Karnataka Daily Wage Employees Welfare Act - Law Insider

By K. Manoggnya Reddy

Published on : September 13, 2021 at 18:57 IST


What is the Minimum Wages Act?

The Indian Constitution defines a living wage as the level of income that a worker needs to provide for a basic standard of living. It is the level of income that ensures a worker’s good health, dignity, and comfort.

To keep in mind that an industry’s capacity to pay should also be considered a ‘fair wage’ has been defined by constitution, that it is to be noted that the level of wage that an individual receives is not just keeping pace with the workers needs and keeping in mind steady employment levels but also the industry’s capacity to pay.

Due to the unjust attention that it has received, it is now exploited by many businesses to which they underpay their employees and the public opinion stated that governments should annually change the wage range, just like countries around the world do.

In 1948, the Central Advisory Council established a Tripartite Committee for the implementation of Fair Wage. This committee conceptualized ‘minimum wage’, which provides for a variety of basic needs and provides for a level of comfort.

The Minimum Wages Act was introduced in India in 1948. It gives the Central and State Governments the authority to fix wages. This act is not legally binding but is statutory and states that payments below the wage range were considered to be forced labour.

Minimum wages are often set by wage boards to ensure that employees are compensated enough to meet the basic needs of a family of four.

Due to the varying costs of living and the capacity of various regions and occupations to pay, the hourly wage rates vary depending on the state and sector of the job market. This structure has become overly complex and is not uniform.

The highest and lowest minimum wage rates were – as per 2012 – Rs 322/day and Rs 38/day in Andaman and Nicobar and Tripura respectively. In Mumbai, the minimum wage for a safai karmachari was Rs 348/day which was rarely paid.

What is Karnataka Daily Wage Employees Welfare Act, 2012?

In the year of 2011, The Karnataka High Court passed an interim order on MGNREGA’s wage rates to be aligned with the Minimum Wage rates of the state.

The Karnataka Government then passed a Karnataka Daily Wage Employees Welfare Act, 2012 which received its assent from the Governor on 14th February, 2013.

The act was passed to provide for the welfare of daily wage employees for over ten years in various establishments of the State. It is the right of the daily wage employees of establishments to receive the minimum security of tenure, improved wage, and certain social security benefits upon termination from their long service.

In Section 2 of the Act it defines what a daily wage employee, the government, the establishment and local bodies mean.

In Section 3 of the Act it gives the provisions for the Continuation of the daily wage employees.

Daily wage employees in establishments which are notified by the government under this Act shall continue to be paid on daily wage basis up to the age of sixty years, whichever is earlier. If a daily wage employee is not able to prove that he has the prescribed qualifications for the post, he shall not be continued without his prior approval.

One year from the date of this Act, the State Government shall notify the names of all employees who are eligible daily wage employees of any establishments. The Karnataka Civil Services Rules, 1978 and any other rules governing the operations of the Civil Services in the State were deemed not applicable to this Act.

And then Section 4 discusses the Pay, leave and terminal benefits of a daily wage employee in service.

The pay of a daily wage employee is the minimum of the timescale of pay that he is required to continue in service. He shall be paid with regard to the provisions of the Government’s regulations.

A daily wage employee shall be entitled to all of the Holidays, Casual Leave, and Earned Leaves That are provided for in the law. It may be increased at any interval by the Government. The daily wage employee may be entitled to a terminal benefit or ex-gratia on his or her cessation of employment after attaining the age of sixty years.

A daily wage employee may be entitled to an increase in his pay at any interval of time that may be determined by the Government.

The daily wage employee may be entitled to a terminal benefit or ex-gratia on his or her death upon reaching the age of sixty years.

Section 5 to 11 discuss various subjects such as Conduct and discipline, termination for misconduct by the employee, who can Appeal, protection of the government bodies of action taken in good faith, that civil courts shall not have jurisdiction, power to remove difficulty and power to make rules respectively.

The provisions of the Conduct Rules, 1966 are applicable to the daily wages of employees of Karnataka Civil Services. He shall be liable for any disciplinary action under the said rules if he is found guilty. No order to terminate the employment of a daily wage employee shall be made without holding a summary enquiry. Any person who is aggrieved by the order of an officer or authority may appeal to the Government or the head of the organization in case of daily wage employee.

No suit, prosecution or other proceedings shall be brought against the officers of the Government or local bodies for any act or omission in good faith. No Civil Court was given the jurisdiction to entertain any claim or proceeding in respect of the provisions of the Act. If there is any difficulty in implementing the provisions of this Act, the Government may make special provisions to remove the difficulty.

Recent Judgements

The Karnataka High Court has ruled that daily wage workers, who come under the Karnataka Daily Wage Employees’ Welfare Act 2012, are entitled to 100% dearness allowance. The daily wage workers who work for the government are also entitled to a leave of 30 days, a bench of Justice M Nagaprasanna ruled. The court observed that

            The soul of the Act being the grant of a better wage and social security on cessation of long public service to a daily wage employee, cannot be reduced to a rope of sand,”.

The High Court on Tuesday said that the Government’s decision to curtail the earned leave and other benefits of daily wage employees was like a tail wagging the dog instead than the other way around.

The Dearness Allowance is the amount of money that employees receive when the inflation rate is calculated. The other perks, or earned leave, are also available to employees. Earned leave is a type of leave that can be earned during the previous years of employment. It can be availed afterwards within a certain period.

The Court then proceeded to state

“It is trite that administrative instructions in the form of official memoranda or circular or Government Order cannot run counter to the Act or in effect control the Act. This, if permitted, would amount to the  tail wagging the dog and not the dog wagging the tail,”.

The petition was filed by various daily wage employees’ associations. They said that the allowance was reduced to 75% in 2014 and then increased to 90% in another order in January 2020. Previously, in 2017, a circular had denied earned leave to the employees. It also said that leave encashment which was allowed in the past had to be recovered.

The High Court has rejected the orders of the previous judgements as they were against the principles of the Act, and the recovery clause was also deemed to be unsustainable. The High Court has in conclusion ruled that daily wage employees are entitled to the same ex-gratia as other workers.

How was Ex-gratia restored?

The judge said that those who are under the Act may approach the authorities concerned for representation in a month.

The judge said that the provisions of the Act apply to allottees of the order dated April 7, 2000.

The judge said that under the provisions of the Act, the people coming under the Act may approach the authorities concerned in a month’s time. The authorities shall implement the orders within six months.

The associations challenged the rules 4(3) and 4(4) of the Karnataka daily wage employees welfare Rules, 2013. They pointed out that these rules go against sections 2(a) and 4(2) of the Act.

The government has informed the court that the orders and circulars issued regarding the implementation of the recommendations of the report have been withdrawn.


The Minimum Wages Act, 1948, provides for fixing the minimum wages in certain sectors. It is implemented through various administrative and monitoring mechanisms. The Act applies to the schedule for which minimum wages are fixed or revised. Every employer shall pay the wages for the hours worked and the wages for overtime. This Act provides for the fixed hours of work and the wages for overtime. The DA is fixed based on the Consumer Price Index for the previous calendar year. The minimum wages are fixed in Karnataka according to the recommendations of the State Level Minimum wages Advisory Board.


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