The Minimum Wages Act, 1948 and the Code on Wages, 2019 differ significantly in their scope, structure, and provisions. Here’s a detailed comparison:
Sr. no | Point of Difference | Minimum wages Act, 1948 | Code on Wages, 2019 |
1.
| Objective | The main goal of the Minimum Wages Act, 1948, was to make sure that workers get paid enough money to live a basic, decent life.
| The Code on Wages, 2019, combines four old wage laws into one simple law. The Minimum Wages Act, 1948; the Payment of Wages Act, 1936; the Equal Remuneration Act, 1976; and the Payment of Bonus Act, 1965. Its goal is to make it easier for everyone to follow the rules about paying workers fairly and on time. |
2.
| Scope and Coverage | The main focus is to set minimum wages for workers in certain listed jobs. It applies to specific industries mentioned in the schedule of the Act. | It combines and simplifies the rules from four old labour laws: The Payment of Wages Act, 1936; the Minimum Wages Act, 1948; the Payment of Bonus Act, 1965; and the Equal Remuneration Act, 1976. It applies to organized as well as unorganized sectors.
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3. | Determination and Fixation of Wages | The Central and State Governments can set minimum wages for certain jobs listed in the schedule. These minimum wages must be reviewed and updated at least every five years. | The Central and State Governments still set minimum wages but now consider factors like skill level, difficulty of the job, and location. There’s also a “floor wage” set by the Central Government, which is the lowest limit for minimum wages in any state. This includes rules about how and when wages should be paid.
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4. | Payment and Mode of wages | Wages must be paid in cash, unless the government allows some payment in goods. Wages should be paid at least once a month. | All wages shall be paid in current coin or currency notes or by cheque or by crediting the wages in the bank account of the employee or by the electronic mode |
5. | Enforcement and Penalties | Inspectors and advisory boards make sure the rules are followed. There are penalties if rules are broken, but they might not be as strict as newer standards.
| It introduces “Inspectors-cum-Facilitators” who help both employers and workers follow the rules and improve compliance. There are different penalties for different rule violations, and some offenses can be resolved without going to court. |
Similarities between the Minimum Wages Act, 1948 and the Code on Wages, 2019
The Minimum Wages Act, 1948, and the Code on Wages, 2019, have several similarities, as the latter amalgamates and builds upon the provisions of the former. Here are the key similarities:
Objective:
Both legislations aim to ensure that workers receive a minimum wage to protect them from unduly low pay.
Coverage:
The Minimum Wages Act of 1948 originally only covered certain types of jobs, known as scheduled employments. But the Code on Wages from 2019 covers all types of jobs, whether they’re in organized or unorganized sectors. This means that now, all workers are entitled to minimum wage protection, ensuring fair pay for everyone, regardless of the type of work they do.
Authority to Fix Wages:
Both the Minimum Wages Act of 1948 and the 2019 Code on Wages allow the Central and State Governments to set and adjust the minimum wages. This means they have the power to decide the least amount workers should be paid in their regions.
Components of Minimum Wages:
The Minimum Wages Act of 1948 and the Code on Wages from 2019 permit minimum wages to consist of a basic rate along with a cost of living allowance. Additionally, the Code on Wages allows for the inclusion of other elements as required by the government. This means that besides the basic pay and cost of living adjustment, the government can decide to add more components to the minimum wage if they find it necessary.
Procedure for Fixing and Revising Wages:
Both laws have a process for regularly reviewing and updating minimum wages. This helps make sure that wages stay fair and keep up with changes in living costs.
Timely Payment of Wages:
Both the Minimum Wages Act and the Code on Wages require employers to pay wages on time. The Minimum Wages Act applies this rule to employees in scheduled employments, while the Code on Wages extends it to all workers universally, regardless of their type of employment.
Enforcement Mechanisms:
The Minimum Wages Act had inspectors to check if employers followed the rules. The Code on Wages updates this by introducing Inspectors-cum-Facilitators. These inspectors not only ensure compliance but also help by providing information and making it easier for employers to follow the rules.
Non-Discrimination:
Both laws make it illegal to pay someone less based on their gender. The Code on Wages strengthens this by explicitly banning discrimination in anything related to wages. These similarities show how the protections for workers have evolved and grown from the Minimum Wages Act of 1948 to the more detailed rules in the Code on Wages of 2019.
Conclusion
The Minimum Wages Act, 1948 laid the groundwork for protecting workers through legally fixed minimum wages, but its coverage was limited to scheduled employments. The Code on Wages, 2019 expands this protection to all workers, simplifies compliance by merging multiple laws, and strengthens enforcement through updated mechanisms. Overall, the Code creates a more uniform, inclusive, and modern wage framework that ensures fair pay and better wage regulation across all sectors.
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