“The Act contemplates that minimum wage rates should be fixed in the scheduled industries with the dual object of providing subsistence and maintenance of the worker and his family and preserving his efficiency as a worker” [1]
Introduction
In general, wages are the sum of money to be paid by the employer to a worker in return for services provided. Due to weak bargaining power, the labor force in many areas used to work for low wages. The Minimum Wage Act provides machinery for the fixation of labor wages. It protects the interest of those workers who are unable to stand for themselves. Such legislation is highly needed in India where worker’s organizations are not developed adequately.
Features of the Act
The Minimum Wage act deals with employment where there are 1000 workers. The act contributes to fix
- Minimum time rates of wages.
- A guaranteed time rate
- Overtime Rate and
- Minimum piece rate.
Under this act, the minimum rate of wages is basic rates of cost of living or wages. This act also fixes the no. Of hours, weekly holidays, payment of overtime, etc. Under this act, the nonpayment of a minimum wage is punishable for up to six months of imprisonment. This act was described by the National Commission on labor as a landmark in labor legislation history. Under this act, there are three kinds of wages :
- Minimum Wage
- Fair wage
- Living wage
This act does not expressly define the meaning of “minimum wage”. Minimum wage is a basic wage that provides essentials of life and it also helps in medical treatment and education facilities. On the other hand, Fair wage is always above the minimum wage. In this, the fair needs of the family of an employee are taken into consideration.
A living wage is always above the fair wage and the minimum wage. It does not only helps in essentials but it also provides for economical comforts such as social needs, insurance, education facilities, etc. A living wage is not just limited to the essentials of life but it also helps in evil and old days.[2]
Minimum wage other than the living wage is the lowest limit which must be paid anyhow. In Crown Aluminum Works v. Their Workmen [3] , it was held that it is very difficult to differentiate between these three wages. They vary according to economic conditions.
Constitutional Validity
The constitutional validity of this act was upheld in Bijay Cotton Mills Ltd v. the State of Ajmer [4] , where it was observed that its a duty of the state to secure all workers living wages and conditions of work. [5] Section 3 of the said Act empowers the appropriate government to fix minimum rates of wages. It also empowers the government to review wages in intervals of not exceeding five years.[6] The government can appoint as many committees or sub-committees for fixation procedures. [7] Section 12 of the act makes it compulsory on part of an employer to pay the minimum rate of wages to every employee.
Sources:
[1]Unichay vs. State of Kerala, AIR 1962 SC 12
[2] Kamani Metals and Alloys Ltd. V. Workmen AIR 1967,SC 1175
[3] AIR 1958 SC 30
[4] AIR 1955
[5] Article 43 of the Indian Constitution
[6] Section 3(1)(b)
[7] Section 5
This blog is written by Riddhi Chadha, Fairfield Institute of Management & Technology.
Some of her Blogs-
- INTERNET BANKING SECURITY THREATS: Legal framework
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