Wage code to replace all related laws

January 28, 2015 03:13 am | Updated 03:13 am IST - NEW DELHI

The government plans to introduce a “wage code,” that will replace Central laws pertaining to wage related matters and cover both the organised and the unorganised sectors.

Though the government had invited comments in July last year on the draft Minimum Wages (Amendment) Bill, 2013, which included setting a national minimum wage floor, the new “wage code” once finalised will subsume key laws, including the Minimum Wages Act 1948 and the proposed amendment.

“The wage code will set basic provisions related to payment of wages and bonuses. Once this is finalised, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976, will no longer be in place. The aim is to reduce the number of laws employers have to comply with,” a senior government official said. The details of the code were still being worked out.

The United Progressive Alliance (UPA) in 2012 as well as the NDA government last year had proposed a statutory National Floor Level Minimum Wage (NFLMW) which will make it binding for all State governments to pay the minimum wages specified for various economic activities.

The National Minimum Wages Act, 1948, lays down minimum wages for 45 listed economic activities. But since labour is a subject in the concurrent list, States can decide minimum wages for more than 1,600 economic activities. Wages paid to workers is frequently less than the specified rates. The Equal Remuneration Act, 1976 provides for equal wages for women and men workers for the same work.

The NFLMW was based on the 1991 recommendations of the National Commission on Rural Labour.

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