Wages Code Bill will enable minimum wage: Gangwar

Wages Code Bill will enable minimum wage: Gangwar

Agency News

New Delhi, Jul 30: Labour Minister Santosh Gangwar said on Tuesday that the Wages Code Bill will enable minimum wage for every worker besides addressing issues regarding delay in payment to employees. The Bill, which seeks to amend and consolidate the laws pertaining to workers' remuneration and enable the Centre to fix minimum wages for the entire country, was passed in the Lok Sabha with voice vote.Replying to a three-hour debate on The Code on Wages, 2019, Mr Gangwar said this historic bill will benefit 50 crore workers from the organised and unorganised sector.

The proposed Code replaces the following four laws: the Payment of Wages Act, 1936, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976.The Code will apply to all employees. The central government will make wage-related decisions for employments such as railways, mines, and oil fields, among others while state governments will make decisions for all other employments.

The Bill, introduced in Lok Sabha on July 23, saw the participation of 22 members in the debate.Mr Gangwar stated that the government has accepted 17 out of the 24 recommendations made by the Standing Committee which had scrutinised a similar bill introduced in the previous Lok Sabha.The Code on Wages is one of the four codes that would subsume 44 labour laws with certain amendments to improve the ease of doing business and attract investment for spurring growth.

The proposed law seeks to regulate wage and bonus payments in all employments where any industry, trade, business, or manufacturing is carried out.Wages include salary, allowance, or any other component expressed in monetary terms and does not include bonus payable to employees or any travelling allowance, among others. All employees whose wages do not exceed a specific monthly amount, notified by the central or state government, will be entitled to an annual bonus.

The bonus will be at least 8.33 percent of his wages, or Rs 100, whichever is higher. In addition, the employer will distribute a part of the gross profits amongst the employees. An employee can receive a maximum bonus of 20 percent of his annual wages. According to the Code, the central government will fix a floor wage, taking into account the living standards of workers.

The Centre may set different floor wages for different geographical areas. Before fixing the floor wage, the central government may obtain the advice of the Central Advisory Board and may consult with state governments.The minimum wages decided by the central or state governments must be higher than the floor wage. In case the existing minimum wages fixed by the central or state governments are higher than the floor wage, they cannot reduce the minimum wages.

The Code prohibits employers from paying wages less than the minimum wage. Minimum wages will be notified by the central or state governments.
This will be based on time, or number of pieces produced. The minimum wages will be revised and reviewed by the central or state governments at an interval of not more than five years. While fixing minimum wages, the central or state governments may take into account factors including skill of workers and difficulty of work.

The Code prohibits gender discrimination in matters related to wages and recruitment of employees for the same work or work of similar nature. The central and state governments will constitute advisory boards. The Central Advisory Board will consist of employers, employees (in equal number as employers), independent persons, and five representatives of state governments.

State Advisory Boards will consist of employers, employees, and independent persons. Further, one-third of the total members on both the central and state Boards will be women. The Boards will advise the respective governments on various issues including fixation of minimum wages, and increasing employment opportunities for women. The Code specifies penalties for offences committed by an employer, such as paying less than the due wages, or for contravening any provision of the Code.

Penalties vary depending on the nature of offence, with the maximum penalty being imprisonment for three months along with a fine of up to Rs one lakh.During the debate, RSP member N K Premachandran said there should be single statutory wages applicable to all labourers. Formula for minimum wages is missing he said and suggested comprehensive definition of employers and workers. The other three labour codes should be sent to standing committee and public opinion should be sought, the vocal lawmaker maintained. Prof Saugata Roy (AITC) said the condition of workers is very bad.

"The workers will have bargaining power only as long as the management makes a profit," he said. He maintained that there are no unions for the IT and call centre industries, adding that workers are losing basic rights. Nama Nageswara Rao of TRS said child labour should see better regulation and that bonuses to workers should be proportional to profits, "if the employer reaps a big profit, the bonus should be proportionally increased."

"It is just reorganisation of bills. I disagree that this is a historic Bill," said Supriya Sule of the NCP. PSU employees haven't been paid by the government and this Bill doesn't raise the spirits of the common man, she pointed out.DMK Member D Ravikumar said one is afraid that the labour rights won over the years would end up being tarnished by the Code on Wages' clauses on minimum wages.UNI