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The minimum wages act, 1948 (2)

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min wage act.. bare act + recent amendments + milestone cases

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The minimum wages act, 1948 (2)

  1. 1. Team membersNames ParticularsShweta Pagedar (Roll No. 27) Objectives of Act Historical Backdrop Broad Features Who all are eligible Sec. 1, 2, 3, 4 SegregationJaymeen Bhalgamadia (Roll No. 02) Sec. 5, 7-14, 17, 18, 20, 22, 25, 27-29,Lalit Bourasi (Roll No. 05) State Amendments, Recent Cases
  2. 2.  To provide minimum wages to the workers working in organized sector To stop exploitation of the workers To empower the government to take steps for fixing minimum wages and to revising it in a timely manner To apply this law on most of the sections in organized sector (scheduled employment)
  3. 3. Historical Backdrop The initiative by Shri K.G.R.Choudhary in 1920: set up boards for determination of wages The International Labour Conference adopted convention 26 and 30 in 1928 relating to wage fixing machinery in trades or parts of trades A Minimum Wages Bill was introduced in the Central Legislative Assembly on 11.4.46 and came into force with effect from 15.3.48 The Committee on Fair Wage was set up in 1948 to provide guidelines for wage structure
  4. 4. Broad Features of the Act [Sec 3]: The Act lays down the principles for fixation of  A minimum time rate of wages  A minimum piece rate  A guaranteed time rate  An overtime rate for different occupations, localities or classes of work and for adults, adolescents, children and apprentices [Sec 4]: The minimum wages may consist of  A basic rate of wages and a cost of living of allowances  A basic rate of wages with or without the cost of living allowance and the cash value of the concessions in respect of essential commodities supplied at concessional rates
  5. 5. Short Title and Extent[Sec. 1] This Act, the Minimum Wages Act, 1948 extends to the whole of India This Act may be called the Minimum Wages Act, 1948
  6. 6. Who all are eligible? Permanent employees Contract employees Casual workers People on probation get fixed pay instead of minimum wages. Trainees get stipend and not minimum wages
  7. 7. What is appropriategovernment? [Sec 2(b)]In relation to scheduled employment carried on by Central Government or railways or est. under Central Act, the Central GovernmentIn all other cases – the State Government 8
  8. 8. Wages [Sec. 2(h)] Minimum wages: all remuneration capable of being paid in money terms for work done if terms of contract were fulfilled consist of Basic + Dearness Allowance + House Rent Allowance Every 5 years, basic rates of every industry are decided by Minimum Wages Committee Dearness Allowance changes every six months and is decided by Government
  9. 9. Other DefinitionsSection No. Term2 (bb) Child2 (a) Adolescent2 (aa) Adult2 (c) Competent authority2 (d) Cost of Living Index Number2 (e) Employer2 (g) Scheduled Employment2 (i) Employee
  10. 10. Fixing of minimum rate ofwages [Sec. 3]The Appropriate Government: Shall fix minimum rates of wages for an employment specified in Part I or Part II of Schedule & added by notification in official gazette May fix rates for a part of the state or for any specific class or classes instead of fixing minimum rate of wages for whole state Shall review and revise at intervals not exceeding 5 years the minimum rates of wages
  11. 11. Different Minimum WagesMay Be Fixed By TheGovernment For: Different employments (specified in the schedule) Different classes (e.g. skilled, unskilled, semis skilled, etc.) of work in the same employments Adults, adolescents, children and apprentices Different localities
  12. 12. Minimum rates of wages may be fixed by any one or moreof the following wage periods, namely: By the hour By the day By the month By such other larger wage periodas may be prescribed; and where such rates are fixed bythe day or by the month, the manner of calculating wagesfor a month or for a day, as the case may be, may beindicated
  13. 13. Different Minimum Wages May BeFixed By The Government Mayconsist of [Sec. 4]1. Basic + Special Allowance (Which varies with the cost of living index)2. Basic + Cash value of concessional supply of materials like food, clothes, etc3. An all inclusive rate which includes Basic + Cost of living Allowance + Cash value of concessional supply of materials
  14. 14. Fixing Minimum Rates ofWages [Sec. 5] Publish its proposals in the official gazette asking comments from the affected parties Constitute committees/sub committees for the purpose. The committees/sub-committees and advisory boards constituted by the Government consist of equal number of members of :  Employers  Employees, and  Independent persons
  15. 15. Fixation of minimum wagesRecommendation of Advisory Board for different class[unskilled, skilled, Clerk, Supervisor]Publish recommendations in National Publications [for publiccomments/representations from Trade Unions etc.]Hearing of the Representatives etcNotification of Minimum wages
  16. 16.  Appointed by appropriate government To co-ordinate the work of committees and sub committees appointed under Section 5 To advise the Central and State Governments in fixation and revision of minimum rates of wages To co-ordinate the work of the Advisory Boards
  17. 17. Composition ofCommittees, etc.[Sec. 9] Each of the committee, sub-committee and the Advisory Board shall consist of:a. persons to be nominated by the appropriate Governmentb. representing the employers and employees in the scheduled employments who shall be equal in number andc. independent persons not exceeding one-third of its total number of members: one of such independent persons shall be appointed the Chairman by the appropriate Government.
  18. 18. Correction of Errors[Sec. 10] By appropriate Government at any time By notification in the Official Gazette Correct clerical or arithmetical mistakes or errors arising from and accidental slip or omission. Every such notification shall be placed before the Advisory Board for information.
  19. 19. Wages in Kind [Sec. 11] Minimum wages shall be paid in cash. The appropriate govt. may authorize, where there has been a custom of payment in this manner, payment of minimum wages either wholly or partly in kind The appropriate govt. may authorize supply of essential commodities at concessional rates
  20. 20. Payment of minimum rateof wages [Sec. 12] The Minimum Wages has to be paid without any deductions other than Statutory Deductions. Payment of wages less than minimum wages on the ground of less performance or output is illegal
  21. 21. Normal working hours[Sec. 13]For an Adult Worker working in Factories: Number of Working Hours should not exceed 48 Hours in a week with a weekly Holiday The Daily Hours should not exceed more than 9 Hours with 1 Hour Rest Interval Provision of Compensatory Holiday/ Overtime Wages if working on holiday
  22. 22. Overtime wages [Sec. 14]  If the person has worked for more than 48 hours in a week then, the excess hours worked will be treated as Overtime  Overtime wage rate will be twice of the normal wage rateWages for a person who has worked lessthan normal working hours [Sec. 15] Employer could not provide the activities of the job then, the employee is entitled to receive full salary Employee has not worked due to his unwillingness then, the employee is not entitled to receive full salary
  23. 23. Records to be maintained[sec. 18] The Registers should contain the following particulars- (i) particulars of employed persons (ii) the work performed by them (iii) the wages paid to them (iv) the receipts given by them
  24. 24. Claims [Sec. 20] A Labour Commissioner or any other appointed authority is authorized to hear claims regarding non-payment of minimum wages Any aggrieved person may apply to the authority for settling his claims within 6 months
  25. 25. Penalties [Sec. 22] Offence PunishmentPayment of less than Imprisonment which mayMinimum Wages to extend up to 6 Months oremployee Fine which may extend up to Rs 500/- or Both
  26. 26. Contracting out [Sec. 25] Any contract or agreement, whether made before or after the commencement of this Act, whereby an employee either relinquishes or reduces his right to a minimum rate of wages or any privilege or concession accruing to him under this Act shall be null and void so far as it purports to reduce the minimum rate of wages fixed under this Act.
  27. 27. Power of State Government to addschedule [Sec. 27]The State Government has to notify in theOfficial Gazette not less than threemonths of its intention to do soPower of Central Government togive directions [Sec. 28]The Central Government may give directionsto a State Government as to the carryinginto execution of this Act in the State.
  28. 28. Power of the CentralGovernment to make rules[Sec. 29] Procedure to be followed in conduct of business Method of voting Manner of filling of casual vacancies in membership Quorum necessary for the transaction of business of the Central Advisory Board.
  29. 29. State Amendments - Gujarat Section 3(2) Prevent the State Government from fixing the minimum rates of wages in respect of such employment even after the expiry of the said period of one year.
  30. 30.  "21A Liability for payment of Court-fees.- section 20 the applicant shall not be liable to pay any court-fees presented by an Inspector- he shall not be liable to pay the process fees also. sub-section (1), under section 12 to pay the amount to the State Government. prejudice to any other mode of recovery, be recoverable as an arrear of land revenue."
  31. 31. Recent State amendments Based on the recommendations of the Minimum Wages Advisory Board (MWAB) in its meeting held on 22.01.2008 and 26.06.2008: “Employment of Watch and Ward” The rates has been prescribed by the central. Construction and Loading and Unloading” Non-Coal Mines- in the Central sphere
  32. 32.  Ajay Bansal vs. State, 2007 LLR 1040 (Del He) Violation of Section 22-A of the Minimum Wages Act Assistant Labour Commissioner filed a case for not paying the minimum wages to the employees Defendant argued that the establishment namely, petrol pump is not covered by the provisions of the Act H.C. held that Petrol Pump covers under the establishment and the employees will be entitled to minimum wages.
  33. 33.  Andhra Pradesh Vyavasaya Vruthidarula Union (APVVU) had filed a Public Interest Litigation (PIL) with the High Court of AP challenging the central government NRGEA wages notification which is the clear violation of Minimum Wages Act of AP, Advocate Bala Gopal argued the case. As per the Minimum Wages Act 1948, the wages has to be revised once in every 3 years The government of AP has revised the minimum wages in year 2002. The next revision should have been in the year 2005. On 3rd July, 2009, the High Court passed the Judgment in favor to pay minimum wages as per the Minimum Wages revised by AP government.
  34. 34. Recent Cases: Executive Engineer, Rural Works Division, Mayurbhanj vs. Addl. District Magistrate, Mayurbhanj, 2005 LLR 121 (Ori HC), it was held that, under the Minimum Wages Act, it is the liability of principal employer to pay difference of wages to the employees of the contractor. President Cinema Workers Union Affiliated to Bharatiya Mazdoor Sangh vs. The Secretary Social Welfare and Labor Department, 2005 LLR 648 (Karn He), it was held that inaction on the part of the Government in not revising minimum wages for 13 years will not be justified hence revision be made within 6 months.
  35. 35. Cases (contd.) Delhi Council for Child Welfare v. Sheela Devi, 2006 LLR 1181 (Del He), it was held that A Society is liable to pay minimum wages to its employees. Birla Institute of Technology vs. State of Bihar, 2007 LLR (SN) 330, it was held that Birla Institute of Technology will be liable to pay the wages as per The Minimum Wages Act, 1948. Agricultural Produce Market Committee vs. Weighmens Association, Tiptur, 2007 LLR (SN) 333 (Kam He). It was held that in the absence of relationship of master and servant, the weigh men will not be entitled to minimum wages.
  36. 36. Cases (contd.) Sonu vs. Municipal Corporation of Delhi, 2005 LLR 778 (Del He), it was held that Minimum wages to the safai karamcharis cannot be denied on the ground that they work on part-time basis. Lingegowd Detective & Security Chamber Pvt. Ltd. vs. Mysore KirloskJIr Ltd., (2006) ( (SC), it was held that private security guards through contractor will not be entitled to minimum wages in the absence of scheduled employment.
  37. 37. To sum up…..• Effective implementation of the Minimum Wages Act,1948, which primarily falls in the State sphere, is assiduously pursued by Ministry of Labour and Employment through:• discussion,• writing letters,• personal interaction and visits to states. The State Governments are regularly asked to fix and revise minimum wages in scheduled employments to be at least at par with national floor level minimum wages.
  38. 38. List of some important forms…Form No. Rule DescriptionIII 21 (4a) Annual ReturnV 26 (5) Muster RollX 26 (1) Register of WagesXI 26 (2) Wage slip
  39. 39. Sources: _a/mwaNSections.htm#mwa_1 citizen/miniwage_form.htm The Minimum Wages Act, 1948(Act number XI of 1948), S.B.D Publications, 2nd edition, 2009-10. Industrial and Labour Laws, S P. Jain, 2008 edition, Dhanpat Rai & Co. (P) Ltd. Dynamics Of Industrial Relations, Dr.Satish Mamoria, Late Dr.C.B.Mamoria, S V. Gankar, Himalaya publications, 13th edition, 2011.
  40. 40. Resource Persons: Mr. Sudhir Shah, B.Sc. L.L.B, Advocate Mangesh Thite, Sr. Executive, IR (FAG Bearings, India Ltd.) Dharmesh Parikh, Deputy General Manager, IR, (FAG Bearings, India Ltd.)