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Damper hint: Government plans minimum wage much lower than recommended amount

Independent analysts and two trade union members described the move as 'anti-labour' and as a 'betrayal' of the 40 crore-odd workers across the country

By Basant Kumar Mohanty in New Delhi
  • Published 13.07.19, 7:05 AM
  • Updated 13.07.19, 7:37 AM
  • 2 mins read
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The panel had recommended Rs 375 a day, based on the July 2018 price index, as the minimum wage in all the states. If a single rate was unacceptable because of the diverse labour circumstances, the committee suggested alternative rates ranging from Rs 342 to Rs 447 for the five regions. iStock photo

The Narendra Modi government is set to table a bill prescribing a nationwide daily minimum wage of less than Rs 180, rejecting its own expert panel’s recommendation for at least Rs 375 a day.

Independent analysts and two trade union members described the move as “anti-labour” and as a “betrayal” of the 40 crore-odd workers across the country.

On Wednesday, Union labour and employment minister Santosh Gangwar had told a media conference the minimum wage would be Rs 178 a day but the announcement did not tell the full story.

“On July 3, the first code (Code on Wages Bill) was approved by the cabinet. It will come to the Lok Sabha any day. More than 40 crore workers will benefit. Some states now have Rs 50, Rs 60 and Rs 100 as the daily wage. We have decided that the minimum wage will be Rs 178 per day,” Gangwar had said.

What was left unsaid was that the proposed Rs 178 was less than half the rate recommended by the expert panel, chaired by labour economist Anoop Satpathy.

The panel had recommended Rs 375 a day, based on the July 2018 price index, as the minimum wage in all the states. If a single rate was unacceptable because of the diverse labour circumstances, the committee suggested alternative rates ranging from Rs 342 to Rs 447 for the five regions in the country.

If the Code on Wages Bill fixes Rs 178 as the minimum wage, it will become binding on the entire country after the enactment. States can go above this rate but not below it. In Bengal, the minimum daily wage for unskilled labourers now ranges from Rs 210 to Rs 280 for different categories of work.

The minimum wage of Rs 178 indicated by Gangwar appears close to the Rs 176 notified in 2017 as the national floor-level minimum wage, which is not binding. Initiated in 1996, the floor-level minimum wage is updated every two years. The next update is due this month.

The Satpathy panel was set up after the central advisory board on minimum wages, represented by the Centre, trade unions and employers, felt the floor level of Rs 176 was not good enough to meet even the workers’ basic needs.

The Satpathy committee worked out the recommended wage rate on the basis of likely expenditures on a balanced diet, taking account of the protein and fat, and other heads such as entertainment and conveyance.

The labour ministry uploaded the report on its website in February, seeking public feedback. The central advisory board on minimum wages, headed by the Union labour minister, is supposed to discuss the panel’s recommendations. No meeting has been convened on this since the report was submitted.

The RSS-affiliated Bharatiya Mazdoor Sangh (BMS) said the announcement on the figure of Rs 178 was “meaningless” since the advisory board had not discussed it.

“The board is the appropriate body to discuss the expert committee’s recommendation and decide a rate. The government will finally take a call on the board’s decision. But the announcement of Rs 178 before discussion in the board is surprising,” said BMS general secretary Virjesh Upadhyay.

“What is the use if the government repeats the old NFLMW (floor-level) rate under the new law?”

A labour economist said the government should have waited at least a few more days till the updated floor-level rate was notified after adjusting for inflation. It might go up to around Rs 200.

CPM-backed Citu’s general secretary, Tapan Sen, said the proposal for a minimum wage of Rs 178 was anti-worker.

“The expert committee’s recommendations of Rs 375 or the region-wise minimum wage rates were much less than what the workers deserve. Now the government did not bother about its own committee’s suggestion. Its announcement of Rs 178 is anti-worker. It is a betrayal of workers,” Sen said.

An email from this newspaper to the labour ministry for comment did not elicit a response till Friday evening.