2. MINIMUM WAGES
• minimum living cost
• minimum level of subsistence, which includes
food, clothing and shelter
• fixed by the government in consultation with
business organizations and trade unions
• Under Minimum Wages Act, 1948, under
which farm laborers to b e paid a minimum
wage between 66 paise and rs. 1.50/- dsy.
3. The Benefits as follows:
• These laws prevent unscrupulous employers from exploiting
ignorant persons who possess very little bargaining power.
• These abolish the competition of the lower strata of workers
with the upper grades and tend to prevent depressing of
• The productivity of industry is increased by foreign employers
to use the most efficient production methods and the most
modern equipment, in order to enable employees to earn the
living wage. But at the same time, the workers are stimulated
to increase his efficiency in order to hold his job.
• Employers with high standards are protected against
underselling by competitors with low standards.
4. FAIR WAGES
• more than the minimum wages
• mean between the living wage and the
• the upper limit is the capacity of the industry
to pay fair wage compares reasonably with
the average payment of similar task in other
trades or occupations requiring the same
amount of ability
• Fair wage depends on the present economic
position as well as on its future prospects
5. The fair wages depends upon the
(1) Minimum Wages
(2) Capacity of the industry to pay
(3) Prevailing rates of wages in the same or similar
occupations in the same or neighboring localities
(4) Productivity of labour
(5) Level of national income and its distribution.
(6) The place of the industry in the economy of the
6. • Living wages has been defined differently by
different people in different countries
• Justice Higgins which reads "Living wage is a
wage sufficient to ensure the workman food,
shelter, clothing, frugal comfort, provision for
evil days etc. as regard for the skill of an
artisan, if he is one.
7. • According to Fair Wages Committee Report: "The
living wage should enable the male earner to
provide himself and his family not merely the basic
essentials of food, clothing and shelter but a
measure of frugal comfort including education for
the children, protection against ill-health,
requirement of essential social needs and measures
of insurance against old age."
• Article 43 of the Constitution of India states that the
state shall endeavor to secure by suitable legislation
or economic organization or in any other way to all
workers a living wage, conditions of work ensuring a
decent standard of life and full enjoyment of
pleasure and social and cultural opportunities.
8. COMPENSATION PHILOSOPHIES
• Entitlement Philosophy
Assumes that individuals who have worked another year
are entitled to pay increases, with little regard for
• Pay-for-Performance Philosophy
Requires that compensation changes reflect individual