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minimum wage in India: Govt to set up advisory board to determine national minimum wage


The labour ministry has notified setting up the central advisory board for determining national floor level minimum wage, thus implementing a part of the Code on Wages even as the entire code is expected to come into force from April next year. Further, states can also form their respective advisory boards to kick-start the process of wage determination.

“In exercise of the powers conferred under the Code on Wages, 2019, the Central Government hereby appoints the date of publication of this notification as the date on which the following provisions of the said Code shall come into force,” labour ministry said in a gazette notification

The provisions which will come into force immediately include the sub-sections (1), (2), (3), (10) and (11) of section 42 which allows the government to constitute the Central Advisory Board and among others including allowing states to set up similar boards and the procedures for setting them up.

ET had reported last week that the government was contemplating notifying at least three central boards mooted across Code on Wages, the Social Security Code and the Code on Occupational Safety, Health and Working Conditions. The other two boards which could be formed ahead of the full code being implemented include the national social security board and the national occupational safety and health advisory board.

Government is of the view that constituting such boards in advance will help in smooth roll-out of the entire Codes from April 1, 2020. The national floor level minimum wage, to be determined by the Board, will be statutory and would mean that no states can have their minimum wage less than the floor wage. The current floor wage is only advisory as a result of which in certain minimum states minimum wages are less than floor wage which is pegged at Rs 176 per day.

The Central Advisory Board will be responsible for fixation or revision of minimum wages and other connected matters, provide for increasing employment opportunities for women, determine the extent to which women may be employed in such establishments or employments as the Central Government may, by notification, specify in this behalf; and any other matter relating to this Code.

The Board will comprise government nominated representatives of the employers and employees in equal numbers, independent persons, not exceeding one-third of the total members of the Board and five representatives of such state governments as may be nominated by the Central Government.

The earlier panel set on national floor level minimum wage in 2018 had suggested a single value of the national minimum wage for India of Rs 375 per day. It had also suggested a minimum monthly wage of Rs 9,750 and a housing allowance of Rs 1,430 for city-based workers. However, this was too high compared to the existing rate and hence has not been accepted by the government till date.

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