Wage policy and wage regulation machinery

Wage policy –definition

Wage policy are the principles acting as guidelines for determining a wage structure. In other words “wage policy” refers to the government action undertaken to regulate the level or structure of wage or both ,for the purpose of achieving specific objectives of social and economic policy.

In India it is built around certain cardinal principles :1.Equal pay for equal work2.Living wages for all workers so that they led a decent life.3.Payment of wage on due date without unauthorized

deductions.4.Resolving wages related issues by collective bargaining .5.To compensate for the rise in cost of living.

5.Ensuring a fair,equitable wage policy for various employees without significant wage difference .

6.The capacity to pay .ECONOMIC OBJECTIVES OF WAGE POLICY• Full employment and optimum allocation of all resources.• The highest degree of economic stability consistent with an

optimum rate of economic progress.• Maximum income security for all section of community.SOCIAL OBJECTIVES OF ECONOMIC POLICY• Elimination of exceptionally low wage.• The establishment of fair labor standards .• Protection from inflation • The incentive for workers to improve performance.

LIMITATIONS OF WAGE POLICY• Socio-economic set up of our society.• Disparity in distributing wages.• Lack of unity among unions.• Price rise almost beyond government regulatory capacity.

WAGE REGULATION MACHINERY

NEED OF WAGE REGULATION : • To protect workers from exploitation.• For the development of the economy• To ensure a minimum wage for the workers .COMPOSITION OF WAGE REGULATION BOARDS Wage regulation boards basically composed of three parties.

It is a tripartite body representing management, workers and government. Equal no of representatives selected by the government and they sort out wages related issues. Government plays a role of mediator.

FUNCTIONS OF WAGE REGULATION BOARDS • Determine which categories of employees

(manual,clerical,supervisory etc) are to be brought within the scope of wage fixation.

• Work out a wage structure based on the principles of fair wages formulated by the committee on fair wages.

• Suggest a system of payment by results• Work out the principles that should govern bonus to workers

in industries .

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