Labour Law & Hr Consultant
Hr Professional

Sir/Ma'm Would like to request seniors and experts for guidance on :
The first query is with respect to the definition of the wages where I request to explain the interpretation of the second provision which relates to equal remuneration and provides that "for the purpose of equality in wages for all genders, the emoluments specified under clauses-(d), (f), (g) and (h) as mentioned above shall be included in the computation of wage."
Secondly, we pay everything in cash so what could be possible remunerations in kind by the employer? What will be modalities for valuation for remuneration in kind considering that 15% of the total wages payable to him shall be deemed to form part of the wages of such employee?
Thirdly the definition of employee has been provided for safeguarding minimum wages, payment of wages, and bonus. Is the employee employed in managerial capacity would be entitled to overtime as well as per COW 2019? Request the experts on the forum to kindly guide on the above-said queries, please.

From India, Calcutta
Dear friend,
1) Interpretation of the second proviso to Sec.2(y):
I think that it is imperative to discuss the general concept of wages before embarking upon the interpretation of the second proviso you have asked for. Universally, wages are determined by the employers and the employees by means of collective bargaining depending on the factors of demand and supply of labor. Therefore, the State has no role in this matter other than a regulatory one based on the principles of equity and justice. Though the definition of the term 'wages' means the entire pay out made to the employee by way of salary or remuneration under the contract of employment, the definition bifurcates such entire sum into two heads viz., inclusive components and excluded components.
The included components are (i) Basic pay (ii) Dearness Allowance and (iii) Retaining Allowance, if any.
The excluded items are a total of 11 in number from (a) to (k).
Thus this bifurcation enables the uniform application of the term under the Code for the purposes of timely payment of wages without any illegal deductions, fixation of statutory minimum wages and determination and payment of statutory bonus, elimination of disparity in wages based on gender bias and settlement of claims against non-payment. Moreover, certain fringe benefits pertaining to the future in the form of social security to the working class have also to be determined from the wages currently payable only. Hence, the first proviso to the definition mandates an equal proportion of the inclusive and excluded components in the wage structure and when the proportion of the sum of the inclusive components falls short of 50% of the gross, the short fall shall be made good by adjusting against the excluded components enumerated under (a) to (i).
If we analyze the nature of the components listed under clauses (d) Conveyance Allowance, (f) House Rent Allowance, (g) remuneration payable under any award, settlement between the parties or order of a court or tribunal, there cannot be any room for gender bias in respect of employees doing the same work or similar nature of work as contemplated u/s 3(1) of the Code. Therefore, in order to determine over all parity in terms of remuneration, these excluded components have also to be taken into consideration. That's what the second proviso to section 2(y) mandates.
2) Remuneration in kind restricted to 15% of the gross:
This is applicable to employments by the very nature of which food, accommodation, supply of electricity, water etc., are provided by the employer and adjusted against the gross wages payable. Eg - Plantation industry, Hotel industry. To know the scales and other guidelines in this regard, we have to await the notifications to be issued by the appropriate Governments under the Rules.
3) In my opinion, despite the definition of the term " employee" u/s 2(k), managerial cadre employees are not entitled to overtime wages in view of the definitions of the term "worker" u/s 2(zzl) of the OSH Code 2020 and u/s 2(z) of the CoW,2019 read with sec.27 of the OSH Code,2020 which deals with extra wages for overtime work.

From India, Salem
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