Ensuring Wage Justice
The Code on Wages, 2019 (“Code”) represents a landmark legislative reform in Indian labour law consolidating multiple pre existing statutes into a unified framework governing wages, minimum wages, bonus and related employment conditions. Among its important structural features are the provisions relating to the advisory boards, the mechanisms for payment of dues, claims and audit and the role of the Inspector-cum-Facilitator. These components collectively strengthen institutional oversight, ensure timely delivery of wage related benefits and facilitate compliance and dispute resolution. While the advisory boards, both at the Central and State levels, provide consultative inputs on wage fixation and women’s employment, the Code also empowers authorities to ensure accountability in employer payments, streamline claims procedures and enhance transparency through audit rules. The Inspector-cum-Facilitator, as a designated enforcement functionary, further anchors the Code’s objectives by enabling on ground inspections, guidance and statutory enforcement.
Who is responsible for constituting the Central Advisory Board and who are its members?
The Central Government shall constitute the Central Advisory Board. The Board shall consist of persons nominated by the Central Government representing:
(a) employers;
(b)
employees, who shall be equal in number to the members representing employers;
(c)
independent persons not exceeding one-third of the total members of the Board; and
(d)
five representatives of such State Governments as may be nominated by the Central Government.
What is the requirement regarding women members and the Chairperson of the Central Advisory Board?
One third of the members of the Central Advisory Board shall be women, and one member from among the independent persons shall be appointed by the Central Government as the Chairperson of the Board.
What advisory functions does the Central Advisory Board perform?
The Central Advisory Board shall advise the Central Government on issues relating to:
(a)
fixation or revision of minimum wages and other connected matters;
(b)
providing increasing employment opportunities for women;
(c)
the extent to which women may be employed in such establishments or employments as may be specified by notification; and
(d)
any other matter relating to the Code.
Based on such advice, the Central Government may issue directions to the State Governments as it deems fit.
What obligation is placed upon State Governments regarding Advisory Boards?
Every State Government shall constitute a State Advisory Board to advise the State Government on:
(a)
fixation or revision of minimum wages and other connected matters;
(b)
providing increasing employment opportunities for women;
(c)
the extent to which women may be employed in such establishments or employments as may be specified by notification; and
(d)
any other matter relating to the Code referred to the Board by the State Government.
Can the State Advisory Board constitute committees or sub committees?
Yes, the State Advisory Board may constitute one or more committees or sub-committees to look into issues pertaining to matters specified for its consideration.
How are the State Advisory Board and its committees or sub-committees composed?
They shall consist of persons representing:
(a)
employers;
(b)
employees, equal in number to employer representatives; and
(c)
independent persons, not exceeding one-third of the total members.
What are the provisions regarding women members and Chairpersons in the State Advisory Board and its committees?
One-third of the members shall be women. One independent member shall be appointed as:
(a)
Chairperson of the Board by the State Government; and
(b)
Chairperson of a committee or sub-committee by the State Advisory Board.
What factors must the State Advisory Board consider while advising on women’s employment matters?
The Board shall consider:
(a)
the number of women employed;
(b) nature of work;
(c) hours of work;
(d)
suitability of women for employment;
(e)
need for increasing employment opportunities, including part-time employment; and
(f)
such other relevant factors as it deems fit.
What powers does the State Government have after receiving advice from the State Advisory Board?
The State Government may, after considering the advice and representations from establishments, employees, or other persons, issue such directions as it deems necessary.
Who regulates the procedure of the Central and State Advisory Boards?
The Central Advisory Board and the State Advisory Board shall regulate their own procedure, including that of committees and sub-committees, in the manner prescribed.
What determines the term of office of Advisory Boards and their committees?
The terms of office of the Central Advisory Board, State Advisory Board, and their committees and sub-committees shall be as prescribed.
What principle governs nomination to committees for revision of minimum wages?
Representation by nomination is well accepted. A nominee need not be an employer himself and may be an employee competent to represent the employer’s interest. Such nominee represents the employer’s interest and not an individual capacity.
Who is responsible for payment of dues under the Code?
Every employer shall pay all amounts required under the Code to every employee employed by him.
Who is responsible if the employer fails to make payment?
The proprietor, company, firm, association, or any other person owning the establishment shall be responsible.
How are undisbursed dues handled in case of death or unknown whereabouts of an employee?
Such amounts shall be:
(a)
paid to the nominated person; or
(b)
deposited with the prescribed authority if nomination is absent or payment is not possible.
When is the employer discharged of liability for such dues?
When the dues are paid to the nominee or deposited with the prescribed authority.
Who appoints authorities to decide claims under the Code?
The appropriate Government may appoint authorities not below the rank of a Gazetted Officer.
What powers does the authority have while deciding claims?
The authority may award compensation up to ten times the claim amount and shall endeavour to decide claims within three months.
What happens if an employer fails to pay the determined claim and compensation?
A recovery certificate shall be issued to the Collector or District Magistrate to recover the amount as arrears of land revenue.
Who can file a claim application?
A claim may be filed by:
(a)
the employee;
(b) a registered Trade Union; or
(c)
the Inspector cum Facilitator.
Can a single application cover multiple employees?
Yes, a single application may be filed for multiple employees of an establishment.
What is the limitation period for filing claims?
Claims may be filed within three years, with provision for condonation of delay on sufficient cause.
What powers do the authority and appellate authority have?
They have powers of a civil court for taking evidence, enforcing attendance, and compelling production of documents and are deemed civil courts for specified criminal procedure purposes.
What is the scope of enquiry under minimum wage claims?
There is no scope to examine equal pay for equal work. Such disputes must be resolved through adjudicatory mechanisms.
Does the prescribed authority act as an appellate authority in disciplinary proceedings?
No, it has no jurisdiction to sit in appeal over disciplinary proceedings.
When are disputes deemed industrial disputes under the Code?
Disputes relating to fixation or eligibility of bonus, or application of bonus provisions to public sector establishments, are deemed industrial disputes.
What presumption applies to audited balance sheets of corporations and companies?
Audited balance sheets and profit and loss accounts may be presumed accurate unless found otherwise.
Can clarifications be sought regarding audited accounts?
Yes, authorities may direct the employer to furnish clarifications to Trade Unions or employees.
How are accounts of non-corporate employers audited?
If audited accounts are produced, provisions applicable to corporations apply. If not audited, authorities may direct an audit or arrange one themselves.
Who bears the expenses of such audits?
The employer bears the audit expenses, recoverable as arrears if unpaid.
Who may file an appeal against an order under claims proceedings?
Any aggrieved person may file an appeal within ninety days, with provision for condonation of delay.
How is the appellate authority constituted and what is its role?
It shall be an officer of higher rank, hear parties, and endeavour to dispose of appeals within three months.
How are dues under appellate orders recovered?
Through recovery certificates issued by the authority.
What records must employers maintain?
Employers must maintain registers of employees, muster rolls, wages, and other prescribed details.
What notices and wage documents must employers provide?
Employers must display statutory notices and issue wage slips.
Are small employers exempt from record-keeping requirements?
Yes, employers employing not more than five persons for agriculture or domestic purposes are exempt, subject to producing proof of payment when demanded.
Who appoints Inspector cum Facilitators and where do they exercise jurisdiction?
The appropriate Government appoints them, with jurisdiction throughout the State or specified establishments.
Can inspections be conducted electronically?
Yes, inspection schemes may include web based inspections and electronic information gathering.
Can inspections be conducted through randomised selection?
Yes, the Government may confer such jurisdiction by notification.
What is the legal status of an Inspector cum Facilitator?
They are deemed public servants.
What functions does an Inspector cum Facilitator perform?
They may advise employers and workers and inspect establishments.
What powers do Inspector cum Facilitators have during inspections?
They may examine persons, seek information, search and seize records, report defects, and exercise other prescribed powers.
Are persons legally bound to cooperate with an Inspector-cum-Facilitator?
Yes, failure to cooperate attracts penal consequences.
In essence, the provisions relating to advisory boards, payment of dues, claims and audit and the Inspector-cum-Facilitator under the Code form an integrated compliance and dispute resolution architecture aimed at safeguarding workers’ rights and ensuring fair labour practices. The advisory boards institutionalise tripartite deliberations that influence wage policy and labour participation, robust mechanisms for payment and claims ensure that employees receive their dues without undue delay and the Inspector-cum-Facilitator performs a dual role of enforcement and facilitation. Together, these provisions reflect the Code’s commitment to balancing efficiency in industry with protection of worker entitlements thereby fostering equitable and transparent labour governance in a rapidly evolving economic landscape.
Muneeb Rashid Malik is an Advocate. He tweets @muneebmalikrash.
