Private Consultant On Labour Laws
Assistant Manager-hr
+1 Other

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Dear All,
I would like to seek advice regarding the exact meaning of "Wage". Few employers are wrongly addressing the term and it is affecting the compensation of an employee. Like as i have come across few organizations where they are considering "Gross Amount as Wage" and deviating the minimum wage rule. For example as per MWA for unskilled employees the wages should be for Odisha 5265 ( 202.50 *26) . In my opinion the basic pay of the employee coming under this category should be 5265. But as per employer the gross should be 5265. They are telling that the definition of wage changes from act to act i.e. it if different for PF-1952 act, different for Minimum wage act.
Kindly advice so that questions can be raised by me to them.

Dear Aman,

There is no doubt that defination of "wages" varies from Act to Act. As such when you refer to some issues, you have to check the definition of wages of that particular Act. Wages are fixed regular payment earned for work or services, typically paid on a daily, weekly or monthly basis.

The wages under Minimum Wages Act,1948 means all remuneration capable of being expressed in terms of money and includes HRA.

The minimum rates of wages are fixed or revised by the appropriate Government in respect of scheduled employments.The wages may be consist of-

(¡) a basic rates of wages and a special allowance to be adjusted at intervals in form of cost of living allowance/ index.

(ii) a basic rates of wages with or without the cost of living allowance and cash value of concessions in respect of supplies of essential commodities at concessional rates.

(iii) an all-inclusive allowance for the basic rate, the cost of living allowance and the cash value of the concessions, if any.

The cost of living allowance and the cash value of concessions in respect of the supplies of the essential commodities at concessional rates shall be computed by the competent authority at such intervals as directed by the appropriate Government.

BS Kalsi,

Member since August, 2011

Thanks Mr. Kalsi. So will you please guide me what are things to be considered in the following Salary Components under "Wage".
Basic,HRA,Special Allowance,Travel Allowance,Duty Meal Component,Hill Station Allowance,Medical Allowance,City Allowances.
All of them are paid on monthly basis.

The issue of splitting of minimum wages has been decided by supreme court in the case detailed below. Law don't provide against splitting of minimum wages.
the difficulty is the definition of wages under the MW Act does not define constituents of wages as basic & DA.

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