The Code on Wages Bill 2017
Ministry of Labour & Employment
05-September, 2017
The Code on Wages Bill 2017
As part of labour law reforms, the
Government has undertaken the exercise of rationalisation of the 38
Labour Acts by framing 4 labour codes viz Code on Wages, Code on
Industrial Relations, Code on Social Security and Code on occupational
safety, health and working conditions.
1. The Code on Wages Bill 2017 has been
introduced in Lok Sabha on 10.08.2017 and it subsumes 4 existing Laws,
viz. the Minimum Wages Act, 1948; the Payment of Wages Act, 1936; the
Payment of Bonus Act, 1965; and the Equal Remuneration Act, 1976. After
the enactment of the Code on Wages, all these four Acts will get
repealed. The Codification of the Labour Laws will remove the
multiplicity of definitions and authorities leading to ease of
compliance without compromising wage security and social security to the
workers.
2. At present, the provisions of the
Minimum Wages Act and the Payment of Wages Act do not cover substantial
number of workers, as the applicability of both these Acts is restricted
to the Scheduled Employments / Establishments. However, the new Code on
Wages will ensure minimum wages to one and all and timely payment of
wages to all employees irrespective of the sector of employment without
any wage ceiling.
3. A concept of statutory National
Minimum Wage for different geographical areas has been introduced. It
will ensure that no State Government fixes the minimum wage below the
National Minimum Wages for that particular area as notified by the
Central Government.
4. The proposed payment of wages through
cheque or digital/ electronic mode would not only promote digitization
but also extend wage and social security to the worker. Provision of an
Appellate Authority has been made between the Claim Authority and the
Judicial Forum which will lead to speedy, cheaper and efficient
redressal of grievances and settlement of claims
5. Penalties for different types of
violations under this Code have been rationalized with the amount of
fines varying as per the gravity of violations and repeat of the
offences. Provision of compounding of offences has been made for those
which are not punishable by a penalty of imprisonment.
6. Recently, some news reports have been
published regarding the fixation of minimum wage as Rs. 18000/- per
month by the Central Government. It is clarified that the Central
Government has not fixed or mentioned any amount as “national minimum
wage” in the Code on Wages Bill 2017. The apprehension that minimum wage
of Rs. 18000/- per month has been fixed for all employees is, thus
incorrect, false and baseless. The minimum wages will vary from place to
place depending upon skill required, arduousness of the work assigned
and geographical location.
7. Further, the Code on Wages Bill 2017,
in the clause 9 (3), clearly states that the Central Government, before
fixing the national minimum wage, may obtain the advice of the Central
Advisory Board, having representatives from employers and employees.
Therefore the Code provide for a consultative mechanism before
determining the national minimum wage.
8. Some reports have also been appearing
in the media regarding the revised methodology for calculation of
minimum wages by enhancing the units from three to six. It was purely a
demand raised by Trade Unions in the recent meeting of the Central
Advisory Board on Minimum Wages. However it is clarified that such
proposal is not part of the Code on Wages Bill.
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AK
(Release ID :170541)
AK
(Release ID :170541)