Introduction• Employee compensation is a vital part ofhuman resource management.• Wages, Salaries and other forms ofemployee compensation constitute avery large component of operating cost.• It is one of the biggest factorinfluencing industrial relations.
• It is means to attract and retainqualified and motivated employees.• It provides sense of recognition anddetermines their social status.• It is two type:– Base or Primary compensation– Supplementary Compensation
Acts Related to wages• India aims at rapid economic growth,industrial peace, price stability,equitable distribution of income andprogressively rising standard of livingfor the working class.• In order to realise these the govt: ofIndia regulates wage rates throughthe following methods
The Minimum Wages Act, 1948• The govt. realised that wages in “sweated” tradescannot be left to be determined on the basis offree play of demand and supply.• Therefore the govt. prescribes minimum rates ofwages in certain sweated or unorganisedemployments specified under The Minimum WagesAct.• The minimum wage can be fixed by hour, day,month or such other long period.
• The real aim of the Minimum wages Act isto prevent exploitation of labour throughpayment of unduly low wages.• But the implementation of the act is notsatisfactory.• Minimum wages have not been reviewedand revised for periods longer than fiveyears thereby leading to decline in realwages due to inflation.
The Payment of Wages Act 1936• The main object of the act is to ensureregular and prompt payment of wages andto prevent unauthorised deductions andarbitrary fines from wages. It alsoregulates the rate of payment forovertime work• The act is applicable to persons employedin factories/industrial establishments anddrawing less than the specified pay.
The Equal Remuneration Act1976• The main object of this act is to preventdiscrimination in remuneration on the basisof sex.• It is the duty of the employer to pay equalremuneration to men and women workersfor the same work or work of a similarnature.• No discrimination is to be made againstwomen in recruitment and in conditions ofservice.
Companies Act (Sec 529-A)• This Sec. aims to protect workers claimin the events of insolvency of theiremployer.• In case of winding up of a companyworker’s dues are to be paid in priorityall other debts in full.
The Industrial Disputes Act 1947• Under this act conciliation is compulsory inall wage disputes in public utility servicesand optimal in other industrialestablishments.• It also empowers the appropriate govt. toconstitute one or more industrial Tribunalor National tribunals and to refer a wagedispute to these Tribunals for adjudication
Key Points• Compensation• The Minimum Wages Act, 1948• The Payment of Wages Act 1936• The Equal Remuneration Act 1976• Companies Act (Sec 529-A)• The Industrial Disputes Act 1947