Object, Scope & coverage of the ActObject, Scope & coverage of the Act

The object with which the Minimum Wages The object with which the Minimum Wages Act, 1948 was enacted has been concisely Act, 1948 was enacted has been concisely and precisely stated in the preamble of the and precisely stated in the preamble of the Act. The statement of ‘object of Bill’ points Act. The statement of ‘object of Bill’ points out:out:“The justification for statutory fixation of “The justification for statutory fixation of minimum wages is obvious. Such provisions minimum wages is obvious. Such provisions which exists in more advanced countries are which exists in more advanced countries are even necessary in India, where workers’ even necessary in India, where workers’ organization are yet poorly developed and organization are yet poorly developed and the workers’ bargain power is consequently the workers’ bargain power is consequently poor.” In brief the Act purports to achieve to poor.” In brief the Act purports to achieve to prevent exploitation of labour and for that prevent exploitation of labour and for that purpose the authorities under the Act have purpose the authorities under the Act have

been empowered to take steps to prescribe been empowered to take steps to prescribe minimum rates of wages in the scheduled minimum rates of wages in the scheduled industries.industries.

Wage: Wage: ‘wages’ are remuneration (pay for ‘wages’ are remuneration (pay for services, reward) which the workers are services, reward) which the workers are entitled for the work performedentitled for the work performed bybythem.them.

Article 43Article 43 of the Constitution enjoins the of the Constitution enjoins the Government to endeavour to secure Government to endeavour to secure conditions of work ensuring a decent conditions of work ensuring a decent standard of life and full enjoyment of leisure, standard of life and full enjoyment of leisure, social and cultural opportunities. social and cultural opportunities.

Case Law: Case Law: Crown Aluminum Works v Crown Aluminum Works v Their workmen, AIR 1958 SC 30Their workmen, AIR 1958 SC 30

In the present case the Supreme Court In the present case the Supreme Court opined that in a developing country opined that in a developing country like ours which faces the problem of like ours which faces the problem of unemployment on a very large scale, it unemployment on a very large scale, it is not unlikely that labour may offer to is not unlikely that labour may offer to work even on starvation wages… State work even on starvation wages… State assumes that every employer must assumes that every employer must pay the minimum wages for the pay the minimum wages for the employee’s labour.employee’s labour.

Restraints on the freedom of contractRestraints on the freedom of contract Article19(1)(g) of the constitution of India Article19(1)(g) of the constitution of India gives every citizen a right to practice any gives every citizen a right to practice any profession or to carry on any occupation, profession or to carry on any occupation, trade and business. But at the same time trade and business. But at the same time Article 19(6) confers power on the State to Article 19(6) confers power on the State to impose reasonable restrictions on this right impose reasonable restrictions on this right in the public interest. in the public interest.

In Hydro (Engineers) P Ltd v Their workmen In Hydro (Engineers) P Ltd v Their workmen AIR 1969 SC 182,AIR 1969 SC 182, a submission was made a submission was made that in some cases a class of employers may that in some cases a class of employers may not be in position to pay the minimum not be in position to pay the minimum wages. The Supreme Court held the wages. The Supreme Court held the restrictions of paying minimum wage restrictions of paying minimum wage reasonable under Article 19(6) of the reasonable under Article 19(6) of the constitution of India. constitution of India.

Salient Features of theSalient Features of the ActAct1.1.It provides for fixing minimum wages in It provides for fixing minimum wages in certain employments where labour is certain employments where labour is ignorant or less organised and is vulnerable ignorant or less organised and is vulnerable to exploitation.  Minimum wages are not to to exploitation.  Minimum wages are not to be fixed in respect of any industry in which be fixed in respect of any industry in which there are less than 1,000 employees in the there are less than 1,000 employees in the whole State.  (Under the 1957 amendment whole State.  (Under the 1957 amendment to the Act of 1948, this limiting condition has to the Act of 1948, this limiting condition has been substantially relaxed.)been substantially relaxed.)

2. This Act provides for the fixation of 2. This Act provides for the fixation of ——(a)(a) minimumminimum timetime raterate ofof wages;wages;(b)(b) a minimuma minimum piecepiece rate;rate;(c)(c) a guaranteed timea guaranteed time rate;&rate;&

(d) an overtime rate, for different (d) an overtime rate, for different occupations, localities or classes of work and occupations, localities or classes of work and for adults, adolescents, children and for adults, adolescents, children and apprentices.apprentices.

The minimum rate of wage under this Act The minimum rate of wage under this Act may consistmay consist of:of:(a) a basic rate of wages and a cost of living (a) a basic rate of wages and a cost of living allowance,allowance, or or (b) basic rate of wages with or without the (b) basic rate of wages with or without the cost ofcost ofliving allowance and the cash value of the living allowance and the cash value of the concession in respect of essential concession in respect of essential commodities suppliedcommodities supplied atat concessionalconcessional

rates;rates; or or (c) an all inclusive(c) an all inclusive rate. rate.

3. The Act requires that wages shall be paid 3. The Act requires that wages shall be paid in cash, although it empowers the in cash, although it empowers the appropriate Government to authorise the appropriate Government to authorise the payment of minimum wages, either in payment of minimum wages, either in wholly or partly in kind in particularwholly or partly in kind in particular cases.cases.4. It lays down that the cost of living 4. It lays down that the cost of living allowance and the cash value of concessions allowance and the cash value of concessions in respect of supplies of essential in respect of supplies of essential commodities at concessional rates shall be commodities at concessional rates shall be computed by the competent authorities at computed by the competent authorities at certain intervals. (not later than 5 year) In certain intervals. (not later than 5 year) In case of undertaking controlled by the UT and case of undertaking controlled by the UT and the Central Government the Dir, Labour the Central Government the Dir, Labour Bureau is the competent authority.Bureau is the competent authority.

5. The Act empowers the appropriate 5. The Act empowers the appropriate Government to fix numbers of hour of work Government to fix numbers of hour of work per day, to provide for a weekly holiday and per day, to provide for a weekly holiday and the payment of overtime wages in regard to the payment of overtime wages in regard to any scheduled employment in respect of any scheduled employment in respect of which minimum rates of wages have been which minimum rates of wages have been fixed under the Act.fixed under the Act.6. The establishment covered by this Act are 6. The establishment covered by this Act are required to maintain registers and records in required to maintain registers and records in the prescribedthe prescribed manner.manner.7. The Act also provides for appointment of 7. The Act also provides for appointment of Inspectors and authorities to hear and Inspectors and authorities to hear and decide claims arising outdecide claims arising out of payment of of payment of wages at less thanwages at less than thethe rate. rate.

8. The provision is also made in the Act for 8. The provision is also made in the Act for dealing with complaints made for violation dealing with complaints made for violation of the provisions of the Act and for imposing of the provisions of the Act and for imposing penalties for offence committed under the penalties for offence committed under the Act.Act.

Sec 1: Application of the ActSec 1: Application of the Act— — The Act The Act applies to whole of Indiaapplies to whole of India.. The Act applies The Act applies to employment which are enumerated in the to employment which are enumerated in the schedule of the Act and in certain cases may schedule of the Act and in certain cases may in the direction of the appropriate in the direction of the appropriate government, be extended to any other government, be extended to any other employment.employment.

Sec 2: InterpretationSec 2: Interpretation— (a) Adolescents – 14-— (a) Adolescents – 14-18 yrs18 yrsAdult–whoAdult–who hashas completedcompleted 1818 yrs.yrs.Child – who has not completed 14 years of Child – who has not completed 14 years of ageageSec 2 (g) Scheduled employment – Part I Sec 2 (g) Scheduled employment – Part I woolen carpet, shawl weaving, rice mills, woolen carpet, shawl weaving, rice mills, flour mills, dal mills, tobacco, plantation, oil flour mills, dal mills, tobacco, plantation, oil mills, under local authority construction and mills, under local authority construction and maintenance of roads, stone maintenance of roads, stone crushing( excluding mines), lac, mica, Public crushing( excluding mines), lac, mica, Public motor trasport, tanneries & leather motor trasport, tanneries & leather manufaturemanufaturePart II – Employment in agriculturePart II – Employment in agricultureCase Law: C Darsaram V Union of India Case Law: C Darsaram V Union of India (1980) 2 LLJ 461 (Pat) notification dated 28 (1980) 2 LLJ 461 (Pat) notification dated 28 May 1976 Govt revised minimum wages of May 1976 Govt revised minimum wages of workmen employed in micaworkmen employed in mica mines. mines.

The government revised minimum wages in The government revised minimum wages in mica process industry. Court held such mica process industry. Court held such revision as invalid as the notification only revision as invalid as the notification only covered mica mines notcovered mica mines not micamica process.process.SecSec 20:20: Claims-Claims-The appropriate The appropriate Government, may by notification in Official Government, may by notification in Official Gazette, appoint an authority to hear and Gazette, appoint an authority to hear and decide for any specified area ofdecide for any specified area of allallclaims:claims:(a) arising out of payment of less than the (a) arising out of payment of less than the minimumminimum ratesratesofof wages,orwages,or(b) for work done on days of rest, or(b) for work done on days of rest, or(c) in respect of wages at the overtime rate (c) in respect of wages at the overtime rate to employees employed or paid in that area. to employees employed or paid in that area.

Authority for Hearing & Deciding ClaimsAuthority for Hearing & Deciding ClaimsThe following authority may be appointed to The following authority may be appointed to hear & decide claims under the MWA, 1948 hear & decide claims under the MWA, 1948 1. Commissioner for Workmen’s 1. Commissioner for Workmen’s CompensationCompensation2.Labour Commissioner appointed by the 2.Labour Commissioner appointed by the Central GovtCentral Govt3. Any officer not below the rank of the 3. Any officer not below the rank of the Labour Commissioner appointed by the Labour Commissioner appointed by the State GovtState Govt4. Any other officer with an experience as a 4. Any other officer with an experience as a Judge of a Civil Court or as a stipendiary Judge of a Civil Court or as a stipendiary magistratemagistrate

Who may apply?Who may apply?1. The employee himself; or 1. The employee himself; or 2. Any legal practioner; or2. Any legal practioner; or3.Any official of a registered Trade Union, 3.Any official of a registered Trade Union, authorized in writing to act on his behalf; orauthorized in writing to act on his behalf; or4.Any inspector; or4.Any inspector; or5. Any person acting with permission of the 5. Any person acting with permission of the authority.authority.Sec 22 & 22A: Offences & PenaltiesSec 22 & 22A: Offences & Penaltiesfor paying less than minimum wages fixed – for paying less than minimum wages fixed – imprisonment up to 6monthsimprisonment up to 6months

Cognizance of the offences:Cognizance of the offences:No court shall take cognizance of a No court shall take cognizance of a complaint against any person for a offence: complaint against any person for a offence: (a) involving payment of less than the (a) involving payment of less than the minimum wages unless the appropriate minimum wages unless the appropriate authority has sanctioned the making of the authority has sanctioned the making of the complaint;complaint;(b) involving contravention of the any other (b) involving contravention of the any other rule or order made under Sec 13( fixing hrs rule or order made under Sec 13( fixing hrs of working) or Sec 22A General provision for of working) or Sec 22A General provision for punishment of other offences except on a punishment of other offences except on a complaint made by, or with the sanction, of complaint made by, or with the sanction, of an Inspector.an Inspector.

Further no court shall take cognizance of an Further no court shall take cognizance of an offence-offence-(i) under Sec 22 unless complaint thereof is (i) under Sec 22 unless complaint thereof is made within one month of the grant of made within one month of the grant of sanction.sanction.(ii) unless complaint thereof is made within (ii) unless complaint thereof is made within six months of the date on which the offence six months of the date on which the offence is alleged to have beenis alleged to have been committed.committed.

Sec 22C: Offences by CompaniesSec 22C: Offences by Companies

Minimum Wages & the ILOMinimum Wages & the ILO

• ILO adopted a Convention No. 20 and a ILO adopted a Convention No. 20 and a Recommendation No. 30 on minimum wage Recommendation No. 30 on minimum wage fixing machinery, 1928, covering only non- fixing machinery, 1928, covering only non- agriculture sector. In 1951, the ILO agriculture sector. In 1951, the ILO conference at its 34conference at its 34thth Session adopted a Session adopted a Minimum Wage fixing Convention No. 99 and Minimum Wage fixing Convention No. 99 and a Recommendation No. 83 for agriculture a Recommendation No. 83 for agriculture employments. Since then a number of employments. Since then a number of conventions and recommendations have conventions and recommendations have been adopted having important bearing on been adopted having important bearing on the question of minimum wages.the question of minimum wages.