Why in News?

• Expert Committee Submits its Report on Determining Methodology for Fixing National Minimum Wage.

Highlights:

• There have been several developments since the norms for the fixation of the minimum wages were recommended by the 15th ILC in 1957 and subsequently strengthened by the judgement of the Supreme Court in the judgement of Workmen v Reptakos Brett & Co. case in 1992. The Ministry of Labour and Employment had constituted an expert committee on January 2017, under the Chairmanship Dr. Anoop Satpathy, Fellow, V. V.Giri National Labour Institute (VVGNLI) to review and recommend methodology for fixation of National Minimum Wage (NMW).
• The Expert Committee had the mandate to examine and review the norms and methodology for fixation of national minimum wage; and determine the base level National minimum wage/wages through an evidence-based approach.

About the report:

• The report using scientific approach has updated the methodological framework of
  fixation of minimum wages based on the overall guidelines of the ILC 1957 and the Supreme Court Judgment of Workmen v Reptakos Brett & Co. in 1992.
• The report has undertaken a rigorous and meticulous analysis and has generated a large amount of evidence relating to changes in the demographic structure, consumption pattern and nutritional intakes, the composition of food baskets and the relative importance of non-food consumption items to address the realities in the Indian context by using official data made available by the National Sample Survey Office (NSSO).

Recommended Nutritional intake:

• Using the nutritional requirement norms as recommended by the Indian Council of Medical Research (ICMR) for Indian population, the report has recommended a balanced diet approach which is culturally palatable for fixation of national minimum wage.
• Accordingly, it has proposed that food items amounting to the level of ± 10 per cent of 2,400 calories, along with proteins ≥ 50 gm and fats ≥ 30 gm per day per person to constitute a national level balanced food basket.

Committee recommendations:

• On the basis of the aforesaid approach, the report has recommended to fix the need based national minimum wage for India at INR 375 per day (or INR 9,750 per month) as of July 2018, irrespective of sectors, skills, occupations and rural-urban locations for a family comprising of 3.6 consumption unit.
• It has also recommended to introduce an additional house rent allowance (city compensatory allowance), averaging up to INR 55 per day i.e., INR 1,430 per month for urban workers over and above the NMW.
• Apart from proposing the level of a single national minimum wage at an all-India level,
  the report has also estimated and recommended different national minimum wages for different geographical regions of the country to suit the local realities and as per socio- economic and labour market contexts.
• For the purpose of estimating national minimum wages at regional levels it has grouped the states into five regions based on a composite index.