Minimum Wages: Definition, Arguments, and Objectives

Minimum wages can stand set by statute, the decision of a competent authority, a wage board, a wage council, or by industrial or labor courts or tribunals. Minimum wages can also exist set by giving the force of law to provisions of collective agreements. It commonly accepts that workers should give at least minimum wages to enable them to lead a minimum standard of living. Then a question arises – What is a minimum wage? It is, however, difficult to define “minimum wage’’. However, it may define as a wage that is just sufficient for the worker to keep his body and soul together.

Introduction to Minimum Wages: Meaning, Definition, Arguments, and Objectives.

First, do you know “What does mean the Wages?” Now learn, that the Minimum wage has stood defined as the minimum amount of remuneration; that an employer requires to pay wage earners for the work performed during a given period; which cannot reduce by collective agreement or an individual contract. The purpose of minimum wages is to protect workers against unduly low pay. They help ensure a just and equitable share of the fruits of progress to all; and, a minimum living wage for all who stand employed and in need of such protection.

Definition of Minimum Wages:

They can also be one element of a policy to overcome poverty and reduce inequality, including those between men and women. Minimum wage systems should define and design in a way to supplement and reinforce other social and employment policies, including collective bargaining; which uses to set terms of employment and working conditions.

The committee on fair wages defines the minimum wage as an irreducible (minimum) amount considered necessary for the sustenance of the worker and his family; and, the preservation of his efficiency at work. The Fair Wages Committee considered that “a minimum wage must provide not merely for the bare subsistence of life but the preservation of efficiency of the worker. For this purpose, the minimum wage must also provide for some measure of education, medical requirements and amenities”.

As well as:

Such a minimum wage may fix by an agreement between the employer and the workers but it is generally determined by legislation. The workers generally demand that the minimum wage should base on the standard of living but the employers argue; that it should base on the productivity of labor and the capacity of the industry to pay.

Minimum wages defines as,

“The minimum amount of remuneration that an employer requires to pay wage earners for the work performed during a given period; which cannot reduce by collective agreement or an individual contract.”

But it should note that while fixing the minimum wage, the worker’s family should also take into account. The wage should sufficient not only to maintain himself but also his family in a reasonable standard of living. Then a question arises – What is the size of the worker’s family? It now generally accepts that a worker’s family consists of five-person – the worker and his wife and three children.

The minimum wage must fix in such a way that it is sufficient to provide a reasonable standard of living to the worker and his family. Thus, while fixing the minimum wage, three principles should take into account – the living wage, the fair wage, and the capacity of the industry to pay. While fixing the minimum wage, the capacity of the industry should take into account. If a particular industry is not able to pay the minimum wages to its workers; then it has no right to exist in the business.

Background:

A minimum wage was introduced by the Labour government on 1 April 1999 at a rate of £3.60 per hour for workers over 21 years of age, and £3 per hour for 18–21-year-olds; this was raised by 10p per hour in 2000. At the time, the Low Pay Unit estimated that 2 million people (8.3 percent of the workforce) would gain from this, the main beneficiaries being women, especially in social care (e.g. child care) and cleaning jobs. Other areas where there is traditionally low pay, and which would benefit, were young people (200 000); hospitality (295 000); and retail (300 000).

Arguments for introducing a Minimum wage and also Against:

The following are;

For introducing:

For Against:

Objectives of Minimum wages:

The objectives of minimum wages are as follows:

• To prevent the sweating of workers in organizing or unorganized industries.
• Prevent the exploitation of workers and enable them to obtain wages according to their productive capacity, and.
• Maintain industrial peace.

In organized industries where the trade unions are powerful; the employers generally yield to the demands of the workers for fixing a proper wage. But in the unorganized industries where the trade unions are not found, government interference and legislation become essential to ensure that the laborers do not exploit and pay at least the minimum wage.