The minimum wages act was passed for the welfare of laborers. An employer must pay minimum wages to his employees. An employer is any person who employs and an employee is any person employed by an employer for any work i.e., skilled, unskilled, manual clerical, etc. The minimum wages act contributes towards eradicating poverty, reducing inequality as it aims at giving equal remuneration for work of equal value to both men as well as women. Wages’ means any remuneration capable of being expressed in terms of money.

For the minimum wages act to be applicable, an employee must be employed in scheduled employment. Scheduled employment Is any employment specified in the schedule of this act. There is a long list of scheduled employment, some of them are any Manufacturing Process carried out in any Factory, Automobile Engineering Workshops including Servicing & Repairs, Domestic Workers, Electronic Industry, Hospitals, Nursing Homes and Clinics Other than Government Hospitals and Dispensaries, Hotels and Restaurants and Eating Houses and so on.


“He who works is entitled to a fair remuneration which may enable him to live a life consistent with human dignity”

The most important objective of this act is to prevent the exploitation of the workers by providing for a minimum limit of wages in certain employments. It also looks into the situations where the less privileged people are exploited by the capitalists. This act gives power to the state government to take steps to set up a minimum rate of wages to ensure the welfare of the employee. The employer cannot get away by saying that he does not have the capacity to pay minimum wages to his employees. He either has to pay or shut down his business.


Some of the important features of this act are as under-

  • This act lays down fixation of the following rates:
  1. Minimum piece rate: when an employee is paid based on the nature of employment such as sweeping, carrying goods for sale, etc.
  2. Minimum time rate: when an employee is paid hourly i.e., for the particular time he works.
  3. Minimum overtime rate: when an employee works beyond duty hours, he is paid an overtime rate.
  4. Minimum guaranteed time rate: when an employee is assured/ guaranteed to be paid after completion of a month.
  • Any rate cannot be less than the minimum rate of wages.
  • This act lays down the payment of wages in cash. However, in certain situations, it can be paid in kind.
  • The Inspectors are appointed to hear claims arising out of payments.
  • The appropriate Government is empowered to fix the number of hours of work per day, to provide for a weekly holiday and the payment of overtime wages.
  • The establishments are required to maintain registers and office records as prescribed.
  • The appropriate Government has to revise the minimum wages every five years.


Wage structure can be divided into three categories:

  • Minimum wage

The minimum wage rate must not only be aimed towards providing bare subsistence of life i.e., basic necessities but also towards preserving the efficiency of the employee. This way he can contribute to the work assigned to him by the employer.

In calculating the minimum wage, the medical facilities, educational facilities, water supply, electricity supply, and other basic requirements should be taken into consideration. Minimum clothing requirements, sufficient food requirements per person should be considered. A person should not be malnourished. A person should be in a position to pay the minimum rent charged by the government in any area.

  • Fair wage

A fair wage is above minimum wage by slightly below the living wage. The fair wage depends upon various factors such as the productivity of labour i.e., the capacity of an employee to work, the capacity of industry to pay, and the level of national income and its distribution. If an employee is unskilled labour, he cannot ask for a fair wage to his employee but with time if he inculcates new skills, he can ask the employer to pay him a fair wage. The fair wage will be equivalent to the skill he acquires.

  • Living wage

A living wage should enable the employee to provide for himself as well as his family not only the bare essentials of food clothing and shelter but also certain facilities such as protection against ill- health, education for children, essential social needs and security such as insurance in the old age.


In August 2019, the CODE ON WAGES was enacted, which replaces the Minimum Wages Act, as well as other wage-related legislation like Payment of wages Act, 1936 and The Equal Remuneration Act,197, Payment of Bonus Act, 1965.

The code on wages aims at uniform applicability of the provisions of timely payment of wages and minimum wages to all employees irrespective of the wage ceiling and sector. The code is not yet come into force as it is a recent development. The central government shall appoint different dates for the different provisions of the act to come into force.





Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.

If you are interested in participating in the same, do let me know.

Do follow me on FacebookTwitter  Youtube and Instagram.

The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

If you would also like to contribute to my website, then do share your articles or poems at

We also have a Facebook Group Restarter Moms for Mothers or Women who would like to rejoin their careers post a career break or women who are enterpreneurs.

We are also running a series Inspirational Women from January 2021 to March 31,2021, featuring around 1000 stories about Indian Women, who changed the world. #choosetochallenge

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