Code on Wages (Rajasthan) Rules, 2021: Severe Assault on Rights of Under Paid Workers of Rajasthan

Rajasthan ranks very low amongst the states when level of minimum wages for workers legally notified is taken into account. The prevailing minimum wage rates in Rajasthan are far less than several other states in the country. The prevailing ‘market’ rate of manual daily wage-earning worker in few districts of Rajasthan in non-agricultural season especially in rural and semi-rural areas hovers just above or around the notified wage rates. It’s only in few districts of north and eastern Rajasthan bordering NCR region of Delhi that manual daily wage labourers are paid at Rs 400-500/day in rural areas. As per RBI study average wage rate in rural Rajasthan in 2019-20 was Rs 297.60/day. Moreover, the state had the tag of being part of BIMARU states which tells a lot about social -economic conditions that prevails in the State.  


Despite the Congress and not the BJP being in power in Rajasthan, the Government of Rajasthan has in effect adopted the Central Code on Wages, betraying the workers of Rajasthan. The rules under the Code on Wages were notified in the state in July, 2021 during Covid distress making mockery of the consultation process. Moreover, the Govt of Rajasthan has been unwilling to take workers representative and trade unions in confidence while taking the process forward. It is important to remember that the present Ashok Gehlot headed Congress Govt has not undone several anti-workers amendments in labour laws done during the previous Vasundhara Raje regime.  As we will see in this article, the most troubling thing about the Rajasthan rules for Code on Wages is that it doesn’t have anything to address the very low sustenance level of the workers of Rajasthan. 


Manner of calculating the minimum rate of wages


Rule 3 under the Rajasthan rules on wage code provides for the manner of calculations of minimum wages, and provides for the following criteria:


  1. Number of consumption units: The Rules provide for the standard working-class family which includes a spouse and two children apart from the earning worker; an equivalent of three adult consumption units. This is not representative of realistic consumption units. It is necessary to incorporate an additional criterion in light of the Maintenance and Welfare of Parents and Senior Citizens Act, 2007 which places a mandatory and statutory obligation on a person to maintain his parents. Failure to comply with this obligation would have penal consequences. Hence, it would be necessary to include 2 additional consumption units in the calculation of minimum wages. Thus, a total of 6 consumption units must be taken into consideration.


  1. Food: The Rules provide for a net intake of 2700 calories per day per consumption unit based on outdated methodology. There has been a great shift in understanding the nutrition needs of a person. The cost on procuring fruit, vegetables, legumes (e.g. lentils and beans), nuts and whole grains (e.g. unprocessed maize, millet, oats, wheat and brown rice etc for a balanced diet should be included. 


  1. Clothing: The Rule proposes that 66 meters cloth per year be taken per standard working class family. This would be extremely insufficient. It is necessary that there is a proper mix of personal clothing, home textile requirements, footwear, socks and detergents including stitching charges.


  1. Housing and Shelter: The Rule proposes that rent expenditure is to constitute 10 per cent of food and clothing expenditure. This is wholly unrealisitc. In reality housing rents account for almost 30-50% of the total wage / salary. This proposed rule is contrary to even the judgment of the Supreme Court in the Reptakos Brett and Co. Ltd. As per the order, in respect of housing, the rent corresponding to the minimum area provided for under Government's Industrial Housing Scheme should be taken into consideration in fixing the minimum wage. At the very minimum this component should be at least 30% of food and clothing expenditure. 


  1. Fuel, Electricity and other miscellaneous items of expenditure is provided to constitute 20 percent of minimum wage. The cost of cooking gas, vehicle fuels and electricity has seen a sharp rise in the past few years, and the same has not been taken into account.


  1. Expenditure for children education, medical requirement, recreation and expenditure on contingencies: It is provided to constitute 25 percent of minimum wage. With increase in privatization in both education and health, fixing all 4 constituents at merely 25% of the minimum wage would be highly inadequate and out of touch with reality. 


  1. Need to include additional components: It is necessary to include additional components including purchase of electronic good, including mobile and computers without which education is impossible and transportation costs. This is only indicative and other component of wages would also need to be included. 


  1. Minimum Wages to be calculated monthly basis, not daily: Minimum Wages are required to be calculated on a monthly basis, and not only daily as provided herein.


10. Time Interval for Revision of Dearness Allowance: Rule 5 provides that the revision of dearness allowance shall be made twice  a year i.e. on 1st April and 1st October on the basis of price index prepared by the Labour Bureau, Shimla. It can be conceded that when it comes to revision of dearness allowance Rajasthan rules are better than central rules of Code on Wages. 


11. Number of Hours of Work which Shall Constitute a Normal Working Day- The proposed Rule 6 provides that the normal working day shall be comprised of eight hours of work and one or more intervals of rest which in total shall not exceed one hour. The proposed Rule which fixes the hours of work in a day do not specify a limit on the number of working hours per week. The Rajasthan Minimum Wages Rules, 1959 under Rule 24 A, that the present Rules subsume, had prescribed a maximum of 48 hours per week. This leaves it open to establishments to alter weekly rest days in such a manner as to put workers through intensive hours of labour, in keeping with the daily limit, but in excess of 48 hours. This is in clear violation of ILO Convention C001 – Hours of Work (Industry) Convention, 1919, ratified by India, which fixed the maximum weekly work hours for industrial establishments at 48 hours. Rule 6 (2) provides for spread over for not more than twelve hours on any day. This is in contravention of Section 56 of the Factories Act. It also does away with Rule 24 of Rajasthan Minimum Wages Rules, 1959 which mandates that spread over shall not be for more than ten and a half hours a day unless especially provided in writing by Inspector with reasons to extend it to 12 hours.


Inspector-cum-facilitator and the Change of the Role of the Inspector:


Rule 47 of Rajasthan rules on Code on Wages provides that an inspection scheme shall be formulated by the Labour Commissioner with the approval of the State Government, which shall provide for “structural facts” and a number for each Inspector-cum-Facilitator and establishment. The change of the role of inspectors to “inspector-cum-facilitator’s”, results in making redundant the effective role of the inspector which is absolutely essential for the enforcement of various laws. It makes inspection based on the scheme of web-based inspection schedule, which would come in the way of surprise inspections, permissible under the present laws. 


The Rule is in flagrant violation of the Labour Inspection Convention, 1947 (No. 81) (C081) that has been ratified by India. The Convention provides that each Member shall maintain a system of labour inspection in industrial workplaces and provides the most basic norms for such a system. 


Compounding of Offences: Rule 44 provides for the manner of imposition of fine and the compounding of offences before a Gazetted Officer. Compounding of offences must not be permitted, and the same is further worsened by the fact that such compounding is permitted before a gazetted officer. 


Payment of Wage: Under the guise of timely Payment of Wages, the draft rules of state provides that where the employees are employed in an establishment through contractor, then, the company or firm or association or any other person who is the proprietor of the establishment shall pay to the contractor the amount payable to it,  before the date of payment of wages so that payment of wages to the employees shall be made positively in accordance with the provisions of Section 17. Hence, instead of ensuring payment of wages by the principal employer to the worker directly, the Draft Rules provides for “timely payment of wages” to the contractor, thereby ignoring the worker. 


The above analysis of Code on Wages (Rajasthan) Rules, 2021 clearly brings out that the rules are similar in anti-worker intent as central code on wages.  The subject of Labour comes under Concurrent list which gave the right to State Govt to legislate on labour laws to the extent it doesn’t contradict Central law. The State Govt of Rajasthan failed to exercise this constitutional space and succumb to pressure of Central Govt and more importantly Capitalist class which seeks that State should provide for ‘ease of doing business’ to attract ‘Investment’ at cost of workers. It is now up to the workers and their unions in the state to rise to the occasion to resist this anti-worker rules and code on wages.