In this blog post, Archishman Chakraborty, a student pursuing a Diploma in Entrepreneurship Administration and Business Laws by NUJS, discusses the provisions of minimum wages in the agricultural sector.
The wages and policies with respect to the employment of the workers in the unorganized sector, with specific emphasis upon the minimum wages paid to them, have been subject to many debates and discussions by the policy makers in India. The Constitution of India desired to establish a just and humane society and accordingly calls for a living wage under the chapter Directive Principles of state policy. The principal labor legislation for the workers in the unorganized sector is The Minimum Wages Act, 1948. The Minimum Wages Act, 1948 finds its inception in Article 43 of the Constitution which states, “The state shall endeavour to secure by suitable legislation or economic organisation or in any other way to all workers, agricultural, industrial or otherwise, work, a living wage (emphasis added) conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities.”.
Purpose of the Act
The minimum wages Act aims to provide minimum compensation for work done by the workers and provides for payment of minimum wages for workers engaged in scheduled employments. While wages in the in the organized sectors are determined by negotiations and settlements between employer and employees, in unorganized sectors, where labor is vulnerable to exploitation due to illiteracy and is devoid of the bargaining power, the intervention of the govt. Becomes indispensable. The Minimum Wages Act hence tries to provide for fixation and enforcement of minimum wages in respect of schedule employments to prevent exploitation of workers by payment of lower wages. 
Once the minimum wages are fixed according to the provisions of the Act, the employer cannot plead inability to pay the fixed wages. In India, the workers in the unorganized sectors contribute to more than 60 % of the country’s GDP growth and by an estimate 94 % of the total work force – close to 422.6 million workers are employed in the unorganized sector, making the need to prevent their exploitation even more necessary.
The lowest pay permitted by law rates in India are altered or decided upon under the Minimum Wages Act, 1948. Since labor is a simultaneous subject under the Indian Constitution, the lowest pay or the minimum wage permitted by law rates are resolved both by the Central Government and the State Governments. These rates in India are announced at the national, state and sectoral levels. They might be built up for any area, occupation, and division.
Composition of Minimum Rate of Wages
Minimum rate of wages may comprise of a fundamental rate of wages and a typical cost for basic items remittance; or an essential rate of wages, with or without the average cost for basic items recompense, and the trade estimation of concessions and appreciation of the supply of key products at concession rates (if approved); or a comprehensive rate taking into consideration the essential rate, the typical cost for basic items and the monetary estimation of the concessions (assuming any).
While altering or modifying least rates of wages, diverse rates of wages might be settled for various occupations; distinctive classes of work in the same job; grown-ups, young people, youngsters and disciples; and distinctive areas. The lowest pay rates might be settled by an hour, day, month or any such other bigger pay period as might be recommended.
Under the Minimum Wages Act, both the Central and State Governments may advise the scheduled employments and fix/modify the lowest pay rates for these planned livelihoods. These incorporate both the horticultural and non-agro, non-rural jobs.
Employment in agriculture, that is to say, in any form of farming, including the cultivation and tillage of the soil, dairy-farming, the production, cultivation, growing and harvesting of any agricultural or horticultural commodity, the raising of livestock, bees or poultry, and any practice performed by a farmer on a farm as incidental to or in conjunction with farm operations (including any forestry or timbering operation and the preparation for market and delivery to storage or to market or to carriage for the transportation to market of farm produce) is contained in Schedule II of the Minimum Wages Act, 1948
Both the Central and State Governments are enabled to notify any employment in the schedule where the quantity of representatives is 1000 or is progressively increasing and fix the rates of least wages in admiration of the workers utilized.
Wages implies all equipped for being communicated as far as monetary terms are concerned, which would, if the terms of the employment, express or inferred were satisfied, be payable to a man utilized in appreciation of his job or of work done in such job. It however does exclude the estimation of any house-settlement, supply of light, water, restorative participation, or some other endorsed luxury or administration; any benefits or provident asset, or social protection plans; voyaging stipends or concessions; repayment for unique costs caused by the worker; or gratuity payable on release.
As per the Minimum Wage Act, the employer is obliged to pay wages on standard and convenient premises at least once every month. Wage period might be settled on hourly, every day, week by week or month to month premise. The employer is under commitment to pay compensation in real money on a working day before the expiry of the seventh day after the last day fixed as wage period. (in foundations with under 1000 employees). In other foundations, i.e., those enlisting more than 1,000 of them, wages must be paid before the expiry of the tenth day after such time frame. If an employee is fired by or for the employer, the due wages are paid within two days of the job ending. Wage periods can’t be settled for a length longer than one month.
Least wages are by and large payable in monetary terms (cash), but if it is standard to pay compensation entirely or somewhat in kind, the suitable Government may approve the installment of minimum wages either completely or mostly in kind.
Minimum Wages Act,1948 requires that all wages be paid in current coin or money notes or both. An employer may, after getting the composed written approval by the laborer, pay him the wages either by a cheque or by crediting the wages in the bank.
New Developments
One of the earliest labor enactments in India, the Minimum Wages Act was sanctioned in 1948 instantly after India accomplished Independence. Be that as it may, even today a substantial area of the workforce stays outside the domain of the Minimum Wages Act.
In 2005, the Government of India thought introducing an enactment titled the ‘National Rural Employment Guarantee Act’ later known as the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) which accommodates the improvement of work security of the family units in provincial territories of the nation by giving no less than 100 days of assured employment to each family unit whose grown-up individuals volunteer to do incompetent manual work or unskilled labour. The Act likewise sets out the wage rate as unmistakable from the Minimum Wages Act, 1948 wherein Section 6 of the MNREGA says that the Central Government may by notice indicate the pay rate and that diverse rates of wages may be determined for various territories and the wages rate settled whenever should not be under Rs.100 every day.
The introduction of schemes such as MNREGA to ensure the benefit of workers is working to the advantage of their livelihoods. What India needs is, a few more steps to be taken in that direction along with cementation of the already existing provisions so as to ensure a stable growth and a proper livelihood be provided to these hard working bread earners in the society.
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