Draft of the Code on Wages (Central) Rules 2019

Draft Rules under Section 67 of the Code on Wages 2019

Preliminary draft of the Wages (Central) Rules under Section 67 of the Code on Wages, 2019 -for inputs/comments/suggestions of all Stakeholders

The Ministry of Labour and Employment has prepared a preliminary draft rules under Section 67 of the Code on Wages 2019.

Central Government seeks comments and suggestions on the draft rules within a period of one month from the date of 1st November 2019.

The draft for Code on Wages (Central) Rules, 2019 suggests various modifications including Minimum Wages, revision of Dearness allowance, Number of hours of work in a normal working day, Weekly rest, Night Shifts and Floor wages.

Minimum Wages

Manner of calculating the minimum rate of wages. –

(1) For the purposes of sub-section (5) of section 6, the minimum rate of wages shall be fixed on the day basis keeping in view the following criteria*, namely:-

(i) the standard working class family which includes a spouse and two children apart from the earning worker; an equivalent of three adult consumption units;

(ii) a net intake of 2700 calories per day per consumption unit;

(iii) 66 meters cloth per year per standard working class family;

(iv) housing rent expenditure to constitute 10 per cent. of food and clothing expenditure;

(v) fuel, electricity and other miscellaneous items of expenditure to constitute 20 percent of minimum wage; and

(vi) expenditure for children education, medical requirement, recreation and expenditure on contingencies to constitute 25 percent of minimum wages;

(2) When the rate of wages for a day is fixed, then, such amount shall be divided by eight for fixing the rate of wages for an hour and multiplied by twenty six for fixing the rate of wages for a month and in such division and multiplication the factors of one-half and more than one-half shall be rounded as next figure and the factors less than one-half shall be ignored.

Dearness Allowance

Time Interval for revision of dearness allowance. Endeavour shall be made so that the cost of living allowance and the cash value of the concession in respect of essential commodities at concession rate shall be computed once before 1st April and 1st October in every year to revise the dearness allowance payable to the employees on the minimum wages.

Hours of Work in a Normal Working Day

Number of Hours of work which shall constitute a normal working day.

(1) The number of hours which shall constitute a normal working day under clause (a) of sub-section (1) of section 13, shall be nine hours.

(2) The working day of an employee shall be so arranged that inclusive of the intervals of rest, if any, it shall not spread over more than twelve hours on any day.

(3) The provisions of sub-rules (1) and (2) shall, in the case of an employee employed in agricultural employment, be subject to such modifications as may, from time to time, be determined by the Central Government.

(4) Nothing in this rule shall be deemed to affect the provisions of the Factories Act, 1948 (63 of 1948).

Weekly day of rest

(1) Subject to the provisions of this rule, an employee shall be allowed a day
of rest every week (hereinafter referred to as “the rest day”) which shall ordinarily be Sunday, but the employer may fix any other day of the week as the rest day for any employee or class of employees:

Provided that an employee shall be entitled for the rest day under this sub-rule if he has worked under the same employer for a continuous period of not less than six days:

Provided further that the employee shall be informed of the day fixed as the rest day and of any subsequent change in the rest day before the change is effected, by display of a notice to that effect in the place of employment at the place specified by the Inspector-cum-Facilitator in this behalf.

Explanation.- For the purpose of computation of the continuous period of not less than six days specified in the first proviso to this sub-rule, any day on which an employee is required to attend for work but is given only an allowance for attendance and is not provided with work, a day on which an employee is laid off on payment of compensation under the Industrial Disputes Act, 1947 (14 of 1947), and any leave or holiday, with or without pay, granted by the employer to an employee in the period of six days immediately preceding the rest day, shall be deemed to be days on which the employee has worked.

(2) Any such employee shall not be required or allowed to work on the rest day unless he has or will have a substituted rest day for a whole day on one of the five days immediately before or after the rest day:

Provided that no substitution shall be made which will result in the employee working for more than ten days consecutively without a rest day for a whole day.

(3) Where in accordance with the foregoing provisions of this rule, any employee works on a rest day and has been given a substituted rest day on any one of the five days before or after the rest day, the rest day shall, for the purpose of calculating the weekly hours of work, be included in the week in which the substituted rest day occurs.

(4) An employee shall be granted-

(a) for rest day wages calculated at the rate applicable to the next preceding day; and

(b) where he works on the rest day and has been given a substituted rest day, then, he shall be paid wages for the rest day on which he worked, at the overtime rate and wages for the substituted rest day at the rate applicable to the next preceding day:

Provided that where-

(i) the minimum rate of wages of the employee as notified under the Code has been worked out by dividing the minimum monthly rate of wages by twenty- six; or

(ii) the actual daily rate of wages of the employee has been worked out by dividing the monthly rate of wages by twenty-six and such actual daily rate of wages is not less than the notified minimum daily rate of wages of the employee, then, no wages for the rest day shall be payable; and

(iii) the employee works on the rest day and has been given a substituted rest day, then, he shall be paid, only for the rest day on which he worked, an amount equal to the wages payable to him at the overtime rate; and, if any dispute arises whether the daily rate of wages has been worked out in accordance with the provisions of this proviso, the Chief Labour Commissioner (Central) or the Deputy Chief Labour Commissioner (Central) having territorial jurisdiction may, on application made to him in this behalf, decide the same, after giving an opportunity to the parties concerned to make written representations: Provided further that in case of an employee governed by a piece-rate system, the wages for the rest day, or the substituted rest day, as the case may be, shall be such as the Central Government may, from time to time determine having regard to the minimum rate of wages fixed under the Code, in respect of the employment.

Explanation:- In this sub-rule ‘next preceding day’ means the last day on which the employee has worked, which precedes the rest day or the substituted rest day, as the case may be; and where the substituted rest day falls on a day immediately after the rest day, the next preceding day means the last day on which the employee has worked, which precedes the rest day.

(5) The provisions of this rule shall not operate to the prejudice of more favourable terms, if any, to which an employee may be, entitled under any other law or under the terms of any award, agreement or contract of service, and in such a case, the employee shall be entitled only to more
favourable terms aforesaid.

Explanation:- For the purposes of this rule, ‘week’ shall mean a period of seven days beginning at midnight on Saturday night.

Night shifts

Where an employee in an employment works on a shift which extends beyond midnight, then, –

(a) a holiday for the whole day for the purposes of rule 7 shall, in this case means a period of twenty-four consecutive hours beginning from the time when his shift ends; and

(b) the following day in such a case shall be deemed to be the period of twenty-four hours beginning from the time when such shift ends, and the hours after midnight during which such employee was engaged in work shall be counted towards the previous day

Floor Wages

Manner of fixing floor wage

(1) The Board shall be consulted by the Central Government for the purposes of fixation of basic rate of floor wage under sub-section (1) of section 9 taking into account minimum living standards taking into account an equivalent of three adult consumption units including worker of the family comprising of food, clothing, housing and any other factors considered appropriate by the Central Government from time to time.

(2) The advice of the Board obtained in consultation under sub-rule (1) shall be circulated by the Central Government to all State Governments for consultation with them.

(3) The advice of the Board referred to in sub-rule (2) and the views of the State Governments received in consultation referred to in that sub-rule shall be considered before fixing the floor wage under sub-rule (1).

(4) The Central Government may revise the basic rate of floor wage fixed under sub-rule (1) ordinarily at an interval not exceeding five years and undertake adjustment for variations in the cost of living periodically in consultation with the Board.

12. Manner of consultation with State Governments. The Central Government shall obtain the advice of the Board and consult such State Governments as it think necessary before fixing the floor wage under rule 11.

* The provisions of the rule 3 are based on the criteria declared in the judgment of Workmen represented by Secretary vs. Management of Reptakos Brett.and co. ltd. and Anr., 1992 AIR 504 pronounced by the Hon’ble Supreme Court and of the recommendations of the 15th Indian Labour Conference (ILC).

View and Download the Draft Rules pdf