Code on Wages 2019 (Download PDF)

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The Rajya Sabha passed, Code on Wages bill 2019, replacing the four laws. This includes the payment of Wages Act, 1936. The minimum Wages Act, 1948, the payment of Bonus Act, 1965, The Equal remuneration Act, 1976. This code will apply to all the employees in the country. The centre will make wage related decisions for employment in Railways, Oil Fields, Mines etc. , Other employment related decisions will be taken care by the state government. In India the industrial growth has been pulled back due to complexity of the labor laws.

  • The minimum wage is referred to as the minimum payment by and employer pay legally.
  • Living wage specifies that it provides minimum wage and also other factors such as human development needs like education and health to their family, social needs and safety nets like insurance and pension.
Key Provisions Labour Code on Wages
  • Wage floor is the lowest possible wage below which wages fall.

Need for Code on Wages 2019

  • In India there are multiple laws on wages to create complexity and confusion among employees and employers.
  • Lack of uniformity among the various laws.
  • Gender discrimination is another issue related to these laws. Income of the women in various sectors is less than the men.
  • The lack of coverage among the laws.

Provisions of Wage Code-2019

  • The major benefit of this code is universal coverage.
  • Centre will fix floor wage and it will be linked to the standard of living.
  • Depending on geographical area, it sets different floor wages.
  • Minimum wage will be fixed by both centre and state and it should be much greater than the floor wage.
  • The number of working hours will be set up by the centre and state government, if there any overtime duty the company would have to pay the two times of the that minimum wage.
  • Payment of wages will be through currency notes, by cheque, through electronic mode or crediting through their bank accounts.
  • The deductions of employee salary should not exceed 50 % of the total wage.
  • The code prohibits gender discrimination.
  • Penalties applicable if any offence by an employer.
  • Subsuming of multiple laws under one will eliminate complexity and confusion.
  • It will improve standard of living.

- Published/Last Modified on: December 20, 2019

Policy/Governance, Govt. Schemes/Projects, Bills

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