Labour Rights Codes on wages Bill

Labour Rights Codes on wages Bill

The Code on Wages bill 2019 was introduced in Lok Sabha which seeks to regulate wage and bonus payments in all employments where any industry, trade, business, or manufacture is carried out.

Objectives of the Labour Rights Codes on wages Bill, 2019

1. The Code replaces the following four laws: (i) the Payment of Wages Act, 1936, (ii) the Minimum Wages Act, 1948, (iii) the Payment of Bonus Act, 1965, and (iv) the Equal Remuneration Act, 1976.
2. The bill seeks to consolidate laws relating to wages by replacing- Payment of Wages Act, 1936; Minimum Wages Act, 1948; Payment of Bonus Act, 1965 and Equal Remuneration Act, 1976.
3. To formulate a statutory National Minimum Wage for different regions. The economic survey 2018-19 had also mentioned that a national mandatory minimum wage is a requirement.

Key Features of Labour Rights Codes on wages Bill, 2019

1. Coverage: The Code will apply to all employees. The central government will make wage-related decisions for employments such as railways, mines, and oil fields, among others.  State governments will make decisions for all other employments.
2. Floor wage: According to the Code, the central government will fix a floor wage, taking into account living standards of workers.  Further, it may set different floor wages for different geographical areas.  Before fixing the floor wage, the central government may obtain the advice of the Central Advisory Board and may consult with state governments.
3. Gender discrimination: The Code prohibits gender discrimination in matters related to wages and recruitment of employees for the same work or work of similar nature.  Work of similar nature is defined as work for which the skill, effort, experience, and responsibility required are the same.  
4. Defined Wages appropriately: it removes the multiplicity of wage definitions leading to significantly reduce in litigation as well as compliance cost for employers.
5. Uniform wages:The Bill stipulates to link minimum wages only to factors such as skillset and geographical location. This would bring down the number of minimum wage rates across the country to 300. These labour Codes seek to universalise the right to minimum wage of workers, presently available to only about 30% of the workforce engaged in the scheduled employments.
6. Extends to all sectors: It seeks to universalizes the provisions of minimum wages and timely payment of wages to all employees irrespective of the sector and wage ceiling.
7. National Floor Level Minimum Wage: To be set by the Centre and will be revised every five years, while states will fix minimum wages for their regions, which cannot be lower than the floor wage.
8. Offences: The Code specifies penalties for offences committed by an employer, such as (i) paying less than the due wages, or (ii) for contravening any provision of the Code.  Penalties vary depending on the nature of offence, with the maximum penalty being imprisonment for three months along with a fine of up to one lakh rupees.