How Should We Respond to the Labor Department About Skilled Workers' Salary Differences?

If there is substantial variation in the salary of skilled category workers, what could be the right reply to the labor department.

Dear Pankaj, the quality of any reply to a contentious issue depends on the occasion that gives rise to the issue. What prompts such a reply to the Labor Department? Is there an industrial dispute regarding the revision of wages based on the principle of equal wages for equal work? Is there a claim relating to the non-payment of minimum wages? What are the reasons for the substantial difference in wages when the workmen belong to the same or similar category in terms of skill levels? Without a conspectus with such particulars, it is challenging to provide a convincing reply.

If we are paying more than minimum wages but variance is there?

If we are paying more than minimum wages, but there is still variance in pay, we should investigate the reasons behind this discrepancy.

Hello Mr. Pankaj,

What was the query from the Labour Department to begin with? Paying minimum wages is mandatory to be compliant with laws. What kind of variance is there in wages - between trades/different skilled workers or within the same skills based on seniority, performance? For getting a good reply/suggestions, you need to be more descriptive of the problem faced. Did you get any letter from the Labour Department? What was the query?

Substantial variation exists in the salaries of workers based on their designation. The department has requested a written explanation regarding the salary discrepancies. The variations in pay are linked to different roles such as Driver, Casual Operators, Office Boy, HK Supervisors, and Guesthouse Cook. However, in the documentation, all these positions were labeled as "helper."

Designation will have to be changed to reflect the actual work being done. Are you paying more than minimum wages for each category of worker - driver, etc.? The exact wording of the query can be posted for better understanding. How did the query come about? Was it due to a complaint or a random visit by a labor inspector?

Wages payable over and above the Minimum Wages prescribed for the schedule of employment, comprising different components including Basic and DA, would amount to a statutory violation. In this case, if the sum of Basic and DA payable exceeds 55% of the total Minimum wages prescribed under the statute, it raises a concern of non-compliance.

I would recommend reviewing the wage structure to ensure compliance with statutory requirements. It is essential to adhere to the regulations to avoid any legal implications or penalties.

Request expert views, please.

Regards,

Thank you so much, Sri Umakanthan Sir, for your detailed answer to my query in determining the MW components. Your advice concerning the social security on employees' side is well taken by us.

Regards,

Dear Pankaj, the clarification sought by the labor department on the variance of the wages paid to categories of workmen is justified, which is evident from your clarification. As per you, some skilled category workmen are paid under the minimum rate of wages of the USK category, whereas they fall under the SK (Driver, Casual Operators, Office Boy, Supervisors & Guesthouse Cook) category. You cannot call it a substantial variation but rather a serious violation. This can be treated as a willful violation of minimum wages. As an employer willfully (a) pays to any employee less than the minimum rates of wages fixed for that employee's class of work or less than the amount due to him under the provisions of this Act or (b) contravenes any rule or order made under section 13; shall be punishable...

If your rate of payment is equal to or more than the original skill category to which the workmen belong, then the category maintained in the register is not that serious and can be said to have happened due to a clerical mistake. But if the rate of wages paid to those workmen is less, it is to be considered a violation. In this regard, you have to rectify your register as per the skill and pay the variation amount from the date their name was borne in the muster roll till date.