Dear All Seniors,
I am very confused about components that are included in minimum wages. Does minimum wages mean minimum CTC, minimum gross salary, or minimum basic salary? Please provide valuable suggestions.
From India, Mumbai
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1I am very confused about components that are included in minimum wages. Does minimum wages mean minimum CTC, minimum gross salary, or minimum basic salary? Please provide valuable suggestions.
From India, Mumbai
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The Minimum Wages Act is directed by the Labour Department of the government. Every six months, they declare the rates of minimum wages based on the category of the establishment or factory. It consists of only the basic wage plus dearness allowance (DA) only.
From India, Pune
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From India, Pune
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I am sending a link to you. Kindly go through the contents.
[Report on the Working of the Minimum Wages Act](http://labourbureau.nic.in/MW%202k3%20Introduction.htm)
From India, Delhi
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[Report on the Working of the Minimum Wages Act](http://labourbureau.nic.in/MW%202k3%20Introduction.htm)
From India, Delhi
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What are all the components included in the Minimum Wages Notification you are referring to? Please share the same.
Minimum wages mean the bare minimum salary to be paid to an employee. CTC means the cost to the company, including the employer's share of statutory contributions, the cost of other monetary benefits paid to an employee, uniform cost, cafeteria subsidy, transportation cost, etc.
From India, New Delhi
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Minimum wages mean the bare minimum salary to be paid to an employee. CTC means the cost to the company, including the employer's share of statutory contributions, the cost of other monetary benefits paid to an employee, uniform cost, cafeteria subsidy, transportation cost, etc.
From India, New Delhi
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Difference in Minimum Wages Across Industries
Almost all state governments are notifying minimum wages for various industries with different wages and Dearness Allowance (DA). There is a significant difference in wages and DA for different industries. Can any government justify this difference? While the DA is common for all categories of employees in a particular industry, why should there be a difference in wages and especially DA for different industries? Can the government assure different prices in vegetables or groceries for a worker in an engineering industry and construction field? Experts, could you explain the rationale for such decisions by state governments?
Thanks and Regards,
N. Nataraajhan
Sakthi Management Services
[Phone Number Removed For Privacy-Reasons]
From India, Bangalore
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Almost all state governments are notifying minimum wages for various industries with different wages and Dearness Allowance (DA). There is a significant difference in wages and DA for different industries. Can any government justify this difference? While the DA is common for all categories of employees in a particular industry, why should there be a difference in wages and especially DA for different industries? Can the government assure different prices in vegetables or groceries for a worker in an engineering industry and construction field? Experts, could you explain the rationale for such decisions by state governments?
Thanks and Regards,
N. Nataraajhan
Sakthi Management Services
[Phone Number Removed For Privacy-Reasons]
From India, Bangalore
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Minimum wages differ from industry to industry and state to state. Minimum wages are based on the type of industry, skill requirements, nature of job performed, categorization of employees, and job output.
On the other hand, variable dearness allowance is linked to the Consumer Price Index.
From India, New Delhi
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On the other hand, variable dearness allowance is linked to the Consumer Price Index.
From India, New Delhi
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Understanding Minimum Wage Components
1. Minimum wage is generally considered the minimum gross salary, but there is a difference of opinion on this matter.
2. Some consultants advise that the monthly gross wages are the minimum wages, whereas others believe that the basic wage and dearness allowance/special allowance are the components of minimum wages.
3. CTC is not a legal term; it is purely a commercial term. Hence, when dealing with minimum wages (which is a legal term), forget about CTC as it is not a recognized concept under labor laws.
From India, Thane
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1. Minimum wage is generally considered the minimum gross salary, but there is a difference of opinion on this matter.
2. Some consultants advise that the monthly gross wages are the minimum wages, whereas others believe that the basic wage and dearness allowance/special allowance are the components of minimum wages.
3. CTC is not a legal term; it is purely a commercial term. Hence, when dealing with minimum wages (which is a legal term), forget about CTC as it is not a recognized concept under labor laws.
From India, Thane
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Definition of Wages Under the Minimum Wages Act
Even though the Minimum Wages Act defines "wages" as all remuneration capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes house rent allowance, it does not include:
(i) the value of:
(a) any house-accommodation, supply of light, water, medical attendance, or
(b) any other amenity or any service excluded by general or special order of the appropriate Government;
(ii) any contribution paid by the employer to any Pension Fund or Provident Fund or under any scheme of social insurance;
(iii) any travelling allowance or the value of any travelling concession;
(iv) any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or
(v) any gratuity payable on discharge.
State Regulations on Basic Salary and Minimum Wages
In some states, the authorities are making it compulsory that the Basic Salary defined in the Salary structure should be equivalent to the Minimum Wages declared. They claim that the employer, in order to keep the PF contribution less, defines Basic salary lesser than the Minimum wage declared. In such cases, they are also insisting that the salary needs to be restructured with immediate effect.
Can I have your views on the same?
From India, Mumbai
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Even though the Minimum Wages Act defines "wages" as all remuneration capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes house rent allowance, it does not include:
(i) the value of:
(a) any house-accommodation, supply of light, water, medical attendance, or
(b) any other amenity or any service excluded by general or special order of the appropriate Government;
(ii) any contribution paid by the employer to any Pension Fund or Provident Fund or under any scheme of social insurance;
(iii) any travelling allowance or the value of any travelling concession;
(iv) any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or
(v) any gratuity payable on discharge.
State Regulations on Basic Salary and Minimum Wages
In some states, the authorities are making it compulsory that the Basic Salary defined in the Salary structure should be equivalent to the Minimum Wages declared. They claim that the employer, in order to keep the PF contribution less, defines Basic salary lesser than the Minimum wage declared. In such cases, they are also insisting that the salary needs to be restructured with immediate effect.
Can I have your views on the same?
From India, Mumbai
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(Fact Checked)-The user's reply provides an accurate explanation of the components excluded from the definition of wages under the Minimum Wages Act and the issue of Basic Salary compliance with Minimum Wages in some states. No corrections needed. (1 Acknowledge point)
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Dear Patil Jee,
Very good wishes. Minimum wage means basic salary + DA. (The minimum rates of wages notified are the basic rate of minimum wages, which are not permitted to be segregated into components in the form of allowance by the employer.)
A notification from HR Gov has also been uploaded. After viewing it, things should be crystal clear to you.
Thank you,
Ashutosh
HR Gen
From India, Delhi
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Very good wishes. Minimum wage means basic salary + DA. (The minimum rates of wages notified are the basic rate of minimum wages, which are not permitted to be segregated into components in the form of allowance by the employer.)
A notification from HR Gov has also been uploaded. After viewing it, things should be crystal clear to you.
Thank you,
Ashutosh
HR Gen
From India, Delhi
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(Fact Checked)-The user reply is correct in stating that minimum wage typically includes the basic salary and dearness allowance. However, it's worth noting that minimum wages may vary based on the category of workers and the region. It's essential to comply with the specific minimum wage regulations applicable to the industry and location. (1 Acknowledge point)
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SALARY CAN BE SPLIT INTO COMPONENTS BUT NOT LESS THAN THE MINIMUM WAGES.docx
Minimum Wages Act & Rules Wage Slip Form No.XI-Rule (26(2.) .pdf
CiteHR.AI
(Fact Checked)-The user's reply contains valid points regarding the variations in minimum wages and dearness allowance across different industries. However, the user's inquiry about justifying these differences and the rationale behind them is relevant. (1 Acknowledge point)