Delhi Government to Restart Minimum Wage Talks

The Aam Aadmi Party (AAP) government’s plan to hike minimum monthly wages by 50 per cent to around Rs. 14,000 for workers in Delhi has been scrapped in its current form.

Following a diktat from Lieutenant-Governor Najeeb Jung, the Delhi government has been compelled to start the entire exercise of computing the revised minimum wages afresh.

“The minimum wages advisory committee has been reconstituted and notified now. It will meet on September 23 to start fresh discussions to fix minimum wages,” said a top State Labour Ministry official. 

Industry chambers had raised apprehensions about the formula, the official said. “The calculations will be revisited now as industries too had raised a few objections,” he added.

The previous 13-member advisory committee was termed ‘illegal’ by the LG as it was formed without his approval. Mr. Jung had earlier this month sent back the Delhi government’s proposal to substantially hike the minimum wage asking it to restart the entire process. “There is no change in the new committee but it has now been approved by the LG,” the official added.

Delhi Labour Minister Gopal Rai had said earlier this month that although it had sought ex-facto approval to the formation of the committee from the LG, he had declined the request which will lead to “delay” in revising the minimum wages.

The Delhi government had proposed increasing minimum wages for 

1. Unskilled workers from Rs 9,568 to Rs 14,052 a month. 
2. Semi-skilled be increased from Rs 10,582 to Rs 15,471 and
3. Skilled workers  from Rs 11,622 to Rs 17,033.

Opposing the move, top industrial chambers had told the LG that the minimum wage level has been over-estimated as the Delhi government’s calculations were based on flawed calorific value.

Each State can fix its own minimum wage level for industries based on various parameters spending estimates for a working class family on 2,700 calories of food per person, 72 yards of clothes, minimum housing rent and education and light and fuel, as prescribed by the Indian Labour Conference in 1957. However, industry chambers had argued that Delhi government took into account 3,447 calories while calculating the wage limit, instead of the minimum requirement of 2,700 calories. The expenditure on food, which constitutes roughly around 65 per cent of the entire wage component, was thereby overestimated hiking the minimum wage, the industry body claimed.