How Should Salary Be Structured for Permanent Employees Considering Minimum Wages?

For permanent employees who are entitled to get leave and receive full days of monthly salary, along with paid holidays, weekly offs, and other leave benefits, what salary structure should be considered in relation to minimum wages? For example, if the minimum wage is Rs. 294.40, should the salary be Rs. 9126.40 (294.40 x 31 days maximum monthly) or Rs. 7654.40 (294.40 x 26)? Please share your views.

Dear friend,

The Minimum Wages Act, rules, or notifications define the rock-bottom wage, which comprises the basic salary plus House Rent Allowance (HRA). When structuring the pay of permanent employees, the basic wage should not fall below the prevailing minimum wage. All other benefits should be calculated based on this minimum wage figure, with the total divided by 26 days to determine the daily wages (accounting for 4 paid off days).

Thank you.

You need to refer to the minimum wages notification that was issued by your state. The actual working is provided. In most cases, it provides monthly minimum wages, not daily, and that considers a weekly off that you need to pay. In some cases, a daily rate is provided, but then it also specifies that this is for 26 days and that weekly offs are already accounted for in this. You need to follow the notification strictly.

Annual Leave Requirements

The requirement of providing annual leave is in the Factory Act or Shop Act. It is in addition to the weekly off and has nothing to do with minimum wages, except that the salary for leave days needs to be paid at the standard rate or, in case of uneven earning, then based on an average of 3 months.