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Notes from AM VI
The Code of Wages, 2019 includes:
i. The Payment of Wages Act, 1936 ii. The Minimum Wages Act, 1948 iii. The Payment of Bonus Act, 1965 iv. The Equal Remuneration Act, 1976
The object behind codification of the act
The Code on Wages shall regulate wage and bonus payments in all employments and aims at providing equal remuneration to employees performing work of a similar nature in every industry, trade, business, or manufacture. The Code on Wages also aims to transform old and obsolete labour laws, some of which were enacted in the pre-Independence era and meant primarily for factories and industrial establishments, into a more accountable and transparent law.
Its coverage and applicability includes:
a. The Code on Wages will apply to employees in the organised and un-organised sectors. While the Central Government will continue making wage- related decisions for employments such as railways, mines, oil fields, central public sector undertaking etc., the State Governments shall make such decisions for all other employments including for private sector establishments. b. Unlike the Payment Of Wages Act which applied to only those employees who drew monthly wages of up to INR 24,000 and the Minimum Wages Act which applied only to scheduled employments, the provisions of the Code on Wages relating to payment of wages shall extend to all employees irrespective of their wage ceiling and type of employment.
The key features of the Act are:
1. The Code on Wages comprises of 9 chapters. 2. While the applicability, coverage, definitions and provisions mandating equal remuneration are listed out in Chapter I, Chapter II contains provisions relating to payment of minimum wages. 3. Chapter III deals with 'Payment of Wages'. 4. Chapter IV deals with 'Payment of Bonus'. 5. Chapter V provides for constitution of an Advisory Board. 6. Chapter VI deals with the manner of raising claims under the Code on Wages. 7. Chapter VII provides for the appointment of an Inspector cum Facilitator. 8. Chapter VIII lists out the offences and penalties. 9. Chapter IX lists down the miscellaneous provisions.
The concept of ‘Floor Wage’
The Central Government has been tasked with fixing a floor wage a new concept being introduced by the Code on Wages, after taking into account the minimum living standards of workers and depending on the geographical areas. Basis the floor wage rate and consistent with the Minimum Wages Act, the appropriate government (Central or State) shall fix the minimum rate of wages payable to employees. The minimum wages prescribed by the appropriate governments cannot be lesser than the floor wage. In the event that the existing minimum wages fixed by the Central or State Governments are higher than the floor wage, they cannot reduce the minimum wages. The minimum rate of wages shall be reviewed and revised in intervals not exceeding five years.
