Karnataka Minimum Wages for the year 2021-22

We wish to inform you that the Karnataka Minimum Wages for the year 2021-22 has been revised by Rs. 428.40/-. The Current DA is Rs. 1723.20/- for S&E sector & Rs. 2631.60/- for Security sector respectively. The same is required to be implemented w.e.f. 1^st April 2021.

The class of employment & designation wise calculations under the Shops & Commercial Establishments Act & Security agency act are enclosed for your ready reference.

Kindly ensure that the revised minimum wages are paid to the contract vendors, so that they may pay it in turn to their sub vendors & to the deployed contract staffs. The contract vendors are required to revise their salary structure as per the Minimum Wages published for the year 2021-22 which is mandatory.

If any of your regular employees are paid as per the Minimum Wages at your organisation, then kindly revise the salary for those coming under the ambit of Minimum Wages w.e.f April 2021.

Adding to the circular notes, please consider the below points while fixing the Minimum wages for the year 2021-22 :

1. In case of daily wages earners, the minimum daily rates of wages should be worked out by dividing the monthly rates by 26 days and providing wages for 4 weekly holidays.
2. Women employees shall be paid the same rates of wages as men, where the nature of work is same.
3. Wherever the prevailing rates of wages are higher, the higher rates of wages shall be continued to be paid.
4. In case of piece work, daily total earning of those workers for 8 hours of work shall not be less than daily rates of wages fixed for that category of employees. In computing the above rates a day’s work is deemed to comprise of 8 working hours. If the workers are employed for less than 8 hrs, then less than 4 hours to be paid 4 hour wages, above 4 hours to be paid 8 hour wages.
5. In case if any category of workers are not mentioned in this notification, shall be paid based on the type of their work.
6. Workers employed on the day of weekly holiday and on the National and Festival Holidays shall be paid double the normal rate of wages (Gross wages).
7. For work beyond normal working hours, the employees shall be paid two times the normal rates of wages. (As per S&E Act Sec 16, Defn of Wages = Total Full time earnings)
8. Any other benefit which is already been provided shall be continued to be provided to them.
9. Karnataka Minimum Act, 1948 Section 4 gives the power to the appropriate government in the fixation of the minimum wages and the state of Karnataka has considered only the Basic & DA components as minimum wages.
10. Every contract employee who has completed 240 days in a year shall be paid 2% of their basic wages as service weightage as per KN CLRA Service conditions notified in the year 2013.
11. Under Section 6 of the Payment of Wages Act, 1936, Employer shall ensure that Wages to the employees are directly credited to the respective bank accounts.
12. Wherever the Establishment has engaged employees under The Contract Labour (Abolition & Regulation) Act, 1970, Employer shall ensure that implementation Minimum Wages under this Act and applicability of all other applicable Acts to such employees.

Latest Supreme Court PF Judgment Impact :

Further to the earlier shared SC ruling dated 28^th Feb 2019 it is unlikely to impact those with Basic Salary above Rs. 15000 per month. The establishments, contractors paying PF on less than 15000/- & not considering other allowances will have to reconsider the PF wages by including the other allowances component upto Rs. 15000/-.

On Roll Employees comparison chart :

MINIMUM WAGES	Manager Category			Asst Manager Category			Employee Category (Formerly EE category was considered under Computer Operator category, as per the introduction of Class of employment Skilled category to be applied as per their description of role)
	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22	01st Apr 2019 – 31st Mar 20	01st Apr 2020 – 31st Mar 21	01st Apr 2021 – 31st Mar 22
BASIC WAGES	16423	16423	16423	15423.4	15423.4	15423.4	14021.27	14021.27	14021.27
DEARNESS ALLOWANCE	877.2	1294.8	1723.2	877.2	1294.8	1723.2	877.2	1294.8	1723.2
Min Wages Total	17300.2	17717.8	18146.2	16300.6	16718.2	17146.6	14898.47	15316.07	15744.47

Off Roll Employees comparison chart :

MINIMUM WAGES	Manager Category			Formerly Group I – now under Highly Skilled workers			Formerly Group II – now under Skilled worker Category
	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22
BASIC WAGES	16423	16423	16423	15423.4	15423.4	15423.4	14021.27	14021.27	14021.27
DEARNESS ALLOWANCE	877.2	1294.8	1723.2	877.2	1294.8	1723.2	877.2	1294.8	1723.2
Min Wages Total	17300.2	17717.8	18146.2	16300.6	16718.2	17146.6	14898.47	15316.07	15744.47
MINIMUM WAGES	Formerly Group III – now Semi Skilled Worker Category			Formerly Group IV – now unskilled worker Category
	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22	01st Apr 2019- 31st Mar 20	01st Apr 2020- 31st Mar 21	01st Apr 2021- 31st Mar 22
BASIC WAGES	12746.61	12746.61	12746.61	11587.83	11587.83	11587.83
DEARNESS ALLOWANCE	877.2	1294.8	1723.2	877.2	1294.8	1723.2
Min Wages Total	13623.81	14041.41	14469.81	12465.03	12882.63	13311.03

Area of impact for Minimum Wages under New Labour Codes :

The procedure for determination of minimum wages by the appropriate Government is in line with the provisions of the Minimum Wages Act. However, the New Wage Code introduces the concept of a floor wage, which is to be determined by the Central Government after taking into account the minimum living standards of workers in a manner to be prescribed, which may be different for different geographical areas. The appropriate Government can, under no circumstance, fix a minimum wage rate which is lower than the floor rate determined by the Central Government. However, if the existing minimum wages fixed by the appropriate Government is higher than the floor wage, they cannot reduce the minimum wages.

Once the Central government publishes the Floor Minimum wages, more clarity will be received on this context. Until such time, the KN State Government issued Minimum wages for the year 2021-22 to be adhered.

Wage Code Sec 2(y) impact is still not clear whether this provision will apply to all wages or will it be applied above a certain wage threshold, etc. Hence until precision is received from the government, the existing process to be continued.