Minimum Wages & Floor Wage

The Code on Wages introduced a brand-new concept — a national Floor Wage below which no minimum wage anywhere in India may fall.

Minimum Wages — Sec. 5–8

flowchart TD
    MW["Minimum Wages — Ss.5-8 Code on Wages 2019"]:::root
    MW --> FIX["Fixing — S.5<br/>Appropriate Government fixes minimum rates"]:::step
    MW --> REV["Revision — S.8<br/>at least once every 5 years"]:::step
    MW --> COMP["Components — basic rate + cost-of-living<br/>allowance, or an all-inclusive rate"]:::step
    MW --> FLOOR["Floor Wage — S.9<br/>national minimum set by the Centre;<br/>no State may fix a minimum below it"]:::key

    classDef root fill:#FFF8DC,stroke:#000,stroke-width:1px,color:#000;
    classDef step fill:#E6F3FF,stroke:#1E3A8A,color:#000;
    classDef key fill:#FFD700,stroke:#8B6914,color:#000;
    linkStyle default stroke:#888,stroke-width:1px;

The Code on Wages extends minimum-wage protection to all employments — not just the “scheduled employments” of the old Minimum Wages Act 1948 — making it universal.

Floor Wage vs Minimum Wage

	Floor Wage	Minimum Wage
Set by	Central Government	Appropriate Government (Centre/State)
Section	S.9	S.5
Purpose	A national floor — no State can go below	Sector / region-specific minimum
Relation	Every minimum wage must be ≥ floor wage	May be higher than the floor wage

The floor wage may be set differently for different geographical areas, but it operates as an absolute national baseline: a State’s minimum wage can be higher than the floor, never lower.

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