Minimum Wage Confusion: How to Calculate Pay for Months with 27 Working Days?

Minimum wage notification declares wages for daily and for 26 days of working wages. For example, in State A, daily minimum wages are Rs 300/-, and for 26 days, it is Rs 7800/- (including rest days).

Now, my question is, if a month has more than 26 days (e.g., 27 days) of working, then "what would be the minimum wages for that particular month"? Since if the same wages are provided to an employee for working 27 days in the month, that will actually make his/her daily wages less than the notified wages.

Dear Rahul, this question has already been answered several times before. For all practical purposes, as a matter of close approximation, a month is deemed to have 30 days irrespective of the actual number of days in the month. Therefore, to arrive at the daily rate of wages in case of the fixation of the minimum wages being per month, the monthly rate has to be divided by 26. To arrive at the monthly rate in the case of fixation being per day, the daily rate of wages has to be multiplied by 30. You may find a note as above in the Government Order relating to the fixation or revision of minimum wages by the appropriate Governments.

Dear Sir, does it mean the daily rate of wages and monthly wages can be different? According to section 7(b) IV of the Minimum Wage Act: "by such other larger wage-period as may be prescribed, and where such rates are fixed by the day or by the month, the manner of calculating wages for a month or for a day, as the case may be, may be indicated."

Here, the government not only declares monthly wages but also daily wages. I think I should present my case with the help of an example. If a company appoints two employees for the same work, one as a daily wager and the second as a permanent worker at Rs 300 per day for 27 days, the daily wager will earn Rs 8100. On the other hand, an on-roll worker will get Rs 7800. Will that not go against the Supreme Court judgment of "Equal pay for equal work"?

Dear Rahul, the section you quoted is 3(3)(b) of the Minimum Wages Act, 1948, relating to the fixing of minimum rates of wages. If you read the above subsection carefully once again, you will understand that the appropriate Government is required to indicate the manner of calculation of the minimum wages by the other rate if it is fixed by one rate among the two, viz., the monthly rate or the daily rate. Therefore, it implies that the Government can fix the minimum wages only by the monthly rate or the daily rate for any post and not by both. That's why there is an explanatory note under every such Government Order indicating the method of calculation for conversion, as stated by me earlier.

Coming to your example, if the minimum wages fixed are a monthly rate, the on-roll/regular employee would get Rs. 9,000.00 irrespective of the actual number of days in a month. The daily wager appointed to the same post would earn Rs. 346.15 per day (9000/26) and not Rs. 300 per day. You know well that you cannot allow a workman, whether he is regular or casual on daily wages, to work continuously all 7 days in the week as per the provisions of Rule 23 of the Minimum Wages (Central) Rules, 1950, or the corresponding State Rules, as the case may be. In this manner, the parity between the monthly earnings of the regular workman and the daily wager holding the same post would be maintained.