A minimum wage is the lowest hourly, daily or monthly wage that employers may legally pay to employees or workers. Equivalently, it is the lowest wage at which workers may sell their labor. Although minimum wage laws are in effect in a great many jurisdictions, there are differences of opinion about the benefits and drawbacks of a minimum wage. Supporters of the minimum wage say that it prevents the exploitation of workers. Opponents say that if it is high enough to be effective, it destroys jobs, particularly for workers with very low productivity due to inexperience or handicap, thereby exploitation lesser skilled workers to the benefit of better skilled workers. They also argue that it causes inflation.
In India, 422.6 (94%) million workers out of the total workforce of 457.5 million belong to the unorganized/informal sector. These workers contribute to more than 60 per cent to India’s GDP growth. Among other sectors, these workers work as farm laborers, landless laborers, factory workers and construction workers. Currently the number of scheduled employments in the Central government is 45, whereas in the state sphere the number is 1232.
The Minimum Wage Act, 1948 provides for fixation and enforcement of Minimum wages in respect of schedule employments to prevent sweating or exploitation of labour through payment of low wages. The objective of the Act is to ensure a Minimum subsistence wage for workers. The Act requires the appropriate government to fix Minimum rates of wages in respect of employment specified in the schedule and review and revise the Minimum rates of wages at intervals not exceeding five years.
In September 2007, the national Minimum floor level wage was increased to Rs 80 per day for all scheduled employments from Rs 66 in 2004 to Rs. 45 in 1999, Rs. 40 in 1998 and Rs. 35 in 1996.
Fixation of Minimum Wage
Minimum rate of the wages fixed or revised consists of the following:
A basic rate of wages and a special allowance, viz., cost of living allowance ;
A basic rate of wages with or without cost of living allowance and cash value of
concessions for supplies of essential commodities ;
An all inclusive rate, i.e. basic rate, cost of living allowance and cash value of concessions.
The Government may fix the minimum rates of wages either by the hour, by the day, by the month or by such wage period as may be prescribed.
The minimum wage rate may be fixed at a) time rate, b) piece rate, c) guaranteed time rate and d) overtime rate.
The Act provides that different minimum wage rate may be fixed for a) different scheduled employments, b) different works in the same employment, c) adult, adolescent and children, d) different locations or e) male and female.
Also, such minimum wage may be fixed by a) an hour, b) day, c) month, or d) any other period as may be prescribed by the notified authority.
Norms for fixing minimum wage:
• Three consumption units per earner,
• Minimum food requirement of 2700 calories per average Indian adult,
• Cloth requirement of 72 yards per annum per family,
• Rent corresponding to the minimum area provided under the government's Industrial Housing Scheme and
• Fuel, lighting and other miscellaneous items of expenditure to constitute 20 per cent of the total minimum wage
• Fuel, lighting and other miscellaneous items of expenditure to constitute 20% of the total Minimum Wages,
• Children education, medical requirement, minimum recreation including festivals/ceremonies and provision for old age, marriage etc. should further constitute 25% of the total minimum wage.
Cost of Living Allowance:
The minimum basic wages fixed are linked to consumer price index as a counter measure against inflation. The cost of living is set twice in a year. The Commissioner of Labour notifies the rate 1st of April and 1st of October. The rates are fixed on the basis of the average rise in the State industrial workers consumer price index numbers for half year ending December and June respectively.
Variable Dearness Allowance:
Dearness Allowance is payable to monthly, daily and piece rate earners. Every six months the respective State Governments issues the Cost of Living Index number for each and every scheduled employment.
By Nilesh Shah
Laurent & Benon Management Consultants Ltd, a public limited company with its corporate office Gurgaon with Pan-India presence. We as an organization strive to offer the right Human Resource Solutions at the right time and enable our clients to enhance the net worth of their human resource capital.
For further Information please Visit us at: http://www.laurentandbenon.co.in/
Visit Blog at: http://laurentandbenon.blogspot.com/
From India, Pune
In India, 422.6 (94%) million workers out of the total workforce of 457.5 million belong to the unorganized/informal sector. These workers contribute to more than 60 per cent to India’s GDP growth. Among other sectors, these workers work as farm laborers, landless laborers, factory workers and construction workers. Currently the number of scheduled employments in the Central government is 45, whereas in the state sphere the number is 1232.
The Minimum Wage Act, 1948 provides for fixation and enforcement of Minimum wages in respect of schedule employments to prevent sweating or exploitation of labour through payment of low wages. The objective of the Act is to ensure a Minimum subsistence wage for workers. The Act requires the appropriate government to fix Minimum rates of wages in respect of employment specified in the schedule and review and revise the Minimum rates of wages at intervals not exceeding five years.
In September 2007, the national Minimum floor level wage was increased to Rs 80 per day for all scheduled employments from Rs 66 in 2004 to Rs. 45 in 1999, Rs. 40 in 1998 and Rs. 35 in 1996.
Fixation of Minimum Wage
Minimum rate of the wages fixed or revised consists of the following:
A basic rate of wages and a special allowance, viz., cost of living allowance ;
A basic rate of wages with or without cost of living allowance and cash value of
concessions for supplies of essential commodities ;
An all inclusive rate, i.e. basic rate, cost of living allowance and cash value of concessions.
The Government may fix the minimum rates of wages either by the hour, by the day, by the month or by such wage period as may be prescribed.
The minimum wage rate may be fixed at a) time rate, b) piece rate, c) guaranteed time rate and d) overtime rate.
The Act provides that different minimum wage rate may be fixed for a) different scheduled employments, b) different works in the same employment, c) adult, adolescent and children, d) different locations or e) male and female.
Also, such minimum wage may be fixed by a) an hour, b) day, c) month, or d) any other period as may be prescribed by the notified authority.
Norms for fixing minimum wage:
• Three consumption units per earner,
• Minimum food requirement of 2700 calories per average Indian adult,
• Cloth requirement of 72 yards per annum per family,
• Rent corresponding to the minimum area provided under the government's Industrial Housing Scheme and
• Fuel, lighting and other miscellaneous items of expenditure to constitute 20 per cent of the total minimum wage
• Fuel, lighting and other miscellaneous items of expenditure to constitute 20% of the total Minimum Wages,
• Children education, medical requirement, minimum recreation including festivals/ceremonies and provision for old age, marriage etc. should further constitute 25% of the total minimum wage.
Cost of Living Allowance:
The minimum basic wages fixed are linked to consumer price index as a counter measure against inflation. The cost of living is set twice in a year. The Commissioner of Labour notifies the rate 1st of April and 1st of October. The rates are fixed on the basis of the average rise in the State industrial workers consumer price index numbers for half year ending December and June respectively.
Variable Dearness Allowance:
Dearness Allowance is payable to monthly, daily and piece rate earners. Every six months the respective State Governments issues the Cost of Living Index number for each and every scheduled employment.
By Nilesh Shah
Laurent & Benon Management Consultants Ltd, a public limited company with its corporate office Gurgaon with Pan-India presence. We as an organization strive to offer the right Human Resource Solutions at the right time and enable our clients to enhance the net worth of their human resource capital.
For further Information please Visit us at: http://www.laurentandbenon.co.in/
Visit Blog at: http://laurentandbenon.blogspot.com/
From India, Pune
Dear Riya
You can get the details for the same for all states in India by clicking the below link:
Minimum Wages India ? Current Minimum Wage Rate India
From India, Delhi
59You can get the details for the same for all states in India by clicking the below link:
Minimum Wages India ? Current Minimum Wage Rate India
From India, Delhi
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Minimum Wage of UP & UK.pdf