The Minimum Wages Act, 1948


Wages means all remuneration capable of being expressed in terms of money, which Would, if the terms of contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such. Employment it includes house rent allowance but does not include the value of any house accommodation, supply or light, water, medical attendance or other amenity or service excluded by general or special order of appropriate Government; contribution paid by the employer to Pension/ Provident Fund or under scheme of social insurance; traveling allowance or value of traveling concession; sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or any gratuity payable on discharge.

As of now there is no uniform and comprehensive wage policy for all sectors of the economy in India. Wages in the organized sector are determined through negotiations and settlements between employer and employees. In unorganized sector, where labor is vulnerable to exploitation, due to illiteracy and having no effective bargaining power, minimum rates of wages are fixed/ revised both by Central and State Governments in the scheduled employments falling under their respective jurisdictions under the revisions of the Minimum Wages Act,1948.

The concept of Minimum Wages was first Evolved by ILO in 1928 with reference to Remuneration of workers in those industries Where the, level of wages was substantially Low and the labor was vulnerable to Exploitation, being not well organized and Having less effective bargaining power. The Need for a legislation for fixation of minimum Wages in India received boost after World War — II when a draft bill was considered by The Indian Labor Conference in 1945.

On the recommendation of the 8th Standing Labor Committee, the Minimum Wages Bill was introduced in the Central Legislative assembly on 11.4.1946 to provide for fixation of minimum wages in certain Employments. The Minimum Wages Bill was passed by The Indian Dominion Legislature and came into Force on 15th March, 1948. Under the Act both State and Central Government are “Appropriate Governments” for fixation/revision of minimum Rates of wages for employments covered by The Schedule to the Act. The Central Government is responsible for fixation and revision of minimum wages for the unskilled workers in scheduled employments of Central Sphere Scheduled Employments of Central Sphere are given in

The minimum rates of wages also include Special Allowance (Variable Dearness Allowance) linked to Consumer Price Index Number which are revised twice a year effective from April and October. The rates of minimum wages including VDA in different scheduled employments in Central Sphere are at

The rates of wages once fixed are revised at an interval not exceeding of five years. The minimum wages were last revised in 1994, under Central sphere. The minimum wages in various mines as well as constructions, laying of underground cables etc. in the central sphere have been revised vide gazette notifications S.O. no. 9(E) dated 3.1.2002 and S.O. no. 113(E) dated 28.1.2002respectively.

National Minimum Wage:

The National Minimum Wage has been considered at various fora in the past. However, State/UT Governments are not unanimous on the need of a National Minimum Wage as socioeconomic conditions vary from state to state, region to region and also from industry to industry due to different geographical, topographical and agro-climatic factors. Pending easibility of a National Minimum Wage, the desirability of a regional minimum wage has been felt to bring in regional uniformity.

The Six Regional Minimum Wages Advisory Committees set up in 1987 to reduce regional disparities among States have been broadened and renamed as Regional Labour Ministers’ Conferences.

The 28th Indian Labour Conference in 1985 recommended a national basic subsistence level wage below which no wages may be fixed regardless of the nature of work, nature of employment and other considerations. In the absence of uniformity in minimum wages the Central Government adopted the concept of national floor level minimum wage and fixed it at Rs,35/- per day in 1996, based on the recommendation of the National Commission on Labour in 1991 and subsequent increase at the price level.

The Central Government raised the national floor level minimum wage to Rs.40/- per day in 1998 and further to Rs.45/- w.e.f. 30.11.1999, keeping in view the rise in consumer price index. All the State/UT Governments were also directed to ensure fixation of minimum rates of wages in all the scheduled employments not below Rs.45/- per day.

Enforcement of Minimum Wages:

Minimum Wages under Central sphere are enforced through Central Industrial Relations Machinery (CIRM).   Presents cases of enforcement by CIRM. Under State sphere the enforcement is ensured by the State machinery Central Board for Workers Education gives wide publicity of provisions of Minimum Wages Act, besides other awareness programmes through mass media Industry -wise special studies on implementation of minimum wages are conducted by Labour Bureau. 5.19 Consumer Price Index determines changes in commodity cost and changes in cost of living of the workers. The index is used in determining VDA Separate baskets of goods and services are used for compilation of consumer Price Index for Industrial,   gricultural and Rural Workers.

The Consumer Price Index for Industrial workers (base 1982) and Agricultural & Rural Labourers (Base 1986-87) are compiled on the basis of price data collected from specified markets The yearly variation in Consumer Price Index for Industrial Workers and Agricultural Labourers are presented from 1984-85 onwards.


The object of the Act is to prevent exploitation of labour; prevent employment of sweated labour in the interests of general public and so in prescribing minimum wage rates, the capacity of the employer need not be taken into account.


The Act is applicable in respect of the employments specified in the schedule of the Act. Presently, the Punjab Government has notified 67 employments in the said Schedule.

Responsibility of the Employer:

An employer of the scheduled employment is required to pay the minimum wages to its employees as notified by the government from time to time. He is also required to maintain registers regarding registers of wages, fines, deductions for damage or loss and overtime. He is also required to send annual return to the Inspector for the year ending on 31st December by 1st of February next year.


A worker can made a complaint with regard to payment of less than the minimum wages or unauthorized deductions made to the Labour Inspector Grade-I or II of the area.


A claim application in duplicate can be made in Form VI by an employee; in Form — VI-A by a group of employees; in Form — VII by an Inspector or person permitted by the Authority u/s 20 for claiming the difference of minimum wage and the wages actually paid, or for claim wages for weekly offs or rest days or for wages at the over-time rate. The application should be presented to the Competent Authority appointed under the Act i.e. the Assistant Labour Commissioner or the Labour-cum-Conciliation Officer of the concerned area.

Bar to Suit:

Civil Courts are barred to entertain the suit for recovery of wages once a claim has been lodged with or could have been recovered by application to the Competent Authority under the Act.

Contracting out:

Any contract or agreement whereby a worker relinquishes or reduce his right to receive minimum wages is null and void to that extent.


For non compliance of the provisions of the Act, an employer may be punished for imprisonment up to six months or fine up to Rs. 500/- or both.


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