On 15 March 1948, India enacted the Minimum Wages Act 1948 in order to provide for fixing the minimum rate of wages in certain employments. The need for such an Act was clearly felt. “The justification for statutory fixation of minimum wages is obvious. Such provisions, which exist in more advanced countries, are even more necessary in India, where workers` organisations are yet poorly developed and workers` bargaining power is consequently poor.” 

But in India, cases of violations of minimum wages are rampant. On 20 October 2008, during question hour in the Lok Sabha, an official of the Ministry of Labour and Employment stated that the highest irregularities—78,024 instances reported in the payment of minimum wages in 2006-07 were from Gujarat, followed by Maharashtra and Bihar, which together reported 54,700 cases.

For ensuring the smooth imple-mentation of the Act, labour department officials conducted 2,78,336 inspections in Bihar and 1,15,428 inspections in Gujarat. The Gujarat government imposed Rs 1.32 crores as fine after prosecution, on those who violated the Act and Rs 4.5 crores were awarded as compensation to the workers. According to the ministry sources, Uttar Pradesh tops the list for compensation to workers; it has awarded Rs 9.68 crores as compensation to its workers.

The ministry is still waiting to get the details of enforcement of the Act from 20 states. According to the statistics available, Arunachal Pradesh has the lowest minimum wages, fixed at Rs 55 per day for unskilled workers and Rs 65 for the skilled. Delhi tops this list by paying Rs 142 per day for unskilled workers and Rs 158 for the skilled.

“Minimum wages shall have the force of law and shall not be subject to abatement, and failure to apply them shall make the person or persons concerned liable to appropriate penal or other sanctions,” states the ILO Convention 131—Minimum Wage Fixing Convention 1970. India is yet to ratify this convention.