NDA govt set to clear proposal for minimum pay for some employees

Representative Image: (REUTERS/Rupak De Chowdhuri)

The Union Cabinet is set to approve the code on wages which proposes making minimum wages a right for 'scheduled employees', the Financial Express reported.

"The final bill on labour code on wages, after being cleared by the interministerial group, has been sent to the Cabinet yesterday (Monday). The effort will be to introduce it in the upcoming monsoon session of the Parliament," Labour minister Dattatreya told ET.

Minimum wages is currently applicable to only 51 ‘scheduled employments’. Scheduled employment, in India, means an employment specified in the schedule adjoining the Minimum Wages Act, 1948, according to the National Informatics Centre and Indian Labour Bureau.

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The code, scheduled to be approved today, will combine the provisions of four existing Acts - the Minimum Wages Act, 1948, The Payment of Wages Act, 1936, The Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976.

The Act will enable the Centre to apply a ‘national minimum wage’, meaning, below this limit, no state will be able to fix their minimum wage. This pay will be revised every two years, and if dearness allowance is included, then the pay will be revised every five years.

The passage of this reform will be the first such act amongst the four such long pending labour reforms. The government's labour reform initiative aims to merge 44 existing labour Acts into four codes – on industrial relations, wages, safety, social security, health conditions and working conditions.

The code on Industrial Relations has a series of proposals like allowing units, with more than 300 employees to lay off workers or close down without government approval, giving trade unions more representative powers. The code also seeks to bar outsiders from becoming office-bearers of unions in the organized sector, and reducing their influence in the unorganized sector.

The code will also define industrial strike afresh by including casual leave by 50 percent of more workers.

The proposed compilation of Labour Code on Security and Welfare (LCSW) has some confusing issues. According to the draft, many age-old schemes – including provident fund, insurance schemes, pension under the EPF Act (Employees’ Provident Funds And Miscellaneous Provisions Act, 1952) and the sickness benefit scheme under the ESIC (Employees' State Insurance Act, 1948) Act - will not exist in their present forms.