MINIMUM WAGES ACT -1948
INTRODUCTION :
Introduction
Post-independence India faced significant challenges
concerning labor exploitation and inadequate wage
structures. To address these issues, the Minimum
Wages Act was introduced in 1948, aiming to provide a
statutory mechanism for fixing minimum wages in
various employments. The Act ensures that workers are
not paid below the threshold that would compromise
their health and efficiency.
🎯 Objectives of the Act
1. Prevent Exploitation: Safeguard workers from
being paid unduly low wages.
2. Ensure Basic Living Standards: Guarantee wages
sufficient for subsistence and efficiency.
3. Promote Fair Wage Structure: Establish uniformity
in wage rates across sectors.
4. Facilitate Economic Justice: Align with the
Directive Principles of State Policy, particularly
Article 43 of the Indian Constitution.
⚖️Key Provisions
1. Fixation of Minimum Wages (Section 3)
The appropriate government is authorized to fix
minimum wage rates for scheduled employments,
considering factors like region, type of work, and skill
level.
2. Components of Minimum Wages (Section 4)
Minimum wages may consist of:
A basic rate of wages and a special allowance (cost
of living allowance).
A basic rate with or without the cost of living
allowance and the cash value of concessions.
An all-inclusive rate comprising the basic rate, cost
of living allowance, and cash value of concessions.
3. Payment of Wages (Section 11)
Wages should be paid in cash. However, if it is
customary to pay wages wholly or partly in kind, the
appropriate government may authorize such payments.
4. Working Hours and Overtime (Section 13)
The Act prescribes the number of working hours in a
normal working day and provides for a day of rest in
every seven days. It also mandates payment for
overtime work at a rate not less than one and a half
times the normal wage rate.
5. Advisory Boards (Sections 7 & 8)
Establishment of Advisory Boards and Central Advisory
Boards to coordinate the work of committees and
advise the government in fixing and revising minimum
wages.
6. Penalties for Offences (Section 22)
Employers paying less than the minimum wages or
violating other provisions of the Act may face
imprisonment up to six months, a fine up to ₹500, or
both.
🧩 Implementation and Challenges
While the Act provides a robust framework, its
implementation faces challenges:
Informal Sector Dominance: A significant portion
of India's workforce is in the informal sector,
making enforcement difficult.
Lack of Awareness: Many workers are unaware of
their rights under the Act.
Interstate Disparities: Variations in minimum wage
rates across states lead to inconsistencies.
Enforcement Mechanism: Limited resources and
personnel hinder effective enforcement.
Constitutional Validity
The Act's constitutionality was challenged in Bijay
Cotton Mills Ltd. vs. State of Ajmer, where it was
argued that it violated Article 19(1)(g) (freedom to
practice any profession). The Supreme Court upheld
the Act, stating that the restrictions were reasonable
and aimed at achieving social justice, aligning with
Article 43 of the Constitution.
🔄 Recent Developments
The Code on Wages, 2019 has subsumed the Minimum
Wages Act, 1948, along with three other labor laws, to
streamline and simplify wage-related legislation. The
Code aims to universalize the provisions of minimum
wages and timely payment of wages to all employees,
irrespective of the sector.
📝 Conclusion
The Minimum Wages Act, 1948, has played a pivotal
role in protecting workers' rights and ensuring fair
compensation. While challenges in implementation
persist, the Act laid the foundation for labor welfare in
India. The transition to the Code on Wages, 2019,
reflects the government's commitment to evolving
labor laws to meet contemporary needs.
