Fresh committee to propose national floor level minimum wages set up:

A cruel joke on the working class

On June 2, the Union Ministry of Labour and Employment announced the setting up of a six member “expert committee” to fix minimum wages. According to the announcement, this committee has been given a tenure of three years. It is supposed to investigate “international best practices” and propose to the government how to fix minimum wages, and what should be the “national floor level minimum wage”.

The establishment of a committee to fix minimum wages, nearly two years after the Code on Wages was passed by parliament, is a cruel joke on the working class.  It shows that the Central government has no concern for the plight of crores of workers of our country. Trade unions, cutting across party affiliation, have condemned the government for not revising minimum wages for the past seven years. They have correctly pointed out that the setting up of a committee with a tenure of three years is nothing but a delaying tactic, through which the central government is driving the vast majority of workers of our country deeper into poverty.

Two years ago, in August 2019, the Central government passed the Code on Wages Act, 2019. This act subsumed four existing laws — Payment of Wages Act, 1936, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965 and the Equal Remuneration Act, 1976. At that time, the propaganda machinery of the ruling class painted this as a great step forward for the workers of our country. According to this propaganda, the government was fulfilling the long standing demand of the working class for a national floor level minimum wage, below which no worker should be paid in any state in India.

The reality is very different.  First of all, working class has been consistently demanding that the state guarantee living wages for all workers. Living wages means that a worker must receive such wages as to enable his or her family to be not only protected from poverty and want, but also be able to ensure education, health care, a decent home, and all that is required for themselves and their families, to ensure a life of dignity in the present day. The minimum wages set by the central government and various state governments before the Code on Wages was enacted fell well short of a living wage.

The minimum wages are defined as a wage which is just sufficient to ensure that the worker and his or family can keep body and soul together. The 15th Indian Labour Conference (ILC) of 1957, together with the judgment of the Supreme Court in the Workmen vs Reptakos Brett & Co. case in 1992 are considered as the basis for determining minimum wages. Trade unions have been demanding a minimum wage of Rs 22,000 on the basis of the above. The Central and state governments have refused to implement the decisions of the ILC and the judgment of the Supreme Court in practice.

The Code of Wages divided India into different geographical regions for the purpose of setting minimum wages. There would be a floor level minimum wage for each region applicable throughout the region. No state in the region could declare a minimum wage below this floor level minimum wage. Furthermore, the Central government would set a national floor level minimum wage.

The Central government made sure that the basis for determining minimum wages was not included in the Code on Wages. Instead it would be determined by an “expert committee”. Now, two years later, it has just now set up such a committee.

Before the Code on Wages was enacted in August 2019, the Central government had set up an “Expert Committee” known as the Satpathy Committee in January 2017 to propose what should be the national floor level minimum wages, and how these wages should be determined. That committee submitted its report two years later, in February 2019.  According to its recommendations, the country was to be divided into five regions for the purpose of determining floor minimum wage. Each region would have a floor minimum wage, and the country as a whole would have a national floor minimum wage.

The Satpathy committee recommended a National Floor Minimum Wage of Rs 375 per day (Rs 9,750 per month) as of July 2018. It also recommended introducing a additional house rent allowance (city compensatory allowance) of Rs 55 per day (Rs 1430 per month) for urban workers over and above the National Minimum Wage.

The recommendations of the Satpathy committee on Wages was far below what workers and their unions were demanding. But the capitalist class considered even this as being too high. The Central Government rejected the recommendations of the Satpathy committee on wages, and disbanded that committee. At that time, the capitalist class proposed to the Central government that the National Minimum wage must be set at Rs 176 per month, a wage lower than what the majority of state governments had already set as minimum wages! In the face of massive uproar amongst workers at this proposal, the government passed the Code on Wages, but did not set what should be the National Floor Level Minimum Wage, or how it should be determined.

The demand of workers for a minimum wage that is at the same time a living wage, is absolutely just. Even though many workers get paid much lower than the statutory minimum wages in practice, it is also a fact that raising the statutory minimum wages has an effect of raising the average wages of the entire class. On the other hand, lowering the statutory minimum wages lowers the average wages of the entire class.

The capitalist class is deadly opposed to raising the statutory minimum wages.  It has taken advantage of the Covid crisis and the repeated lockdowns to greatly intensify the degree of exploitation of workers. While crores of workers have been thropwn out of their jobs, those with work are being forced to work for much longer hours, without any increase in daily or monthly wages. In many cases, employers have cut the monthly wages while greatly increasing the length of the working day.   The government’s delay in deciding the level of Minimum Wage is deliberate – it serves the capitalist class to push actual wages paid as low as possible, in the meantime.


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