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Minimum wage of Rs. 10,000 for all private sector employees: Labour Ministry
View(s):Legislation to set a minimum wage for all private sector employees will soon be presented in Parliament, the Labour Ministry said.
The draft of the Bill will set the minimum monthly wage of any private sector employee at Rs.10,000, regardless of whether the employee falls under categories named under the Shop and Office Act or the Wages Board Act. The Bill which is similar to the Budgetary Relief Act of 2005, has already been sent to Attorney General’s Department for approval.
According to Labour and Labour Relations Ministry Secretary Herath Yapa, this will benefit more than 1.5 million private sector employees in the country.
“This is the first time such a minimum wage has been introduced across the board. Trades in neither the Wages Board nor the categories in the Shop and Office Act have a stipulated minimum wage. However now employees will have to be paid a minimum wage of Rs.10,000. Contributions to EPF, ETF and gratuity payments should be calculated on this wage once the Bill is passed” he said.
Accordingly the minimum wage for daily paid workers will be Rs. 400, and piece rate payment is also set to increase by 10% – 15%, he said. He said that this will also help Labour Department officials in monitoring EPF, ETF payments. “The lowest EPF amount has to be Rs. 2000. If it is paid only for a lower amount now we can check. When calculations are done in labour dispute settlements, there is now a minimum wage standard to take into consideration”, he explained.
The Ministry will also bring in legislation to increase the salaries of all private sector employees by Rs. 1,500 from the month of May, and another Rs. 1,000 in January 2016, as proposed in the 2015 Budget. “This will come as a legal requirement not a request, as many companies did not pay when the Government made a request,” Mr. Yapa said adding that this is not an increment but an increase in the salary.
If any company has increased employee salaries in January, the company has the option of deducting the amount from the Rs. 1,500 and increasing the balance amount from the month of May.