Government undecided on Minimum Wage

While the Rajya Sabha has passed the Wage Code Bill which aims to enforce a strict minimum wage limit for both the informal and formal sectors, the concerned Ministry (the Labour Ministry) has informed the house that the government to yet to decide on a minimum wage for all.

What is happening?

  • The bill new Wage Code bill aims to replace four existing bills which were concerned with the worker payments.
  • These were the Payment of Wages Act (1936), Minimum Wages Act (1948), Payment of Bonus Act (1965) and Equal Remuneration Act (1976).
  • The Code on Wage Bills has included the provisions of minimum wages for both the formal & informal sectors of the economy.
  • It aims to ensure that their Right to Sustenance for every worker employed in this nation.
  • If the bill is passed, it will increase the legislative protection cover of minimum wage from 40% (currently) to the entire workforce.
  • The new bill also proposes to introduce of regulated minimum Floor Wage.
  • This will be calculated based on the minimum living conditions needed for a dignified living.
  • The current number of minimum wages in the country is over 2,000 and the bill seeks to homogenize this.
  • The bill also explores the provision of replacing cash payments with digital payments.

What happens now?

The Minimum wage will be decided after deliberations with the Tripartite Minimum Wage Advisory Board. However, as per the provisions defined in the bill,? the recommendations of the board will not be binding on the government and it is free to choose a minimum wage of its own.


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