The Minimum Wages Act, 1948 is more than just a legal framework it's a tool of social justice that bridges constitutional principles with economic realities. It authorizes both Central and State Governments to set minimum wages for scheduled employments, ensuring workers receive at least a legally mandated base pay. These wages include basic pay and certain allowances, but exclude benefits like HRA, overtime, and bonuses. The Supreme Court has upheld the Act as a welfare legislation, emphasizing its role in fighting poverty and improving workers' conditions.

Background of the minimum wages Act

Before the Minimum Wages Act of 1948, Indian workers especially in unorganised sectors were often paid wages too low to survive on. While the Payment of Wages Act (1936) ensured timely payment, it didn't guarantee fair pay. With no legal wage floor, exploitation was widespread. As industrialisation and worker movements grew, calls for economic justice intensified. In response, and in the spirit of post-independence reform, the Minimum Wages Act was enacted to protect vulnerable workers and ensure fair compensation in sectors lacking bargaining power.

Minimum Wage

The minimum wage is the lowest amount an employer is legally allowed to pay a worker. It's not just a number — it's a guarantee that no one who works full-time should live in extreme poverty. It helps workers afford the essentials of life — food, shelter, clothing, and basic dignity.

Living Wages

A living wage goes beyond mere survival — it ensures a life of dignity by covering not just basic needs, but also healthcare, education, and some savings. Unlike the minimum wage, which is legally enforceable and often insufficient, the living wage is a moral ideal, promoting comfort and stability.

Fair Wages

A fair wage sits between the minimum and living wage. It balances what a worker needs and what an employer can afford, often reached through collective bargaining. More than numbers, it reflects the human value of labor, fostering respect and trust between workers and employers.

The Constitutional Backbone of the Minimum Wages Act

The Minimum Wages Act, 1948 isn't just another piece of labor legislation - it stands on the strong shoulders of the Indian Constitution. It draws its strength from the core values of justice, equality, and dignity for all citizens, especially those whose voices are often the faintest: the workers.

• Article 14 (Equality Before the Law): Ensures that vulnerable workers aren't left behind, supporting fair wages to reduce inequality.
• Article 23 (Prohibition of Forced Labour): Protects against exploitative wages that trap workers in harsh conditions.
• Article 39 (Directive Principles): Calls for adequate livelihoods honoured by legally guaranteeing a minimum wage.
• Article 43 (Living Wage & Work Conditions): While the Act enforces only a minimum wage, it echoes the constitutional goal of a dignified life through fair pay and decent work conditions.
  

How Minimum Wages Are Set and Reviewed

Wages aren't just numbers — they're a reflection of how we value human effort. That's why setting the minimum wage isn't left to chance or the whims of the market. It's a carefully structured process, backed by law and informed by lived realities.

Who Decides the Rates and How Often?

Both the Central and State Governments are empowered to fix and revise minimum wages, depending on the nature of employment. For example, a worker in a tea plantation in Assam might fall under the state's jurisdiction, while someone working on a railway project might come under the Centre. The law says minimum wages must be revised at least every five years, but many states update them more frequently — sometimes even twice a year — especially to adjust for inflation and cost of living changes.

Consultation and Review

Before setting or changing a wage, the government doesn't just crunch numbers in an office. It engages in a consultative process. Two primary methods are used:

1. Committee Method: The government forms expert committees made up of employers, workers, and independent members to study wages and submit recommendations.
2. Notification Method: Draft proposals are published, and the public is invited to offer suggestions or objections. Only after considering these inputs are the rates finalized.

This process ensures that the voices of those who earn and pay the wages are both heard. It's a balancing act between economic viability and human dignity.

When Wages Fall Short: Raising Claims and Seeking Justice

Despite the law, there are still times when workers are underpaid or not paid at all. But the Minimum Wages Act doesn't stop at just fixing the wages — it also provides a path to justice.

How Can Workers Raise Disputes?

If a worker is paid less than the legal minimum, or faces unlawful deductions, they have the right to file a claim. This can be done by:

• The worker themselves
• A trade union or legal representative
• A government-appointed inspector

Who Handles These Cases
A designated Authority often a Labour Commissioner or Judicial Magistrate—is appointed to hear and decide such disputes.

Way forward
Implementation gaps weaken the impact of the Minimum Wages Act. Many workers remain unaware of their rights, and enforcement is often lax. Stronger inspections, real penalties, and better awareness especially in local languages are key. Looking ahead, reforms must align wages with inflation and living costs, shifting the focus from mere survival to enabling workers to truly thrive.

Conclusion
The Minimum Wages Act, 1948 was introduced to protect vulnerable workers and ensure fair pay. While it marked a step toward economic justice, today's realities show a stark gap between legal minimum wages and the actual cost of living. For many, especially in the informal sector, minimum wages offer mere survival, not stability or dignity.