Government hikes unskilled labourers’ minimum wage to Rs350 per day

The pay hike will benefit more than 10 million workers in sectors under the central government, but labour unions will go ahead with strike on 2 September


Finance minister Arun Jaitley and power minister Piyush Goyal at the inter-ministerial panel meeting on labour on Tuesday. Photo: PTI
Finance minister Arun Jaitley and power minister Piyush Goyal at the inter-ministerial panel meeting on labour on Tuesday. Photo: PTI

New Delhi: The Union government on Tuesday increased the minimum wage of non-agricultural, unskilled workers in the central sphere from Rs.246 to Rs.350 per day and announced the release of pending bonuses of central government employees in an attempt to get trade unions to call off the nationwide labour strike on 2 September.

The wage hike move will benefit more than 10 million workers in sectors such as mines, construction and sanitation. But the labour unions remain unconvinced and said they would go on strike as scheduled, to protest against labour reforms, disinvestment in profit-making public sector undertakings and contractualization of workforce, and demand a monthly minimum wage of at least Rs.15,000.

The decision to hike minimum wage does not mandatorily apply to all such workers across the country. Labour issues are part of the concurrent list of the Constitution, allowing both the Union and state governments to make rules on it. The Union government has the power to declare a national minimum wage floor, discussions for which have been on for the past couple of years.

An inter-ministerial panel on labour led by finance minister Arun Jaitley termed the decisions historic. “This is a huge jump in minimum wages,” Jaitley said while appealing to trade unions to not go on strike. The other members of the panel are labour minister Bandaru Dattatreya, power minister Piyush Goyal, petroleum minister Dharmendra Pradhan and minister of state in the Prime Minister’s Office Jitendra Singh.

“We are for tripartite consultations on labour issues,” Jaitley said, adding the government has conceded to the demands of the unions related to issues such as minimum pay and payment of bonus.

Central government employees will get two years’ bonus. This will cost the government around Rs.2,000 crore per year.

The Union government last year amended the Payment of Bonus Act, allowing employees earning Rs.21,000 per month—up from Rs.10,000—to get bonus.

“The bonus entitlement for 2014-15 and 2015-16 will be released on the revised norms for central government employees. After this, bonus will be covered under the 7th Pay Commission,” Jaitley said, adding the Union government is with the unions on the bonus Act implementation and will oppose any move by industries to not comply with it.

The government clarified it will not make Accredited Social Health Activist (Asha), Anganwadi and mid-day-meal workers permanent. While Asha workers are foot soldiers of the National Rural Health Mission, Anganwadi workers are key to the implementation of the Integrated Child Development Scheme (ICDS). “The nature of such jobs is voluntary and that’s very clear,” Jaitley said.

Dattatreya said his ministry is working on a plan to provide social security to such workers and reiterated the Union government led by Prime Minister Narendra Modi is pro-people and pro-worker and will not do any thing that will hurt their interests.

“The NDA (National Democratic Alliance) government is pro-poor and working for the betterment of workers. When we are taking so many pro-people decisions, the trade unions should not go on strike,” he said.

But unions are in no mood to relent. All central trade unions, except the Bharatiya Janata Party-affiliated Bharatiya Mazdoor Sangh (BMS), will go on strike as planned, D.L. Sachdeva, national secretary of the All India Trade Union Congress, said.

A.K. Padmanabhan, president of the Centre of Indian Trade Unions, said in the past year, the group of ministers did not even meet the central unions. “They last met us 367 days back on 28 August 2015 and a few days back they met only BMS and did not bother to call any other trade union. They are trying to create a division among unions to avert the strike. We will go ahead and this time it will be bigger than the previous editions of nationwide strikes,” he said, asking, “Where is the consultation on labour reforms, where is the mandatory minimum wage of Rs.15,000 per month?”

When asked why the group of ministers is only talking to BMS and not others, Dattatreya said his government “does not differentiate between unions. I myself had met all unions last month.”

The minister said to protect contract workers, his ministry will write to states to register such workers and staffing agencies in the states. Registration of contract workers and staffing agencies is mandatory under law.

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