Unit 3

Wage policy
National Wage Board
Objective of wage board
(a) To work out wage structure based on the principles of fair wages as formulated
by the Committee on Fair Wages.

(b) To work out a system of payment by results.

(c) To evolve a wage structure based on the requirements of social justice.

(d) To evolve a wage structure based on the need for adjusting wage differentials in
a manner to provide incentives to workers for advancing their skill.

Formation
The Central Government shall, as and when considered necessary, constitute Wage
Boards, which shall consists of

a) Three persons representing employers in relation to Newspaper Establishments

b) Three persons representing working journalists for the Wage Board constituted
under Section 9 and persons representing non - journalist newspaper employees for
the Wage Board constitute under Section 13C of the Act.

c) Four independent persons, one of whom shall be person who is, or has been, a
judge of High Court or the Supreme Court, and who shall be appointed by the
Government as the Chairman thereof

Functions of wage board

a. Determine which categories of employees (manual, clerical supervisory, etc.) are
to brought within the scope of wage fixation.

b. Work out a wage structure based on the principles of fair wages formulated by the
committee on fair wages.

c. Suggest a system of payment by results.

d. Work out the principles that should govern bonus to workers in industries.

In addition to these common items, some wage boards may be asked to deal with the
question of :

· Bonus (like that of the wage boards for cement, sugar and jute industries)

· Gratuity (like that of the wage boards for iron ore mining, limestone and
dolomite mining industries)

· The second wage board on cotton textile industry; demands for payments
other than wages (wage boards for jute and iron and steel industry)

· Hours of work (rubber plantation industry)

· Interim relief (wage boards for jute industry and post and dock workers).

Some wage boards (Wage boards for sugar, jute, iron ore, rubber, tea and coffee
plantations, limestone and dolomite mining industries) have been required to take
into account the 'special features of the industry'.

Thus, wage boards have had to deal with a large number of subjects. Of these, the
fixation of wage - scales on an industry - wise basis constitutes the biggest of all the
issues before them.

In evolving a wage structure, the board takes into account:

(a) the needs of the industry in a developing economy including the need for
maintaining and promoting exports:

(b) the requirements of social justice, which ensures that the workman who
produces the goods has a fair deal, is paid sufficiently well to be able at least to
sustain himself and his family in a reasonable degree of comfort, and that he is not
exploited;

(c) the need for adjusting wage differentials (which is in relation to occupational
differentials; inter-firm differentials; regional or inter-area differentials; inter-
industry differentials and differentials based on sex) in such a manner as to provide
incentives to workers for improving their skills.

For the determination of fair wages, the board has to take into consideration such
factors as the degree of skill required for his work, the fatigue involved, the training
and experience of the worker, the responsibility under-taken, the mental and
physical requirements for work, the disagreeableness or otherwise of the work and
the hazards involved in it. The board is required to make due allowances for a fair
return on capital, remuneration to management and fair allocation to reserve and
depreciation.

Working of wage board

1. The first step is to prepare a comprehensive questionnaires designed to collect
information on the prevailing wage rates and skill differentials, means of assessing
an industry's paying capacity and workloads, prospects for industry in the
immediate future, and regional variations in the prices of widely consumed
consumer goods. The questionnaire is sent out to labour unions, employers
associations, interested individuals, academic organisations and government
agencies.

2. The second step is to give a public hearing at which leaders of labour unions and
employers associations, not represented on the board, as well as others interested in
the industry in question, are given a verbal or oral bearing on issues dealing with
wages, working conditions and other items.

3. The third step is to convene secret sessions at which members of the board make
proposals and counter - proposals regarding the items covered under the terms of
reference.