Hike in Delhi's Minimum Wages A Welcome Step

WHILE welcoming the Delhi Government's announcement of hiking minimum wages by fifty percent and proposed amendments to Minimum Wages Act, 1948 AICCTU has drawn attention to the fact that after coming to power, the Kejriwal government, like its predecessors, has failed miserably to implement statutory Minimum Wages in Delhi. Employers in Delhi are able to make a mockery of the existing weak Minimum Wages Act, 1948, CLARA Act and other labour laws with impunity. The Kejriwal Government has failed in implementing labour laws and nailing contractors even in Public Sector and Delhi Government-owned establishments, not to speak of private sector units. At present the penal provisions in Minimum Wages Act throughout the country are so weak that no employers feel any pressure to implement them.

Unless these laws are made meaningful – by making the offence of non-payment of Minimum Wages cognizable and non-bailable and ensuring its strict implementation, it's quite likely that announcement would only benefit a very small proportion of workers of Delhi, while largely it will remain a propaganda gimmick because more than ninety percent of the workers are forced to work on a fraction of prescribed minimum wage rates with full impunity to law breaking employers.

By keeping the penal provisions weak, employers are given an incentive to ignore the labour laws in order to weaken the collective bargaining powers of workers. The punishment for not paying minimum wages is just Rs. 500 or 6 months imprisonment. Moreover, aggrieved workers have no right to register the case if full wage payment is violated unless a prior permission is obtained from the 'appropriate Government.' A poor person doing petty theft of food for survival can be given jail term of 2 years but those making millions out of theft of legal wages are never sent to Jail! Delhi government has now proposed a penal provision of Rs 50,000 or 3 years imprisonment or both for non-payment of minimum wages. The punishment for general violations of the Act - not keeping records, registers etc - has also been enhanced from Rs 500 to Rs 20000 or 1 year or both. The amendments also make it obligatory that courts should decide the matter of violations of minimum wages in three months. It also extends similar protection granted under Industrial Disputes Act, 1947 to Minimum Wages Act, 1948 that no worker should be retrenched, dismissed, terminated, laid-off without the permission of the authority before whom matter is pending.

AICCTU, Delhi in written submissions to the Delhi Labour Minister had demanded that the violation of prescribed statutory minimum wages be treated, not as a mere economic offence but one in violation of the fundamental right to dignified life under Article 21 of the Constitution of India. The proposed amendment by the AAP Government, though in a positive direction falls far short of what is desired to bring meaningful change towards ensuring implementation of Minimum Wages Act. It is well known that under the present law no one is punished with six months jail term even in case of conviction which in itself is rarity – and the proposed amendments are yet to recognise non-payment of minimum wages as a criminal offence. Merely raising the jail term in the law cannot change the fact that the courts tend not to send offenders in these cases to jail at all.

Moreover, the proposed amendment doesn’t make any change in Section 22-B of the Act which deals with cognizance of offence. It continues to remain a non-cognizable offence with provision that no court can take cognizance of the offence under the Act without the complaint being filed by appropriate government or officer authorized by it. With no fear of going to jail for the serious offence of not paying minimum wages the implementation will continue to be as elusive as ever. The labour department has to be given teeth as well as a sufficient force of labour inspectors to implement the laws at ground level. Presently Delhi has mere 10-12 inspectors to see that the labour laws are followed for more than 50 lakh workers in Delhi! (there are 8.93 lakh registered establishments in Delhi employing 29.85 workers according to 6th economic census, 2013, whereas unofficial estimate for un-registered production entities is approximately 20 lakhs.) Out of five working days in a week Delhi's Labour Department has allotted one day for child labour inspection, another one day is reserved for attending court and other proceedings, leaving only remaining three days for administrative work, meetings and labour inspection purposes. One can imagine how the 12 inspectors can cover such a huge number of establishments, millions of working people, do inspections and attend to complaints. In tune with the ongoing nationwide onslaught of labour rights, labour department have become nominal and formal.

Delhi's existing minimum wage for unskilled workers is Rs. 9568 per month for eight hour working day. The actual wage rates prevailing are as low as Rs. 3500-5000. No one can survive on this meager amount so workers routinely do overtime for four hours, resulting in a 12 hour working day, eventually making the monthly payment to Rs. 5250-7500. This is without any extra benefit of overtime which legally should have been double the amount of normal per hour wage rate. This way, an unskilled worker who ought to receive a monthly wage for 12 hours work Rs. 19136 at legally prescribed rates, actually gets only Rs. 5250. He/she loses Rs. 13886 (19136 minus 5250) every month as wages. Now minimum wage for unskilled workers has been increased from Rs. 9568 to Rs. 14052. If non-implementation of Minimum Wage Act continues then this will also mean that a worker who was losing Rs. 13886 every month will now lose fifty percent more money as wages in theory, while practically nothing will change in his or her life!

Secondly, the Delhi government has not yet proposed any amendment in Contract Labour (Regulation & Abolition) Act, 1970 (CLARA) to make it effective for workers. Moreover, it has not implemented the promise of regularization of workers, or the principle of 'equal pay for equal work' in establishments under Delhi government's jurisdiction. The existing penal provisions of CLARA, 1970 need to be strengthened for effective implementation. It is common knowledge that principal employers and contractors work in collusion to ensure the violations of the Act. The minimum wages law violations are most rampant through the contractor route.

The three months time limit for courts would only be effective if the numbers of courts are increased. The protection granted from retrenchment in case of complaint pending before the authority is also not likely to make much impact in view of the ineffectiveness of an existing similar provision under Industrial Disputes Act, 1948. The employers resort to tactics of firing employees as soon as they began to unionise because of the weak provisions under Industrial Disputes Act, 1948 and the reinstatement process even for glaring illegality on part of the managements takes years to bear fruit – a delay that employees simply can't afford. In effect, the law is used for union-busting instead.

The hike in wages and the changes proposed in law by AAP government are undoubtedly a welcome step which have a potential to send a positive message across sections of society. But to ensure that the minimum wage actually reaches each worker, strengthening the legal framework and implementation machinery at the level of governance is a must. This is what India's trade unions are fighting for in the face of the Modi government's anti-worker labour law reforms and Make in India projects. Will Delhi's Kejriwal government show more seriousness and will power in implementing its own poll promise of ensuring minimum wage rates to all and regularizing contract workers?

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