Differences within expert group on minimum wages over methodology

Attempts by the expert committee on minimum wages, headed by eminent statistician and economist SP Mukherjee, to change the existing methodology based on nutritional requirement to fix the minimum wages to Multi Criteria Decision Making (MCDM) method, are facing opposition from members within the panel. Most of the members are learnt to have suggested that the panel should continue to consider consumption pattern and nutritional intakes as the main criteria for deciding the national minimum wages and floor wages. The next meeting of the panel scheduled in May will finalise the methodology.

Decision based on NSSO data

A member of the panel told BusinessLine that they will finalise a methodology based on the expert analysis of consumer expenditure data compiled by the NSSO, taking into account of the living conditions of workers. A member of the panel has been entrusted with carrying out the computational activities of the data. The next meeting will be held after the completion of that task of examining the NSSO data on consumer expenditure and to find out the food expenditure in particular. “We will find out how much a household with one worker spend on food and their quantity of calorie intake,” the member added.

When contacted, Mukherjee said he will once again suggest a methodology based on MCDM. “If other members do not agree, I will have to withdraw,” he said. Mukerjee had earlier made a presentation on the MCDM before Union Labour Minister Bhupender Yadav and he said the Minister was impressed by the methodology.

Two years ago, a report submitted by Anoop Satpathy used a tool based on “demographic structure, consumption pattern and nutritional intakes, the composition of food baskets and the relative importance of non-food consumption items to address the realities in the Indian context by using official data made available by the National Sample Survey Office (NSSO)”.

Members not convinced

A member said not many members are convinced about the need to change the present methodology to MCDM. They are not really accustomed to this idea. Within the group also, not many members are really convinced about the need for adopting this. Most people go by the well-trodden path of calculations based on NSSO data, finding out consumer expenditure etc and considering the workers as the only stakeholder group,” the member said.

Mukherjee has been arguing that MCDM model will take care of the points of different stakeholder groups. “Workers are not the only stakeholder group. The employers, particularly in the informal sector and the government and the administration should also be considered as stakeholders and must be consulted in the process,” he said.

Trade Unions had questioned Mukherjee’s intentions. “He (Mukherjee) won’t bother about Indian Labour Conference (ILC) recommendations and the Supreme Court judgment, which together has been comprehensively reiterated the 45th ILC (2013) and 46th ILC; the same comprehensive formulations were solemnly incorporated in the draft Rules to the Code On Wages, 2019. This makes clear the intention behind the very act of constitution of the expert group in bulldosing the scientific calorie and essential expenditure-based formula for fixing minimum wage, as unanimously recommended by the highest tripartite forum in the country—the ILC, in order to inject ‘business’s perspective’ in the entire exercise of fixation of minimum wage and its floor level,” CITU general secretary Tapan Sen had said in a recent letter to Yadav.

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