2. TABLE OF
CONTENT
• Introduction
• Objectives
• Legislative Framework
• Challenges
• Comparison of developing country
(India),underdeveloped country
(Myanmar),developed country(America)
• Real-life examples of legal
interpretations affecting wage fixation
• Researches
• Conclusion
3. INTRODUCTION
The legal framework for wage fixation in India
aims to ensure that workers receive fair and
equitable remuneration for their labor, while
also balancing the interests of employers and
the overall economic well-being of the country.
The Minimum Wages Act, 1948 and the
Payment of Wages Act, 1936 provide the
primary legal basis for wage determination, and
collective bargaining agreements supplement
these provisions in specific workplaces. The
Indian courts play a critical role in interpreting
and enforcing these laws, ensuring that the
rights of workers are protected.
4. Objectives of Wage Fixation
Policy
Economic Objectives:
• Promote economic growth: Fair and sustainable wages can help
to increase productivity and economic output.
• Maintain competitiveness: Competitive wages can help
businesses attract and retain skilled workers.
• Reduce poverty: Minimum wage laws can help to lift workers
out of poverty.
Social Objectives:
• Ensure fair wages: Wages should be sufficient to meet the basic
needs of workers and their families.
• Reduce income inequality: Wage policies can help to narrow
the gap between the rich and the poor.
• Promote social justice: Fair wages can help to create a more just
and equitable society.
5. Legislative
Framework
• Minimum Wages Act, 1948: sets
minimum wage standards for
scheduled employments.
• Payment of Wages
Act, 1936: regulates wage periods
and payment methods.
• Equal Remuneration
Act, 1976: ensures equal pay for
equal work regardless of gender.
6. Minimum Wages Act,
1948
The Minimum Wages Act, 1948 mandates the
fixation of minimum wages for all employees
engaged in certain scheduled employments.
The appropriate government, which can be
either the Central or the State government,
has the authority to fix minimum wages for
different categories of employees.
Key provisions of the Minimum Wages Act,
1948:
• Fixation of minimum wages.
• Review and revision of minimum wages.
• Monitoring and enforcement.
7. Payment of Wages Act, 1936
The Payment of Wages Act, 1936 regulates the
payment of wages to employees, including the
frequency of payment, the manner of payment,
and the deductions allowed from wages.
Key provisions of the Payment of Wages Act,
1936:
• Fixation of wage-periods.
• Payment of wages on working days.
• Mode of payment.
• Restrictions on deductions.
8. Challenges
LACK OF
REPRESENTATION: UNORGAN
IZED WORKERS OFTEN LACK
THE RESOURCES AND POWER
TO EFFECTIVELY NEGOTIATE
FAIR WAGES.
JUDICIAL ACTIVISM: COURTS
SOMETIMES INTERVENE TO
SET MINIMUM WAGES ABOVE
STATUTORY
LEVELS, CREATING
UNCERTAINTY AND LEGAL
BATTLES.
DATA GAPS AND LACK OF
TRANSPARENCY: RELIABLE
DATA ON WAGES AND COST
OF LIVING IS OFTEN
UNAVAILABLE, HINDERING
ACCURATE WAGE
DETERMINATION.
MULTIPLE WAGE FIXING
AUTHORITIES: CENTRAL AND
STATE
GOVERNMENTS, INDUSTRY-
SPECIFIC BOARDS, AND
COURTS OFTEN HAVE
OVERLAPPING
JURISDICTIONS, LEADING TO
CONFUSION AND
INCONSISTENCIES.
9. Comparison of Developing Country (India),Underdeveloped Country
(Myanmar),Developed Country(America)
Aspect India Myanmar United States (America)
Legal System Common Law Mixed legal system (based on English common law and local traditions) Common Law
Minimum Wage Laws
Exist, set by both central and state governments. Varies across states
and industries.
Exist, set by the government, but enforcement may be weak. Limited
coverage.
Exist at both federal and state levels. Varies by state and industry. Strictly
enforced.
Collective Bargaining
Permitted, but challenges exist in implementation. Collective
agreements are common.
Limited in practice. The government controls most aspects of labor relations.
Well-established. Protected under the National Labor Relations Act.
Common in unionized sectors.
Labor Courts/Tribunals
Exist to resolve labor disputes. Labor laws can be complex. Delays in
the legal process are common.
Exist, but access to justice may be limited. The legal system is
underdeveloped.
Exist to handle labor disputes efficiently. Generally, the legal process is
more streamlined.
Gender Pay Gap
Exists, with efforts to address it. Equal remuneration laws are in place.
Implementation varies.
Limited information, but gender inequalities persist. Weak legal frameworks
may contribute.
Exists, with ongoing efforts to address it. Equal Pay Act prohibits wage
discrimination based on gender.
Social Security Benefits
Comprehensive social security system in place, including provident
funds, pensions, and health insurance.
Limited social security infrastructure. Basic social security benefits may not
cover all workers.
Social Security system provides various benefits, including retirement,
disability, and healthcare.
Overtime Regulations
Defined by labor laws. Overtime pay is mandated for excess work
hours. Implementation varies.
Limited information. Overtime regulations may not be well-enforced.
Governed by federal and state laws. Overtime pay is mandatory for
eligible employees. Strictly enforced.
Work Hours
Standard workweek is 48 hours, with regulations on overtime. Varied
across industries.
Workweek and work hours may not be well-regulated. Informal labor may
not adhere to standard working hours.
Standard workweek is 40 hours. Overtime is regulated. Flexible work
arrangements are common.
10. Real-life examples of legal interpretations affecting wage fixation
Case: Air India Statutory Corporation vs. United
Labour Union (2012): The Supreme Court held
that employers cannot deduct any amount from
basic wages for services provided by employees
to the employer's customers. This
interpretation ensured that minimum wages
were paid without any deductions, impacting
the minimum income of various employees.
1
Case: The Indian Express Newspapers (Bombay)
Ltd. vs. The Workmen (1979): The Supreme
Court ruled that journalists are entitled to wage
increases based on the recommendations of the
Wage Board for Working Journalists and Non-
Journalist Newspaper Employees. This
interpretation specifically impacted the wages
of journalists across various publications.
2
11. Researches
Author(s) Title of Paper Key Findings
Singh, K. (2022) Minimum Wages in India: A Legal and Policy Analysis
- Minimum wage laws in India are complex and fragmented. - Implementation and
enforcement are weak, leading to widespread non-compliance. - There is a need for a
comprehensive review and reform of minimum wage laws.
Kumar, N. & Das, S. (2021)
Equal Pay for Equal Work: A Critical Analysis of the Legal
Framework in India
- The principle of equal pay for equal work is enshrined in the Indian Constitution. -
However, there are significant gaps between the legal framework and reality. - Gender pay
discrimination is widespread and persistent.
Sharma, A. (2020) The Role of Collective Bargaining in Wage Fixation in India
- Collective bargaining is a key mechanism for wage determination in India. - However, its
effectiveness is limited by low unionization rates and weak bargaining power of workers. -
There is a need to strengthen the legal framework for collective bargaining.
Gupta, S. (2019)
Judicial Interpretation of Minimum Wages in India: A Case
Study
- The judiciary has played a crucial role in interpreting and enforcing minimum wage laws. -
However, judicial pronouncements have often been inconsistent and contradictory. - There
is a need for greater clarity and consistency in judicial interpretations.
Dasgupta, R. (2018)
The Informal Sector and the Minimum Wage: A Challenge for
Wage Fixation in India
- The informal sector accounts for a large proportion of the Indian workforce. - Minimum
wage laws are not applicable to most informal sector workers. - This creates a significant
challenge for wage fixation in India.
Rao, M. & Reddy, S. (2017)
Wage Fixation for Public Sector Employees in India: A
Comparative Study
- The process of wage fixation for public sector employees in India is highly centralized and
bureaucratic. - This has led to dissatisfaction among employees and calls for greater
transparency and accountability. - A comparative study of wage fixation practices in other
countries could provide valuable insights for reform.
Singh, V. (2016) The Role of Wage Boards in Wage Fixation in India
- Wage boards are tripartite bodies that play a key role in wage fixation for specific
industries in India. - However, their effectiveness has been questioned due to political
interference and lack of transparency. - There is a need to reform the wage board system to
make it more efficient and effective.
12. Conclusion
Wage fixation in India faces significant
challenges in legal interpretation and
implementation. Addressing these
challenges requires a multi-pronged
approach involving legislative reform,
strengthening enforcement mechanisms,
promoting awareness among workers,
formalizing the informal sector, and
improving data collection and
transparency. By addressing these
challenges, India can move towards a fair
and just wage system that protects the
rights of all workers.
