48 The Minimum Wages Act 1948: Object, Constitutional Foundation, Definitions, Scheduled Employments, Fixation and Revision (Committee and Notification Methods), Advisory Boards, Working Hours and Overtime, Penalties, Reptakos Brett (1992) and the Code on Wages 2019
48.1 A Floor Beneath Which No Wage Should Fall
The Minimum Wages Act 1948 was passed in the first year of Indian Independence — a statement that the new Republic would not tolerate sweated labour. The Act creates a floor below which a worker’s wage cannot legally fall in scheduled employments, irrespective of the worker’s “agreement” to a lower rate. The Supreme Court has held that paying below the minimum wage amounts to forced labour under Article 23 of the Constitution. This chapter pulls together the Act’s framework — definitions, scheduled employments, fixation procedures, working hours, payment, claim and penalty provisions — and notes how the Code on Wages 2019 universalises the minimum wage to all employments.
48.2 1 · Object, Extent and Commencement
| Aspect | Detail |
|---|---|
| Year | 1948 (Act 11 of 1948) |
| Commencement | 15 March 1948 |
| Object | To provide for fixing minimum rates of wages in certain employments |
| Extent | The whole of India |
| Successor | Code on Wages 2019 |
The Act gives effect to the constitutional commitments under Article 23 (no forced labour), Article 39(a) (right to adequate means of livelihood) and Article 43 (living wage and decent standard of life).
48.3 2 · Key Definitions — Section 2
| Term | Section | Substance |
|---|---|---|
| Wages | 2(h) | All remuneration capable of being expressed in money payable to a person employed in respect of his employment if the terms of the contract were fulfilled — includes house rent allowance; excludes value of accommodation, light, water, medical, PF / pension contributions, travel allowance, ex-gratia |
| Employee | 2(i) | A person employed for hire or reward in any scheduled employment in respect of which minimum rates of wages have been fixed |
| Employer | 2(e) | Any person who employs (directly or through another) one or more employees in any scheduled employment |
| Scheduled employment | 2(g) | An employment specified in the Schedule, or any process or branch of work forming part of such employment |
| Cost of living index number | 2(d) | The official index for the area / employment |
| Adolescent / adult / child | 2(a), (aa), (bb) | Age-based |
48.4 3 · The Schedule — Scheduled Employments
The Schedule originally listed 13 employments (with separate Part I for non-agricultural and Part II for agricultural). Over time, more than 45 employments have been added by various states. Notable entries include:
| Part I (non-agricultural) | Part II (agriculture) |
|---|---|
| Woollen carpet making and shawl weaving | Agriculture |
| Rice, flour and dal mills | Plantation work |
| Tobacco manufactories | Forestry |
| Plantation industries | Cattle-rearing |
| Oil mills | |
| Local authority | |
| Road construction or building operations | |
| Stone-breaking or stone-crushing | |
| Lac manufactories | |
| Mica works | |
| Public motor transport | |
| Tanneries and leather manufactories | |
| Gypsum and barytes mines (added later) |
48.4.1 Power to Add Employments — Section 27
The appropriate government may add any employment to the Schedule by giving at least three months’ notice of its intention by notification — after which it is added by another notification. Once added, it is treated like other scheduled employments.
Under the original Minimum Wages Act 1948, minimum wages are fixable only in scheduled employments. The Code on Wages 2019 removes this limitation — minimum wages now apply to all employments universally.
48.5 4 · Fixation and Revision of Minimum Wages — Sections 3 to 5
48.5.1 Section 3 — Power to Fix and Revise
The appropriate government must:
- Fix the minimum rate of wages for scheduled employments.
- Review at intervals not exceeding five years and revise as necessary.
- Fix wages for different time periods (hour, day, month) and different work classifications.
48.5.2 Types of Minimum Wage — Section 3(2)
| Component | Description |
|---|---|
| Basic rate + special allowance | The two-tier structure where DA varies with the cost of living |
| Basic rate with cash value of concessions | Where essential commodities are supplied at subsidised rate |
| All-inclusive rate | A single consolidated rate |
48.5.3 Section 4 — Cost-of-Living Allowance
Where minimum wages are fixed under Section 3, they may include:
- A basic rate plus a dearness allowance linked to the cost-of-living index.
- A basic rate plus the cash equivalent of essential commodities supplied at a subsidised rate.
48.5.4 Section 5 — Two Procedures for Fixation
The Act prescribes two procedures by which minimum wages may be fixed or revised — and the choice between them is left to the appropriate government.
| Method | Description |
|---|---|
| Committee Method (Section 5(1)(a)) | Government appoints Committees and Sub-Committees to hold inquiries and advise; after considering the advice, the government fixes the wage by notification |
| Notification Method (Section 5(1)(b)) | Government publishes a draft notification of its proposals, inviting representations within at least two months; after considering representations and consulting the Advisory Board, it fixes the wage by final notification |
Committee method = tripartite inquiry first; Notification method = draft published, representations invited. The committee method is preferred for first-time fixation; the notification method for routine revisions. NTA stems test the distinction.
48.6 5 · Advisory Bodies — Sections 7 to 9
| Body | Section | Function |
|---|---|---|
| Advisory Board | 7 | Coordinates the work of committees and sub-committees and advises the appropriate government on matters arising out of the Act |
| Central Advisory Board | 8 | Advises central and state governments on fixation / revision of minimum wages and coordinates state-level work |
| Committees and Sub-Committees | 9 | Constituted by the appropriate government for the purpose of Section 5(1)(a); equal representatives of employers and employees + independent persons appointed by government; chair is one of the independent members |
The independent member as chair ensures even-handedness in disputes between the employer and employee groups.
48.7 6 · Payment of Minimum Wages — Sections 11 to 16
| Section | Provision |
|---|---|
| 11 | Wages in cash — minimum wages payable in cash; partial payment in kind allowed only by notification |
| 12 | Payment of minimum rates of wages — employer cannot pay less than the notified minimum |
| 13 | Fixation of hours for a normal working day — generally 9 hours; rest interval; weekly day of rest |
| 14 | Overtime — payable at the rate fixed by the appropriate government (typically twice the ordinary rate) |
| 15 | Wages of workman who works for less than the normal day |
| 16 | Wages for two or more classes of work |
48.7.1 Section 13 — Working Hours
| Element | Provision |
|---|---|
| Normal working day | 9 hours (adult) |
| Rest interval | At least half an hour after 5 hours of continuous work |
| Total spread-over | Not more than 12 hours |
| Weekly day of rest | Compulsory — wages payable for the rest day |
| Compensatory holiday | For work on the rest day |
48.7.2 Section 17 — Minimum Time-Rate for Piece Work
Where an employee in a scheduled employment is on piece rates and the minimum wages are fixed only for time work, the employer must pay wages at not less than the minimum time rate.
48.7.3 Section 18 — Maintenance of Registers and Records
The employer must maintain:
- Register of wages.
- Register of overtime.
- Register of fines and deductions.
- Wage slips.
- Attendance and muster register.
48.8 7 · Claims, Inspection and Enforcement — Sections 19 to 22
| Section | Provision |
|---|---|
| 19 | Inspectors appointed by the appropriate government — powers of entry, examination, sampling, seizure |
| 20 | Claims — by employee, or any official of registered trade union acting on his behalf, before the authority appointed under the Act within six months from the date the wages became payable; authority can grant up to 10 times the unpaid amount as compensation |
| 20A | Single application in respect of a number of employees |
| 21 | Limitation — claims to be made within 6 months (extendable on sufficient cause) |
| 22 | Penalties for paying less than the minimum wage or for contravening rules |
48.8.1 Section 22 — Penalties
| Offence | Punishment |
|---|---|
| Employer paying less than the minimum wage | Imprisonment up to 6 months or fine up to Rs 500, or both |
| Contravention of other provisions | Fine up to Rs 500 |
| Cognisance | Only on inspector’s complaint with sanction of the appropriate government |
The original penalties are modest; the Code on Wages 2019 substantially enhances them.
48.9 8 · Constitutional Backing — PUDR v. Union of India (1982)
The Supreme Court — in the Asiad Workers case, People’s Union for Democratic Rights v. Union of India (1982) — held that the payment of less than the prescribed minimum wage to any workman is a violation of Article 23 of the Constitution (prohibition of forced labour). Justice P. N. Bhagwati observed that any worker performing work for less than the minimum wage is providing labour involuntarily, and this is a form of begar prohibited by Article 23.
PUDR v. Union of India (1982) — paying less than the minimum wage amounts to forced labour under Article 23 — is the most-tested constitutional anchor of the Minimum Wages Act. NTA stems frequently test this proposition.
48.10 9 · Six-Component Formula — Reptakos Brett (1992)
The 15th Indian Labour Conference (1957) at Nainital had laid down a five-component formula for the need-based minimum wage (covered in Topic 45). In Workmen v. Reptakos Brett & Co. Ltd. (1992), the Supreme Court added a sixth component — 25 % for children’s education, medical, recreation and provision for old age and marriage — bringing the formula closer to the living wage concept.
| # | Component |
|---|---|
| 1 | 3 consumption units per family (Aykroyd) |
| 2 | 2,700 calories per consumption unit per day |
| 3 | 18 yards (later 72 yards / 66 metres) of clothing per family per year |
| 4 | Minimum government industrial-housing-scheme rent |
| 5 | 20 % for fuel, lighting and miscellaneous |
| 6 | 25 % for education, medical, recreation, old-age and marriage provision (Reptakos Brett 1992) |
48.11 10 · Exemptions and Exclusions
- Section 26 — Power of appropriate government to exempt certain factories or classes of employees from any or all provisions of the Act, by notification.
- Section 22F — Bar of suits in respect of unpaid wages where the claims procedure under Section 20 applies.
- Government may exempt disabled and trainee workers, and certain emergency employments, by notification.
48.12 11 · Position under the Code on Wages 2019
The Code on Wages 2019 consolidates the Minimum Wages Act 1948 along with the Payment of Wages Act 1936, Payment of Bonus Act 1965 and Equal Remuneration Act 1976.
| Provision | 1948 Act | Code on Wages 2019 |
|---|---|---|
| Coverage | Only scheduled employments | Universal — all employments |
| Floor wage | None | National floor wage fixed by central government — state minimum wage cannot fall below it |
| “Wages” definition | Wide; varies by statute | Uniform definition with 50 % cap on excluded allowances |
| Fixation methods | Committee and Notification | Continued |
| Revision interval | At least every 5 years | Continued |
| Working hours / overtime | Section 13 / 14 | Continued |
| Equal remuneration | Separate Act | Integrated; gender-neutral; all genders |
| Inspector | Inspector | Inspector-cum-facilitator — advisory + enforcement |
| Penalties | Modest (up to Rs 500) | Substantially enhanced (up to Rs 1 lakh and imprisonment) |
The national floor wage under the Code on Wages 2019 is the most significant innovation — it sets a baseline below which no state can notify a lower minimum wage. The central government fixes this floor wage after consultation with the Central Advisory Board.
48.13 12 · Significance and Critique
- First Indian wage-floor statute — gave legal effect to the constitutional promise.
- The PUDR case (1982) elevated the minimum wage from a statutory entitlement to a constitutional right under Article 23.
-
Critique:
- Variation across states — historically very wide; only partly addressed by the floor wage.
- Notification delay — five-year revision often not done on time.
- Compliance — particularly poor in the unorganised sector.
- Indexing — DA mechanisms vary.
- Coverage — until 2019 limited to scheduled employments.
- The Code on Wages 2019 addresses several of these gaps — universal coverage, national floor wage, uniform definition.
48.14 Practice Questions
The Minimum Wages Act was enacted in:
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Under Section 3, minimum wages must be reviewed at intervals not exceeding:
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The two procedures for fixation of minimum wages under Section 5 are:
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PUDR v. Union of India (1982) held that paying below the minimum wage amounts to:
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Under Section 13, the normal working day for an adult is generally:
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Reptakos Brett v. Its Workmen (1992) added a sixth component of how much for education, medical, recreation, old-age and marriage?
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A claim under Section 20 must be made within:
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Under Section 20, the authority can award compensation up to how many times the unpaid amount?
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Under the original Minimum Wages Act 1948, the Schedule has:
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Match the section with its content:
| (i) | Section 3 | (a) | Two procedures for fixation |
| (ii) | Section 5 | (b) | Power to fix and revise |
| (iii) | Section 13 | (c) | Claims |
| (iv) | Section 20 | (d) | Working day |
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The most significant change brought by the Code on Wages 2019 to the minimum-wage regime is:
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Under Section 11, minimum wages are payable:
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The Advisory Board is constituted under:
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Under Section 27, an employment may be added to the Schedule after how many months' notice of intention?
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Overtime under Section 14 is normally paid at:
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Penalty under Section 22 of the original Act for paying below the minimum wage is up to:
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The maximum spread-over of work hours under Section 13 is:
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Under the original Minimum Wages Act 1948, minimum wages are fixable only in:
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In the Notification Method under Section 5(1)(b), the period for representations is at least:
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Under the Code on Wages 2019, a state's minimum wage:
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48.15 Quick Recall
- Minimum Wages Act 1948 — in force 15 March 1948; gives effect to Articles 23, 39(a), 43.
- Applies only to scheduled employments (Part I non-agricultural; Part II agricultural) — universal under Code on Wages 2019.
- Section 3 — power to fix and revise; revision interval not exceeding 5 years.
- Section 5 — Two procedures: Committee method (5(1)(a)) and Notification method (5(1)(b) — at least 2 months for representations).
- Sections 7-9 — Advisory Board, Central Advisory Board, Committees; independent member chairs.
- Section 11 — wages payable in cash (partial in kind only with notification).
- Section 13 — normal working day 9 hours; rest break after 5 hours; spread-over 12 hours; weekly day of rest.
- Section 14 — overtime at twice the ordinary rate.
- Section 20 — claims before the prescribed authority within 6 months; compensation up to 10 times the unpaid amount.
- Section 22 — penalty: 6 months / Rs 500 (original Act).
- Section 27 — power to add employments to the Schedule with 3 months’ notice.
- PUDR v. Union of India (1982) — paying below the minimum wage = forced labour under Article 23.
- 15th ILC 1957 — 5-component need-based formula (3 consumption units, 2,700 calories, clothing, housing, 20 % misc.); Reptakos Brett (1992) added 6th component, 25 % for education, medical, recreation, old age, marriage.
- Code on Wages 2019: universal coverage, national floor wage, uniform definition with 50 % cap on excluded allowances, inspector-cum-facilitator, enhanced penalties.