Section 5.

Central advisory board (sec.8)

To advise the Central and State Governments

in fixation and revision of minimum rates of wages.

To co-ordinate the work of the Advisory Boards.

PAYMENT OF MINIMUM
WAGES
Wages in kind (sec. 11)

Minimum wages shall be paid in

cash.
The appropriate govt. may authorize,
where there has been a custom of
payment in this manner, payment of
minimum wages either wholly or
partly in kind.
The appropriate govt. may authorize
supply of essential commodities at

Payment of minimum rate of wages

(sec. 12)
The

Minimum Wages has to be paid

without any deductions other than
Statutory Deductions.

Payment

of wages less than

minimum wages on the ground of
less performance or output is illegal.

Fixing hours of work

(sec. 13)
For an Adult Worker working in Factories:
Number of Working Hours should not exceed
48 Hours in a week with a weekly
Holiday.
The Daily Hours should not exceed more
than 9 Hours with 1 Hour Rest Interval.
Provision of Compensatory Holiday/Overtime
Wages if working on holiday.

Overtime wages
(sec. 14)
If the person has worked for more than 48

hours in a week then, the excess hours worked

will be treated as Overtime.
Overtime wage rate will be twice of the

normal wage rate .

Wages for a person who has worked less

than normal working hours (sec. 15)

Employer could not provide the activities

of the job then, the employee is
entitled to receive full salary .
Employee has not worked due to his
unwillingness then, the employee is not
entitled to receive full salar y.

Claims
(sec. 20)
A Labour Commissioner or any other
appointed authority is authorized to
hear claims regarding non-payment
of minimum wages
Any aggrieved person may apply to
the authority for settling his claims
within 6 months

AMOUNT OF COMPENSATION
[SEC. 20(3)].

Where an application has been admitted by the Authority,

the Authority shall hear the applicant and the employer
or give them an opportunity of being heard and after
such further inquiry as it considers necessary may direct(i)
in the case of claims arising out of payment of less than
the minimum rates of wages, the payment to the
employee the difference between the minimum wages
payable to him and the wages actually paid, together,
with the payment of such compensation as the
Authority may think fit but not exceeding 10 times the
amount of difference.
(ii)
in any other case, the payment of the amount due to
the employee, together with the payment of
compensation as it may think fit, not exceeding Rs. 10.
The Authority may direct payment of such compensation in
cases where the excess or the amount due is paid by the
employer to the employee before the disposal of the
application.

MALICIOUS OR VEXATIOUS
APPLICATION (SEE 20(4)]
If the Authority hearing an application is
satisfied that it was malicious or
vexatious, it may direct that a penalty
not exceeding Rs. 50 be paid to the
employer by the person presenting the
application.

Penalties
(sec. 22)
Offence
Payment of less than
Minimum Wages to
employee

Punishment
Imprisonment which may
extend up to 6 Months or
Fine which may extend
up to Rs 500/- or Both

Contracting out
(Sec. 25)
Any

contract or agreement, whether

made before or after the commencement
of this Act, whereby an employee either
relinquishes or reduces his right to a
minimum rate of wages or any
privilege or concession accruing to him
under this Act shall be null and void so
far as it purports to reduce the minimum
rate of wages fixed under this Act.