METHODS OF MINIMUM WAGES

 

METHODS OF MINIMUM WAGES


MEANING AND DEFINITION OF MINIMUM WAGES


Minimum Wages means the minimum payment to a worker so that he may be able in providing for basic needs for himself and his family members and to maintain his working efficiency only. Some other scholars are of the view that minimum wages should also provide for minimum education, medical facilities and other amenities.   According to them, minimum wages should ensure a minimum standard of living considering the health, efficiency and well-being of the worker.


"Minimum Wages should provide not only for the bare necessities of the worker. It should also provide for the maintenance of the efficiency of the worker. From this point of view, minimum wages must be sufficient to provide for all requirements of education, health and other essential "amenities". 

Fair Wages Committee,



METHODS OF MINIMUM WAGES


There are two methods to determine the Minimum Wages. These methods are as under:


(i) Indirect Method:


The Government determines minimum wages keeping m view the following provisions of the Minimum Wages Act :

1. Government determines minimum wages for the workers working in government departments. Following the wages so determined by the government, the minimum wages in the private sector industries are also determined.

2. While working on a   contract, the government imposes a condition of minimum wages in the contract deed.


(ii) Direct Method:


For the determination of Minimum wages, the Govenment may take following steps-


1. To Determine Minimum Wages- Under this method of wages determination, the State Government may determine minimum wages for the workers working in different industries. After determining such wages, the Government issues orders to the enterprises to pay these wages to the workers working in their industries. This method is widely adopted in India.


2. To Appoint Wages Boards- The State Government may also appoint wage boards for the determination of minimum wages. These boards may be of two types:

(i) Wages boards appointed for the purpose of advising government on the issue of minimum wages. It is important to know that these boards are responsible to give their advice only,

(ii)   Wages boards that are appointed to determine the minimum wages after considering the circumstances of the industry. Representatives of both the workers and employers take part in these boards.


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