LAW ON WAGES AND SOCIAL SECURITY

-Shortcomings and gaps

-RamapriyaGopalakrishnan
Advocate, Madras High Court

Important Principles
Labour is not a commodity.
Labour rights are human rights
Laws relating to wages and social security-

to give effect to the Directive Principles of

State Policy and universally accepted
norms of the ILO

WAGES
Minimum Wages Act

Lacunae:
Applies only to scheduled employments
Criteria for fixation of minimum wages not spelt out
Norms decidedat the 15th Labour Conference in 1957-food,

clothing, house rent, fuel, lighting and other miscellaneous

items of expenditure
Workmen v. Management of Reptakos Brett and Co. Ltd. AIR
1992 SC 504
Childrens education, medical requirements, minimum
recreation, provision for old age, marriage etc.

WAGES
Application of the law:
Minimum Wages remain unrevised for long
periods
Example: Garment industry in Tamil Nadu.
Minimum wages revised in 1994, 2004 and 2015
Fixation and revision of minimum wages routinely
challenged
Tamil Nadu Spinning Mills Association v. State of
Tamil Nadu-judgment of VRSJ-30/04/2009
Fixation of minimum wages for apprentices
Held: Notification not to be interfered with except on
the most substantial of grounds.

WAGES
Application of the law:
Minimum wages often not linked to the

payment of dearness allowance

Under-payment
No proper filing of returns
No exclusive machinery for enforcement
Lack of proper enforcement machineryinsufficient training, human resources,
corruption

Equal Remuneration Act

Application of the law:
Violation of the law in the construction

sector, beedi industry, plantation sector

etc.
Non-discrimination part of the Act-not

implemented properly

Payment of Bonus Act

Eligibility threshold-Rs.21,000/Calculation-Rs.7,000/No ceiling either for eligibility of

computation of the quantum of bonus to be

paid

Other shortcomings in the laws

relating to wages
No separate law protecting the right to equal pay for equal

work/equal pay for work of equal value.

Changing nature of employment-increasing informalization
Rules framed under the Contract Labour (Regulation and

Abolition) Act-Rule 25
Considerable disparity between the wages of permanent

workers and other categories of workers doing the same or

similar work
Proposal to increase the minimum wage payable to contract

workers to Rs.10,000/- per month

Implementation gap
Non-payment of overtime wages

Labour Code on Wages Bill.

SOCIAL SECURITY

EPF Act
Restricted coverage
Threshold number
Ceiling for coverage-Rs.15,000/Rules
Restriction on early withdrawal

Application of the law

Contribution deducted from wages-often not

remitted to the fund

ESI Act
Restricted coverage
Threshold number
Ceiling-Rs.15,000/-

Application of the law:

Contribution deducted from wages-often not

remitted to the fund

ESI Hospitals: Poor infrastructure, lack of
proper service, lack of proper treatment

Payment of Gratuity Act

The requirement of at least 5 years of

continuous service in the same

establishment
Non-payment

Maternity Benefits Act

12 weeks of maternity leave insufficient
Proposal to increase maternity leave to 26

weeks (6.5 months)

Maternity leave for surrogate mothers
K.Kalaiselvi v. Chennai Port Trust-judgment

of Chandru J-04/03/2013

Unorganised Workers Social Security

Act, 2008
Empowers the central and state

governments to frame welfare schemes

Proposed Code on Social

Security.
Proposed Code on Social Security.