The Government, in the view of labour law reforms, had rationalized 38 Labour Acts into 4 labour codes i.e. Code on Wages, Code on occupational safety, health and working conditions, Code on Industrial Relations, and Code on Social Security.
The Government on 10th August 2017 introduced ‘The Code on Wages’ in Lok Sabha which seeks to absorb four existing labour laws, namely, the Payment of Wages Act, 1936 Minimum Wages Act, 1948; the Payment of Bonus Act, 1965; and the Equal Remuneration Act, 1976. This Code of Wages will dissolve all the four prior Acts. The enactment of Code of Wages Bill will erase the complicated and multiple definitions leading to a better compliance, wage security and social security of the workers.
The gamut of the Minimum Wages Act and the Payment of Wages Act is quite reserved, catering only to Scheduled employments/establishments. This clearly shows the advantage of the Code of Wages Bill which provides for timely payment of wages irrespective to one and all and thus, covering each individual in every sector of employment without any wage ceiling.
With the enforcement of the concept of a National Minimum Wage, no state will be allowed to fix minimum wages below the National Minimum Age for that particular area which has been notified by the Central Government. This provision will assure a basic standard of living for the employees.
The proposal of paying wages through cheques or any electronic modes will not only foster digitalization but also provide to the employee a kind of social and wage security. The provision of an Appellate Authority to be made between the Judicial Forum and the Claim Authority to lead to an efficient, feasible and faster path to grievance redressal of the employees.
Also, there are penalties for the various types of violations of the Code which will be subject to the intensity and the frequency of violations by the offender.
Recently, it had been reported that the National Minimum Wage has been fixed to Rs. 18000 per month by the Central Government. The Government denying all reports clarified that it had not fixed any wage as the National Minimum Wage and thus trashing the reports as baseless. Instead, the minimum wage would be different according to the geographical location of the area, the intensity of work done, and depending on the skills required.
According to Clause 9(3) of the Code of Wages Bill, the Central Government before setting up a National Minimum Wage is supposed to take advice from the Advisory Board which would consist of employees and employers from various sectors of employment. This means that the framework provides for a consultive mechanism for the determination of a National Minimum Wage.
Also, some reports claim that the methodology for the calculation of the National Minimum Wage has been revised increasing the units from three to six. But such provision was solely the demand of the Trade Unions in the previous meeting of the Central Advisory Board on Minimum Wages which has not been incorporated in the Code of Wages Bill. Through the bill has been criticized for being introduced with a short notice, it seems to pave a path to generate greater employment and entrepreneurship.
ABOUT THE AUTHOR
ASHISH KUMAR YADAV
Ashish is an undergraduate student at Cluster Innovation Centre, University of Delhi. The institution has a Meta College concept and focuses on an interdisciplinary approach. He is the co-founder of two non-profit ventures, one of which deals with education and the other in enhancing scientific communication among the masses. He has done three research projects at Cluster Innovation Centre the first aimed to create a prototype of full-fledged Hindi dictionary and another on the Study of a community’s cultural tradition (Banjara community). The third project was Hafta bazaar aimed to digitalize and study the various weekly markets in Delhi. He is quite ardent in the field of economics and journalism and is intrigued by topics from digital marketing to management, which are reflected in his undergraduate studies. He was also a part of a report published on education.
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