The Minimum Wage Act, 1948

The Indian Constitution has defined a 'living wage' that is the level of income for a worker
which will ensure a basic standard of living including good health, dignity, comfort,
education and provide for any contingency.
The Act provides for fixing wage rate (time, piece, guaranteed time, overtime) for any
industry that has at least 1000 workers.
The Objective of this act is to protect the interest of employees by fixing a minimum rate of
wages in certain industries. This act aims to prevent the exploitation of the workers & ensures
that they are pain the minimum wage.
This act covers workers who are employed in:
Woollen carpet making and shawl weaving
Rice Mill, Flour Mill or Dal Mill
Tabaco Factory
Construction and maintenance of Road & Buildings
Oil Mill
Local Authority
Stone braking or stone crushing
In Agriculture or any form of farming activity

Definition of Employment:
An employee is defined as a person who is employed for hire or is awarded in terms of
money to do any work (whether skilled or un-skilled), in scheduled employment in
respect of which minimum wage has to be paid.
This definition does not include any member of the armed forces of the Union, a
dismissed employee.

Definition of Wages:
Wage means all remuneration that can be expressed in terms of money, which would be
paid to the employed person in respect f his employment.
It does not include any remuneration paid by the employer towards PF or Pension.

Fixations and Revisions in the Act:
The Government holds the right to amend and make changes in the act, when it is
required. This Act may be reviewed by the Gov. on a regular interval, however, the
interval period does not exceed 5 years.
Revision of minimum wage rates is based on a 'cost of living index' and wages can be
fixed for an entire state, part of the state, class or classes and employments pertaining to
these categories.
The minimum wage rate is fixed by hour, Day by Day, by the week, by the month or any
other longer period.
The minimum wage rate may be different for
Different scheduled employees
Different employees in the same employment schedule
Different age groups
Different localities

As per Section 5 of the Minimum Wages Act, 1948, there are two ways of fixing and/or
revising minimum wages
Committee Method: Committees and Sub-committees are set up to make
recommendations or create inquiries.
Notification Method: The government publishes proposals and an official date in
the Official Gazette. All advice and recommendations form various committees
and sub-committees as well as representations are collected before the specified
official date and the government then proceeds to fix/revise minimum wages.
Rates of Overtime:
When a worker works in an employment for more than 9 hrs a day or more than 48 hrs a
week, then the worker is entitled to wage at double the ordinary wage rate. (Sec 14)