Each state fixes minimum wages for different levels of skills
Q. The minimum wages for workers are fixed by- Published on 09 May 16a. States
b. Union Cabinet
c. Union Labour Ministry
d. Finance Commission
ANSWER: States
- The current system is that each state fixes minimum wages for different levels of skills, based on local conditions.
- At the macro-level since 1948, the minimum wages were always fixed by states looking at the cost of living in the state and demand-supply situation. Wage level varies for different industry segments and skill-sets.
- As per a study by the VV Giri National Labour Institute in 2011, there were 3.6 crore contract labourers in the country. The study also said that 30 per cent of all workers in private sector and around 32 per cent in the public sector are employed through contractors.
- Union govt. is planning to increase the minimum wage to Rs.10,000 per month regardless of the categorisation of skilled and unskilled workers. This becomes arbitrary. Many labour-intensive sectors such as apparel industry employ a lot of unskilled labour. If you take the minimum wage level to such a high level, the industry will then start looking at automation intensely.
- The move is seen as an encroachment on the states’ power.
