Wednesday, November 6, 2019

Calculating the minimum rate of wages Central Government Code on Wages 2019

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Calculating the minimum rate of wages Central Government Code on Wages 2019

Government of India
Ministry of Labour and Employment


Manner of calculating the minimum rate of wages (1) For the purposes of sub-section (5) of section 6, the minimum rate of wages shall be fixed on the day basis keeping in view the following criteria, namely:-
  • the standard working class family which includes a spouse and two children apart from the earning worker; an equivalent of three adult consumption units;
  • a net intake of 2700 calories per day per consumption unit;
  • 66 meters cloth per year per standard working class family;
  • housing rent expenditure to constitute 10 per cent. of food and clothing expenditure;
  • fuel, electricity and other miscellaneous items of expenditure to constitute 20 percent of minimum wage; and
  • expenditure for children education, medical requirement, recreation and expenditure on contingencies to constitute 25 percent of minimum wages;
(2) When the rate of wages for a day is fixed, then, such amount shall be divided by eight for fixing the rate of wages for an hour and multiplied by twenty six for fixing the rate of wages for a month and in such division and multiplication the factors of one-half and more than one-half shall be rounded as next figure and the factors less than one-half shall be ignored.

Also check: Variable Dearness Allowance - Minimum Wages effect from 1.4.2019 - Chief Labour Commissioner (Central) Orders

Norms for fixation of minimum rate of wages (1) While fixing the minimum rate of wages under section 6, the Central Government shall divide the concern geographical area into three categories, that is to say the metropolitan area, non-metropolitan area and the rural area.

(2) The Central Government shall constitute a technical committee under clause (a) of sub-section (1) of section 8 for the purpose of advising the Central Government in respect of skill categorization, which shall consist of the following members, namely :-
  • Chief Labour Commissioner (Central) ………………… Chairperson;
  • Joint Secretary to the Government of India dealing with the wages …………… member;
  • a representative from the Government of India, Ministry dealing with skill development;
  • Director General of employment, Government of India, Ministry of Labour and Employment ………………. member;
  • two technical experts in wage determination as nominated by Central Government …………………… member; and
  • the Deputy Secretary to the Government of India, Member Secretary of such technical committee.
(3) The Central Government shall, on the advice of the technical committee referred to in sub-rule (2), categorize the occupations of the employees into four categories that is to say unskilled, semi-skilled, skilled and highly skilled by modifying, deleting or adding any entry in the categorization of such occupation specified in Schedule E.

(4) The technical committee referred in sub-rule (2) shall while advising the Central Government under sub-rule (3) take into account, to the possible extent, the national classification of occupation or national skills qualification frame work or other similar frame work for the time being formulated to identify occupations.
Calculating the minimum rate of wages Central Government Code on Wages 2019


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