Revised wage rate index likely next month; base year to be 2019

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The government will soon revive the wage rate index and change its base year to 2019 from 1965. The revised index will capture the impact of inflation on wages and form the basis for determining the statutory national floor level minimum wage, said officials.

“Work is in the final stages. The index with revised base year could be launched next month,” said a senior labour ministry official, who did not wish to be identified. “The appreciation in the index till 2019 will be used to determine the minimum wages in the country.”

The labour codes provide for a statutory national floor level minimum wage for all workers in the country. A committee has been formed to determine the national floor level minimum wage, based on which minimum wages in different categories of states and skill sets will be determined. Once implemented, no state will be allowed to give wages below the minimum wage.

Agencies

In 2014, average daily absolute wage rate in the country stood at ₹272.19 while the all-India index number of wage rates appreciated 6.35% compared to that in 2013.

The current minimum wages in India, determined on the basis of Consumer Price Index for Industrial Workers (CPI-IW), stands at ₹178 per day and is not binding on states.

Wage rate under the index is the sum of basic wage and dearness allowance in respect of workers who receive both these components while for other workers the actual consolidated amount of earnings represent this wage rate.

“The government should not only revise the base year but also expand the coverage of the index to include more establishments so that it can be used as one of the critical inputs for determining the national floor level minimum wage,” said labour expert KR Shyam Sundar.

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