THE MINIMUMWAGES ACT 1948

INDUSTRIAL RELATIONS AND LABOUR LAW

Historical Backdrop
• The initiative started with the resolution placed by one Shri. K. G. R. Choudhary in 1920 for setting up
Boards for determination of minimum wages in each industry.
• The International Labour Conference adopted in 1928 Convention No.26 and Recommendation No. 30
relating to wage fixing machinery in trades or parts of trades.
• On the recommendation of the Standing Labour Committee and Indian Labour Conference, a Labour
Investigation Committee was appointed in 1943 to investigate into the question of wages and other
matters like housing, social conditions and employment.
• A draft bill was considered by the Indian Labour Conference in 1945.
• The 8th meeting of the Standing Labour Committee recommended in 1946 to enact a separate
legislation for the unorganized sector including working hours, minimum wages and paid holidays.
• A Minimum Wages Bill was introduced in the Central Legislative Assembly on 11.4.1946 to provide for
fixation of minimum wages in certain employments. It was passed in 1946 and came into force with
effect from 15.3.1948.

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• 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.
OBJECTIVESOF THE
ACT
Object, Constitutional Validity and Salient
Features

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The norms include those which were recommended by
the Indian Labour Conference in its session held in 1957.
NormsforFixation/Revisionof
(a) 3 consumption units for one earner. MinimumWages
(b) Minimum food requirements of 2700 calories per
average Indian adult.
(c) Clothing requirements of 72 yards per annum per
family.
(d) Rent corresponding to the minimum area provided
for under Government's Industrial Housing Scheme.
(e) Fuel, lighting and other miscellaneous items of
expenditure to constitute 20% of the total Minimum
Wages.
Other parameters
(i) "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."
(ii) (ii) Local conditions and other factors influencing the
wage rate.

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 APPLICABILITY
Section I

• This Act, the Minimum Wages Act, 1948 extends to the

whole of India.
• The act is not applicable to all employment or industries.
List of employments that is covered by the act, regardless
of number of workers actually employed. The appropriate
government may add any employment to the list if there
are 1000 workers are working in that state.
Part I (non-agricultural employments) & part II ( agriculture &
allied activities)
• The appropriate government may add to the schedule any
other employment in respect of which it is of the opinion
that minimum wages should be fixed.
• The Minimum Wages Act does not provide for any
discrimination between male and female workers or
different minimum wages for them.
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 DEFINITIONS
WAGES
The minimum wages act, 1948 defines wages as under section 2(h), which reads as under:
Wages means all remuneration, capable of being expressed in terms of money, which accrued, in terms of contract of
employment, express or implied, were fulfilled be payable to person employed in respect of his employment or of work done
in such employment and includes house rent allowance but does not include:
• The value of
 any house accommodation, supply of light, water, medical attendance or
 any other amenity or any service excluded by general / special orders of appropriate government
• Any contribution paid by the employer to any pension fund or provident fund or under any issuance of social insurance
• Any traveling allowance or value of any traveling concession.
• Any sum paid to the person employed to defray special expenses entailed on him by nature of his employment
• Any gratuity payable on discharge

APPROPRIATE GOVERNMENT
CENTRAL GOVERNMENT – under the authority of Central Government, Railways, mine, oil-field, port or corporation by
central act.
STATE GOVERNMENT – within the territory.
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EMPLOYER
Employer means any person who employs one or more employees in any schedule of employment.

EMPLOYEE
Any person who is employed for hire or reward to do any work, skilled or unskilled, manual or clerical, in a scheduled
employment in respect of which minimum rates of wages have been fixed. but does not include any member of the
Armed Forces of the Union.

COST OF LIVING INDEX NUMBER

The index number ascertained and declared by the competent authority by notification in the Official Gazette to be the
cost of living index number.

COMPETENT AUTHORITY
The authority appointed by the appropriate Government to ascertain from time to time the cost of living index number
applicable to the employees.

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FIXING OF MINIMUM
RATES OFWAGES
Rate of wages, wage period, methods

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In fixing or revising minimum rates of wages under this section, different minimum rates of wages may be fixed for
• different scheduled employments
• different classes of work in the same scheduled employment
• adults, adolescents, children and apprentices
• different localities
The rate of wages may be fixed by
• a minimum rate of wages for time work
• a minimum rate of wages for piece work
• a guaranteed time rate
• An overtime rate
The minimum rates of wages may be fixed by any one or more of the following wage-periods, namely
• by the hour,
• by the day,
• by the month, or
• by such other larger wage-period as may be prescribed.

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 METHODS FOR FIXATION
Section 3 empowers appropriate Government to fix the minimum rates of wages in the scheduled employments.
Revision
Revise the Minimum rates at an appropriate interval not exceeding five years.
Procedure for Fixation/Revision
In Section 5 of the Minimum Wages Act, 1948, two methods have been provided for fixation/revision of minimum
wages. They are Committee method and Notification method.
• Committee Method
Under this method, committees and sub-committees are set up by the appropriate Governments to hold enquiries and
make recommendations with regard to fixation and revision of minimum wages, as the case may be.
• Notification method
In this method, Government proposals are published in the Official Gazette for information of the persons likely to be
affected thereby and specify a date not less than two months from the date of the notification on which the proposals
will be taken into consideration.
After considering advice of the Committees/Sub-committees and all the representations received by the specified date
in Notification method, the appropriate Government shall, by notification in the Official Gazette, fix/revise the
minimum wage in respect of the concerned scheduled employment and it shall come into force on expiry of three
months from the date of its issue.

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Advisory Board
For the purpose of co-ordinating the work of committees and sub-committees appointed under section and advising
the appropriate Government generally in the matter of fixing and revising minimum rates of wages, the appropriate
Government shall appoint an Advisory Board.

Central Advisory Board

• For the purpose of advising the Central and State Governments in the matters of the fixation and revision of
minimum rates of wages and other matters under this Act and for co-ordinating the work of the Advisory Boards,
the Central Government shall appoint a Central Advisory Board.
• The Central Advisory Board shall consist of persons to be nominated by the Central Government representing
employers and employees in the scheduled employments, who shall be equal in number, and independent persons
not exceeding one-third of its total number of members; one of such independent persons shall be appointed the
Chairman of the Board by the Central Government.
Wages in kind
Minimum wages payable under this Act shall be paid in cash.
The appropriate Government authorize the payment of minimum wages either wholly or partly in kind
The appropriate Government fix the no. of hours of work, rest day, payment of overtime, norms to maintain registers
and records, etc.

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MAINTENANCE OF REGISTERS AND RECORDS
Every employer shall maintain such registers and records giving such particulars of employees employed by him, the
work performed by them, the wages paid to them, the receipts given by them and such other particulars and in such
form as may be prescribed.
INSPECTORS
• any premises or place where employees are employed
• examine any person whom he finds in any such premises
• seize or take copies of such register

PENALTIES FOR CERTAIN OFFENCES

Any employer who-- (a) pays to any employee less than the minimum rates of wages fixed for that employee's class of
work, or less than the amount due to him under the provisions of this Act, or
(b) contravenes any rule or order made under section 13, shall be punishable with imprisonment for a term which may
extend to six months, or with fine which may extend to 10,000 rupees, or with both.
Provided that in imposing any fine for an offence under this section, the Court shall take into consideration the amount
of any compensation already awarded against the accused in any proceedings taken under section 20.

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ENFORCEMENT
Two Levels
• In the Central Sphere, the enforcement is secured through the Inspecting officers of the Chief Labour Commissioner
(Central) commonly designated as Industrial Relations Machinery (CIRM)
• The compliance in the State Sphere is ensured through the State Enforcement Machinery.
They conduct regular inspections and in the event of detection of any case of non-payment or under-payment of
minimum wages, they advise the employers to make payment of the shortfall of wages.
In case of non-compliance, penal provisions prescribed in the Act are taken recourse to.

NATIONAL WAGE POLICY

Though it is desirable to have a National Wage Policy it is difficult to conceive a concept of the same. Because fixation
of wages depends on a number of criteria like local conditions, cost of living and paying capacity also varies from State
to State and from industry to industry, it would be difficult to maintain uniformity in wages.

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 Steps taken to reduce disparities
• Five Regional Committees
Eastern Region (6) West Bengal, Orissa, Bihar, Jharkhand, Chhattisgarh and Andaman & Nicobar Islands.
North Eastern Region (8) Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura and
Sikkim.

Southern Region (6) Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, Pondicherry and Lakshadweep.
Northern Region (9) Punjab, Rajasthan, Himachal Pradesh, Jammu & Kashmir, Haryana, Uttar Pradesh,
Uttarakhand, Delhi and Chandigarh.

Western Region (6) Maharashtra, Gujarat, Goa, Madhya Pradesh, Dadra & Nagar Haveli and Daman & Diu.

• National Floor Level Minimum Wage

a concept of National Floor Level Minimum Wage was mooted on the basis of the recommendations of the
National Commission on Rural Labour (NCRL) in 1991. Keeping in view the recommendation of NCRL and
subsequent rises in price indices, the National Floor Level Minimum Wage was fixed at Rs.35/- per day in 1996.

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Schedule of Employments Covered
under Minimum Wages Act, 1948 in
Delhi UT

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Minimum rates of wages in Scheduled Employment in the CapitalTerritory of Delhi

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ThankYou
SHIVANGI GUPTA
215117006

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