Minimum Wages in India: State-Wise and Central Rates
The minimum wage amounts in India are legally specified amounts that would ensure workers do not receive lower pay. The minimum wage amounts are not standard for the country. Rather, they vary based on employment, level of skills, among other factors that demonstrate the uniqueness of the Indian economy.
This webpage offers a concise explanation regarding the working of minimum wages in India and serves as a portal to the state-wise rates of minimum wages.
How minimum wages are set in India
Minimum wages in India came into effect through the Minimum Wages Act, 1948. The act provides for the fixation and revision of rates for a particular occupation. The Indian wage structure is a decentralized wage structure. This means that there is no minimum wage applicable across the country. Hence, to summarize:
- There is no single minimum wage for the entire country
- Wages differ by state or union territory
- Rates depend on occupation, industry, and skill category
This structure allows wages to align more closely with local living costs and labour conditions.
Central vs State minimum wages
Minimum wage rates in India are determined by both the Central Government as well as the State Governments, based on the kind of employment.
These are applicable to employment under the central authority, such as railways, mines, oil fields, and specified national establishments.
The State Governments determine the wages in respect of employment under their jurisdiction. These constitute the main part of India’s notifications of minimum wages. The figures are extremely disparate over regions. The detailed figures are provided in each State-wise Minimum Wages, listed under the links provided.
Skill categories and wage structure
Most minimum wage notifications classify workers into skill levels, such as:
- Unskilled
- Semi-skilled
- Skilled
- Highly skilled
In many states, minimum wages also include a Variable Dearness Allowance (VDA), which adjusts pay based on inflation. Learn more under Minimum Wage Components in India.
Who is covered under minimum wage laws?
The minimum wage rates are generally applicable to workers under regular employment and to contract, daily wage, and unorganized sector workers. The applicability can vary according to states and sectors.
Enforcement and compliance
The employers must pay workers at least the minimum wage as notified. Failure to comply may result in fines. The labor department at both the central and state administrative levels is responsible for enforcing such guidelines. Further information is provided in Minimum Wage Compliance and Enforcement in India.
Why do minimum wages differ across states?
India’s cost of living, urbanisation levels, and employment patterns vary significantly. State-specific wages allow flexibility while maintaining a legal wage floor for workers.
FAQs
1. What is the minimum wage in India?
The minimum wage in India is the lowest threshold base that an employer is allowed to pay an employee. The minimum wage is determined by the various state governments and differs for certain employer types (as specified by the central government).
2. Is there one national minimum wage in India?
No. India does not have a single national minimum wage anymore, as rates differ across states and union territories.
3. Who fixes minimum wages in India?
Minimum wages are decided, in accordance with the type of employment, by the Central Government or the State Governments.
4. Does the minimum wage vary depending on the state?
The minimum wage levels are reported by each state, according to its local economy and cost of living.
5. Does the minimum wage depend on the level of skill?
Yes, most notifications regard workers as unskilled, semi-skilled, skilled, or highly skilled workers.
6. How frequently do minimum wages or salaries get revised?
Salaries are reviewed from time to time-by law, at least once in every five years.
7. Are contract and daily wage workers covered?
Usually, contract employees and daily wage laborers/earners are protected by minimum wage legislation, so they are covered.
8. Is minimum wage inclusive or exclusive of allowances?
Many states have a basic minimum wage with a Variable Dearness Allowance, which takes into consideration the rate of inflation.
9. Can employers pay less than the minimum wage?
Paying less than the notified minimum wage is illegal and could be attracted by penalties due to the strict legislation involved.
10. Where can I find the latest minimum wage rates?
Please click on the state or union territories on this page to get current rates.
