Code on Wages 2019 becomes a reality; minimum wage for 50 cr workers on the anvil

The Code on Wages 2019, which paves the way for the introduction of mandatory minimum wages at the national level for 50 crore workers, has become a reality now.

The government has notified the Code after it received assent from the President of India on August 8.

The Lok Sabha on July 30 had cleared The Code on Wages Bill, 2019, followed by the Rajya Sabha's nod on August 2.

The Bill enables the government to introduce the minimum wages for workers besides addressing issues such as delay in payment of wages to employees.

The Code has subsumed four labour laws -- Minimum Wages Act, Payment of Wages Act, Payment of Bonus Act and Equal Remuneration Act. After the enactment of the Code, all the four Acts stand repealed.

According to the new law, a tripartite committee comprising representatives of trade unions, employers and the state government would fix floor wages for workers throughout the country.

It would also ensure that there is no discrimination between men and women as well as transgenders in getting wages.

The Code seeks to universalise the provisions of minimum wages and timely payment of wages to all employees irrespective of the sector and wage ceiling.

The provisions of both the Minimum Wages Act and the Payment of Wages Act used to apply on workers below a particular wage ceiling working in Scheduled Employments only.

There were 12 definitions of wages in various labour laws, leading to litigation besides difficulty in its implementation. Under the Code, the definition has been simplified and is expected to reduce litigation and also reduce compliance cost for employers.

The Bill was earlier introduced in Lok Sabha in August 2017, and was referred to the Parliamentary Standing Committee, which submitted its report in December 2018.

However, owing to dissolution of 16th Lok Sabha, the Bill had lapsed. Therefore, a fresh Bill was drafted after considering the recommendations of the Parliamentary Standing Committee and other suggestions of the stakeholder.