Plan to make minimum wage mandatory for unorganised sector

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Updated: February 3, 2016 1:41:36 AM

Guaranteed minimum wages (MWs) could soon become an inalienable right for the country's entire unorganised-sector workforce, if a plan of the labour ministry is implemented.

The Centre's plan is to include the new proposal in the labour code on wages, which subsumes the Minimum Wages Act. (Reuters)The Centre’s plan is to include the new proposal in the labour code on wages, which subsumes the Minimum Wages Act. (Reuters)

Guaranteed minimum wages (MWs) could soon become an inalienable right for the country’s entire unorganised-sector workforce, if a plan of the labour ministry is implemented. According to sources, while workers in 45 scheduled categories of employment are currently under the Centre’s MW umbrella — even in their case, the implementation is often lax as norms are voluntary — the plan is to make MWs mandatory and extend it to all segments.

The labour ministry’s move comes close on the heels of the recent decision of the Rajasthan government to notify minimum wages for domestic workers. Currently, in addition to MWs prescribed by the Centre, state governments have such thresholds defined for some 1,679 labour categories.

The Centre’s plan is to include the new proposal in the labour code on wages, which subsumes the Minimum Wages Act. The ministry is also bringing unorganised sector workers under the ambit of various social security schemes including the Atal Pension Yojana and Employee’s State Insurance Corporation (ESIC) to ensure decent living and working conditions for them, labour secretary Shankar Aggarwal told FE.

Given the non-permanent nature of their work, unorganised sector workers would be given Unorganised Worker Identification Cards (U-WIN), which would help them to migrate from one employer to the other seamlessly and avail of their due entitlements. India has around 40 crore workers in the unorganised sector, more than 80% of its total workforce. The Rajasthan government recently notified R5,642 as minimum wage for domestic workers for an eight-hour job.

The Centre’s plan to bring the entire unorganised sector under a minimum wage stems from the idea of making employment respectable and ensuring that everyone gets decent wages at the end of the month at a fixed date. The present dispensation also intends that they are entitled to paid leaves and a fixed working hour. This is also to ensure that they are not exploited in the hands of the employers.

Genius Consultants’ chairman and managing director R P Yadav described the idea of the labour ministry as “wonderful”, but added that a proper mechanism should be put in place to ensure that the premiums are regularly deposited.

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