Double minimum wage or fix it region wise: Panel

A government-appointed panel has recommended that the national minimum wage (NMW) be increased to Rs 375 per day across India from the existing Rs 176 or the states be categorised according to their socio-economic and labour market situation and the wage be provided in a range of Rs 342 to Rs 447.

If the government accepts the proposal for region-wise minimum wage as suggested by the 'Report of the Expert Committee on Determining the Methodology for Fixing the National Minimum Wage', the wage recommended for Karnataka is Rs 414 per day or Rs 11,622 per month.

Karnataka is bracketed along with Gujarat, Kerala, Maharashtra and Tamil Nadu.

The highest wage amount — Rs 447 per day (Rs 11,622 per month)— is recommended for Delhi, Goa, Haryana, Himachal Pradesh and Punjab.

The expert committee, headed by V V Giri National Labour Institute fellow Anoop Satpathy, has recommended the minimum wages on the basis of Consumer Price Index on July 2018 and has taken into account the expenses on food as well as clothing, fuel and light, house rent, education, medical, footwear, transport, entertainment, durable goods and toilet articles among others.

"The Committee is of the considered view that the single value of the NMW for India should be set at Rs 375 per day as of July 2018. This would be equivalent to Rs 9,750 per month, irrespective of sectors, skills, occupations and rural-urban locations," the report, which has fixed a minimum intake of 2,400 calories, 50 gram of protein and 50 gram of fats for calculating NMW along with non-food expenses, said.

Keeping in mind that the cost of accommodation accounts for an over-all non-food component, the committee has also recommended an additional house rent allowance averaging up to Rs 55 per day or Rs 1,430 per month for urban workers, over and above the NMW.

However, this city compensatory rent allowance may be allowed to vary in accordance with the type of city and town.

The panel has also provided an alternate system for calculating the NMW by classifying states into five categories.

While all the Northeastern states except Assam were bracketed together, others were categorised according to their state income, cost of living, labour market situations and levels of women empowerment.

A few states' prevailing wage rates may be higher than the average NMW while poorer states have lower wage rates and it warranted estimating the NMW at regional levels to take care of prevailing socio-economic situations in different states, it reasoned.

However, the report insisted that the states that provide for higher minimum wages than the recommended NMW "should not be allowed to bring down the current levels of state-specific minimum wages and should continue updating every six months in line with price increases".

"The estimated single value of the NMW, or its different value at the regional levels proposed by this Committee, only accounts for the expenditure required to meet the basic level of needs (food and non-food expenditure) of workers and their families. In no way does it reflect any link with the paying capacity of employers, labour productivity and other similar economic criteria... The NMW just meets the criteria for maintaining the work efficiency of workers and the healthy living of their families," it said.

As per the report, Karnataka is bracketed in Region-3 along with other states and Delhi and others in Region-4.

In Region 1, Assam, Bihar, Jharkhand, Madhya Pradesh, Odisha, Uttar Pradesh and West Bengal are bracketed and the committee has recommended that the NMW in these states should be Rs 342 per day (Rs 8,892 per month).

For states— Andhra Pradesh, Chhattisgarh, Rajasthan, Jammu and Kashmir and Uttarakhand— bracketed under Region 2, the recommended NMW is Rs 380 per day (Rs 9,880 per month).

The Northeastern states have been recommended to give Rs 386 per day or Rs 10,036 per month.

Recommended national minimum wage*

Single Value of NMW should be set at Rs 375/day (Rs 9,750/month)

OR

Region wise:

Region I: Assam, Bihar, Jharkhand, Madhya Pradesh, Odisha, Uttar Pradesh, and West Bengal – Rs 342/day (Rs 8,892/month);

Region II: Andhra Pradesh, Telangana, Chhattisgarh, Rajasthan, Jammu and Kashmir and Uttarakhand – Rs 380/day (Rs 9,880/month)

Region III: Gujarat, Karnataka, Kerala, Maharashtra, and Tamil Nadu – Rs 414/day (Rs 10,764/month)

Region IV: Delhi, Goa, Haryana, Himachal Pradesh and Punjab – Rs 447/day (Rs 11,622/month)

Region V: Arunachal Pradesh, Manipur, Meghalaya, Nagaland, Sikkim, Mizoram and Tripura – Rs 386/day (Rs 10,036/month)

* Calculated as on July 2018 Consumer Prices Index

Source: Report of the Expert Committee on Determining the Methodology for Fixing the National Minimum Wage