Policy

Govt working on proposal to raise minimum wages

PTI New Delhi | Updated on January 23, 2018 Published on August 11, 2015

Labourers pull an electricity cable to be laid underground along a roadside in Ahmedabad, India, May 27, 2015. India releases gross domestic product data on Friday that is expected to show the economy growing faster than China for a second consecutive quarter. Picture taken May 27. REUTERS/Shailesh Andrade

The government is working on a proposal to raise minimum wages of workers, a top Labour Ministry official today said.

“Discussion is on in the Ministry about increasing the minimum wages. Ultimately, we want to have a level of wages which is in conformity with the parameters suggested by the 2nd Labour Commission, Indian Labour Conference and erstwhile Planning Commission,” Labour Secretary Shankar Aggarwal told PTI.

However, Aggarwal said that the Ministry has not worked out the quantum of increase in the minimum wages as the proposal is still at a discussion stage.

Last month, the Centre had revised National Floor Level Minimum Wage (NFLMU) upwards from Rs 137 to Rs 160 per day with effect from July 1, 2015.

In order to have a uniform wage structure and to reduce the disparity in minimum wages across the country, National Floor Level Minimum Wage (NFLMU) is fixed and also requires to be revised from time to time on the basis of rise in Consumer Price Index for Industrial Workers (CPI—IW).

The NFLMU was last revised from Rs 115 to Rs 137 per day with effect from July 1, 2013.

The states also fix minimum wages to be paid by them to various categories of workers include unskilled, semi—skilled and skilled workers from time to time.

According to the Suresh Tendulkar methodology, the all—India poverty line in terms of consumption expenditure would amount to about 4,080 per month in villages and 5,000 per month in cities in 2011—12, which means that this is the bare minimum which was required for a family of five in 2011—12, to meet certain basic needs like calorie intake, health, and education among others.

The erstwhile Planning Commission has been following this methodology which factors in calorie intake, spending on education and health required for fixing a poverty line.

The Second National Labour Commission also said that there shall not be any linkage of wage with productivity as production and productivity are the results of many inputs like machines, capital, raw materials, land and others, of which labour is only one.

“Productivity is not merely labour productivity. So the commission shall recommend that no minimum wage to be linked with productivity and beyond minimum wages productivity shall be a subject for negotiation with Unions.”

Published on August 11, 2015
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