How will the wage definition under the Labour Codes alter fixed vs variable pay design?
AB The Labour Codes introduce, for the first time, a uniform statutory definition of “wages” that applies across multiple central labour enactments, replacing the disparate definitions previously found in numerous statutes such as the Payment of Wages Act, 1936, the Minimum Wages Act, 1948 and the Payment of Bonus Act, 1965.
The core definition of “wages” is identical in all four Codes. Taking the Code on Wages (section 2(y)) as the base, “wages” are defined to mean all remuneration (whether by way of salaries, allowances or otherwise) expressed in monetary terms which are payable to a person in respect of his employment or of work done in such employment, and specifically include:
- basic pay;
- dearness allowance; and
- retaining allowance, if any.
Certain items are expressly excluded from wages, such as statutory bonus, value of house accommodation, employer’s...
