Navigating the Minimum Wages Act: How to Choose the Right Employment Schedule for Your Industry

How can an employer in an industry adopt a suitable scheduled employment when there are two or more similar employments in the schedule applicable to the industry?

I will rephrase the user's input for better clarity and correctness:

"I would like to reiterate my question: How can an employer in an industry establish a suitable wage schedule for their workers from various job categories? For instance, if 70% of the job categories belong to one employment type, 50% to another, and 30% to a third, how can these categories be aligned with those in the industry?"

Please let me know if you need any further assistance.

Dear Kesav, I think that your interpretation of the term "employment" has given rise to this question. Employment does not indicate just the designation of the job or the nature of the activity to be performed by a hired person in isolation of the industry. On the contrary, under the Minimum Wages Act, though not separately defined, the term "employment" refers to the "scheduled employment" as defined under section 2(g) of the Act only. So, there cannot be any hypothetical situation as you have described.

Thank you for offering your opinion. My question is, which G.O. representing the schedule of employment is to be adopted for my unit? Should it be the G.O. that covers 70% of the employees in our unit, or 50%, or 30%? I understand that I am not entitled to reduce the wages of the existing workers. However, to showcase to the world, which G.O. should be applied to my industrial unit?

Comparison of Employment Schedules

Suppose I have fifteen categories of workers in my unit. Would you like me to compare a category in all three schedules of employment G.O.s and select the highest wage from all three? Should I repeat this process for all fifteen categories? If someone asks about the wages G.O. implemented in my unit, what should my response be?

What is the nature of the industry for which you obtained the license from the Factory Inspectorate? Do you have only one factory employing different categories of workers, or separate factories?

Regards,

N. Nataraajhan
Sakthi Management Services
HP: +91 94835 17402
Email: natraj@sakthimanagemenrt.com

It is a factory manufacturing various engineering spares required for four-wheelers, tractors, diesel engine pump sets, and many more. Fitters, welders, machinists, lathe workers, etc., are working there. The mentioned categories fall under the Scheduled employments, namely:

1) Metal foundries and General Engineerings
2) Automobile Engineerings including workshops
3) Any manufacturing processes of 2(m)(1) and 2(m)(2) of factories.

70% of our employed categories are in the group fixed for Sl. No.1 employment. 50% align with the employment in Sl. No.2, and 30% correspond to the 3rd employment. Out of these, the workers are attracted to the third employment G.O. due to the higher minimum rate of wages for all categories fixed in it.

Decision on Employment Schedule Application

Now, tell me, do you think I should apply the 3rd one for my unit? If your answer is affirmative, how can you justify it, and what statutory or judicial support can be used for your justification?

I feel appreciated if Shri Umakanthan goes through it and offers his valuable opinion. What would be his suggestion if a similar situation arises for the application of a particular G.O. to this unit?

You have not specified the nature of the industry for which you have obtained the factory license. Please also mention the state where your factory is established.

Second Category: Repair Work

As for the second category, it mainly involves repair work, and there may not be much manufacturing activity.

Third Category: Minimum Wage Considerations

There may not be a separate minimum wage notified for the direct workers of the third category, and therefore, you will come under the first category.

Regards,
N. Nataraajhan, Sakthi Management Services
(HP: [Phone Number Removed For Privacy Reasons]; email: [Email Removed For Privacy Reasons])

Understanding Employment Scheduling Under the Minimum Wages Act, 1948

Dear Kesav Panda, the answer to your latest query is very simple. Employments are scheduled under the Minimum Wages Act, 1948, based on the predominant activity of the industry only. For example, take the employment in Public Motor Transport: in this industry, running staff comprises drivers, conductors, checking inspectors, and office staff comprises clerks, typists, and peons, while maintenance staff includes mechanics, fitters, welders, and electricians. Some of these posts can be in any other industry. Therefore, you have to take the rates of minimum wages for such specific employments, jobs, or categories of workmen fixed in the G.O applicable to your industry. There is no necessity to compare with the rates fixed for such/same employments in another industry. If any particular employment is not mentioned, it will fall into the "any other category" mentioned in the G.O.

Regards

Thank you very much, Mr. Umakanthan. According to you, I can apply the G.O. fixed or revised for the public motor transport industry if my running staff and office staff are covered. If they comprise 70%, for the remaining 30%, I have to select a suitable employment where their categories actually fit in. Similarly, in my case, I can best apply to my industry the 70% workers coverage G.O., and according to you, I have to select another suitable employment G.O. for the 30% of leftover employees. Am I right? Thus, you can say it is not on the basis of selecting a higher minimum rate of wage by comparing employments but on higher number of workers coverage. Am I right? If comparison of each category with some employments and picking up a higher minimum rate of wage out of them for application to each category is the perfect solution, there is no need for the Govt. to fix/revise M.wages in 65 employments in our state of A.P. Can any judgment or administrative instructions of any center or state be available to substantiate this version of applicability of an employment to higher worker coverage?

Thank you very much, Mr. Nagaraj. Your version depends upon the payment of higher minimum wages to make the workers happy. But in your discussion, you have also agreed to apply the 70% of workers coverage G.O. Yet, you have reiterated the applicability of a higher minimum wage to the category of employees. Therefore, it’s a dichotomous statement. If I apply the 70% of coverage of workers G.O., I have to pay the rates which appear to be a little lesser than those fixed in other G.Os, and I have to face the impending havoc. If I consider the higher minimum wages, as you believed, then I have to dispense with the more suitable G.O. that is applicable to my industry, and I could well see that there is no purpose of fixing wages in different employments by the State Govt. However, I request you to supply the relevant judgment or provision under any suitable enactment that you rely upon for revealing your version, either on workers coverage or higher Min. wage coverage, as the case may be, which may help me to apply boldly to my industry with a strong base.

Please provide the nature of the industry for which you have obtained a factory license. The applicability of minimum wage depends on the nature of the industry for which you hold the factory license, not on the categories of workers.

Clarification on Applicability of Minimum Wages G.O.

Mr. Umakanthan, I opined that you might have worked as a quasi-judicial officer in your department. That was the due weight given to you, sir. My straight question is: when applying a G.O. relating to employment to an industry, is it based on the coverage of maximum workers or on the basis of higher minimum wages, i.e., selecting higher favorable rates from a comparison of innumerable G.Os?

If a claim is filed under Sec. 20 of the M.W. Act before you, don't you observe which G.O. relating to what employment is applied for the workers in an establishment before taking on file the said claim? If an inappropriate G.O. is applied, don't you return it with objections? That is what happened in my case. Therefore, a question was raised in my mind to get a clarification from an eminent person on how the applicability of a Minimum Wages G.O. is made applicable to an establishment containing different categories, and all those categories are not found in one G.O. Is it clear now? It is not only the applicability to my establishment; a little academic interest is also involved in it. I don't think you people discourage it. Please enlighten now.

Concerns About Factory Inspector Licenses

Now, Mr. Nataraj, have you ever seen a license given by an inspector of factories? Then you can understand to what extent your question is valid. Then you may also correctly catch my point, why I am so much concerned. I have already informed what manufacturing items take place in my industry. Just go through the above, and if possible, enlighten me. Thank you very much for your participation.

Regards

Clarification on Applicability of Minimum Wages G.O.

Mr. Umakanthan, I opined that you might have worked as a quasi-judicial officer in your department. That was the due weight given to you, sir. My straight question is: when applying a Government Order (G.O.) of employment to an industry, is it based on the coverage of maximum workers or on the basis of higher minimum wages, i.e., selecting higher favorable rates by comparing innumerable G.Os?

If a claim is filed under Section 20 of the Minimum Wages Act before you, don't you observe which G.O. relating to what employment has been applied to the workers in that establishment before taking on file the said claim? If an inappropriate G.O. was applied, don't you return it with objections? That is what happened in my case. Therefore, a question was raised in my mind to get clarification from an eminent person on how the applicability of a Minimum Wages G.O. is made to an establishment containing different categories when all those categories are not found in one G.O. Is it clear now? It is not only the applicability to my establishment; a little academic interest is also involved in it. I don't think you people discourage it. Please enlighten me now.

Concerns Regarding Factory Licensing

Now, Mr. Nataraj, have you ever seen a license given by an inspector of factories? Then you can understand to what extent your question is valid. Then you may also correctly catch my point, why I am so concerned. I have already informed you what manufacturing items take place in my industry. Just go through the above, and if possible, enlighten me. Thank you very much for your participation.

Clarification on Scheduled Employment and Minimum Wages

My dear Kesav Panda, I would like to request you to go through all my replies once again with a clear mind so that you can understand that your question has already been answered. However, the following points provided now for elaboration and clarification should be considered beforehand:

- The Act is a pre-Constitution measure intended to achieve social justice for workmen employed in the scheduled employments by prescribing minimum rates of wages for them.

- "Scheduled employment" means an employment specified in the schedule or any process or branch of work forming part of such employment.

- The fixation or revision of the minimum rates of wages can vary according to each scheduled employment, different classes of work in the same employment, classification of employees as adults, adolescents, children, and apprentices, and also according to different localities.

- Once a particular employment is included in the schedule, the minimum rates of wages fixed or revised by the appropriate Government are employment/industry-specific. In other words, the different classes of work or classifications of employees therein cannot be compared with those minimum rates fixed for the same classes of work or classifications of employees in other scheduled employments/industries.

Addressing Your Question on Minimum Wages Applicability

Coming straight to your final and explicit question, drafted as "how is the applicability of a minimum wages G.O. made to an establishment containing different categories when all those categories are not found in one G.O.?" The categories not found in the G.O. would be automatically covered by the classification "any other category" if mentioned. If not, the employer has to set their own rate according to industry practice but not lower than the lowest rate fixed in the G.O. for that grade. For example, in "EMPLOYMENT IN HOTELS AND RESTAURANTS," no minimum wages are set for the category of 'manager', but there is a category of 'asst. manager'. No employee would accept a salary as a manager lower than that of the asst. manager. It should be noted that industries with more unorganized categories or classes of employees are usually included in the schedule, and even in such cases, not all categories are considered for minimum wage fixation. Therefore, it is always better to exercise discretion based on the existing conventions and industry practices.

Regards

Mr. Nataraj,

Against Sl. No. 6 in Form No. 2, I find the maximum number of workers not as you stated. I referred to this information from the A.P. Factory Rules. Can you please tell me from which state's rules you found the nature of the manufacturing process?

Mr. Kesav,

I am not sure about the serial number in Form 2 of AP. However, you should have mentioned the manufacturing process being carried out in your factory while submitting the application for the renewal of the Factory license. The applicability of MW depends on the nature of the manufacturing process that you had mentioned in the application for the renewal of the Factory license.

Thank you.

Clarification on Industry-Specific Minimum Wage Rates

Juxtaposing your two replies manifests as below:

"Therefore, you have to take the rates of minimum wages specific to the employments, jobs, or categories of workmen fixed in the G.O applicable to your industry. There is no necessity to compare with the rates fixed for the same employments in other industries. If any particular employment is not mentioned, it will fall into the 'any other category' mentioned in the G.O."

And

"Thus, once a particular employment is brought under the schedule, the minimum rates of wages fixed/revised by the appropriate Government are employment/industry-specific. In other words, the different classes of work or classifications of employees therein cannot be compared with those minimum rates fixed for the same classes of work or classifications of employees in other scheduled employments/industries."

From these, it is clear that the minimum rates of wages fixed/revised by any government are industry/employment-specific. I need not compare the jobs of one employment with another when one of them best suits my industry. According to you, I can only justify my workers if I apply the G.O relating to the employment "Metal foundries and Genl. Enggs" as 70% of the categories in my industry match those mentioned therein and their nature of work. Therefore, I will now discard the other G.Os, regardless of their higher wages than the present G.O. in question. Thank you very much, sir.

You are correct. However, paying more than the minimum rate of wages applicable to your industry is not forbidden. Whatever provisions relating to benefits capable of quantification set out by law are the minimum only.