WPM

TISCO is today one of the most efficient steel producer in the world where, there has
neither been any labour strike since 1928 , nor there is a case of assault to anybody and
theft. The concept of working together in TISCO was conceived in 1956 and was
implemented since 1958. The core of the process is based on the recognision of co-
determined decision-making wherever the interest of the worker is concerned. There are
56 joint departmental councils with rotating presentship, some of them relate to welfare,
production, safety, health , education and civil life etc.

WOMEN WORKERS IN NIGHT SHIFTS

With a view to ensuring optimal utilization of the installed capacity, promotion of export
and generation of employment opportunities for women, Government had decided to
ratify Protocol of 1990 to the ILO Night Work (Women) Convention (revised), 1948 to
provide flexibility in the matter of employment of women during night and related
amendment to the Factories Act, 1948.

The occupier of the factory shall be responsible for providing adequate safeguards as
regards to occupational safety and health, equal opportunities, adequate protection to
their dignity, honour and safety and their transportation from factory premises to nearest
point of their residence. .

DELAY IN REPAYMENT OF PF IN MUMBAI

The reasons for the delay in payment of Provident Fund to Employees in Mumbai are:
not getting claim forms countersigned by the employer or authorised person; non-
Readability due to correction in the Bank's Savings Bank Account No. and Bank's name
and address; and not affixing the Revenue Stamp and signature thereon to the effect of
advance receipt as required in the claim form.

The Union Government has issued guidelines through provisions contained in Para 72(7)
of the Employees' Provident fund Scheme, 1952 and Para 17 A of the Employees'
Pension Scheme, 1995. The guidelines provide that the claims complete in all respects
submitted along with the requisite documents shall be settled and benefit amount paid to
the beneficiaries within 30 days from the date of its receipt by the Commissioner.

As a step to ensure prompt settlement of claims, the staff members of Employees'

Provident Fund Organisation have been sensitised with proper instructions and the Front
Office functioning has been strengthened. The employer and the members are also
educated through Seminars and other fora about the specific requirements in the
schemes..

EFFECTS OF DISINVESTMENT ON LABOUR

A tripartite team comprising of a representative each from the Workers and Employers'
Organisation as well as from the Ministry of Disinvestment and the Ministry of Labour,
was constituted to assess the impact of disinvestment on Labour in BALCO and Modern
Foods (India) Ltd. The team has so far visited BALCO on 13-14th February, 2003.

JUDICIAL ENQUIRY COMMISSION REPORT ON BAGDIGI COLLIERY

ACCIDENT

LOK SABHA

The Court of Inquiry has observed that the workings of the Bagdigi Colliery No. 7 seam
punctured the waterlogged Jairampur Colliery in the same seam. Survey map prepared
after the accident indicated that the working of Bagdigi Colliery had undergone a
variation to the tune of about 35 degrees in directions and thus the workings had
proceeded in a totally different direction from the originally projected plan. To avoid
recurrence of this type of accident in belowground mines in future, the Court of Inquiry
has made following recommendations:

i. dewatering of old workings;

ii. application of latest geophysical methods for
probing the barriers/partings;
iii. change of managerial pattern at the colliery level;
iv. greater authority to the internal safety organization;
v. conducting of periodical check survey;
vi. improvement of surveying organization at mine and
Directorate General of Mines Safety;
vii. increasing the frequency of general inspection by
directorate General of Mines Safety officers by improving
the existing manpower structure;
viii. greater constructive role of trade unions.

The Agent, Manager, Safety Officer and Assistant Manager of Bagdigi colliery and the
Inspecting Officers of the directorate General of Mines Safety (DGMS) under whose
jurisdiction the mine fell have been held responsible by the Court of Inquiry.

The report submitted by the Court of Inquiry has been accepted by the Government and it
has been published in the Gazette of India. The comments of the Ministry of Coal and
directorate General of Mines Safety (DGMS) on the recommendations made in the report
have also been called for.

THE IMPLEMENTATION OF THE PROJECT 'REINVENT THE

EMPLOYEES PROVIDENT FUND'

The Employees' Provident Fund Organization has taken up the task of modernization
through the Project "Re-inventing EPF India". In view of the magnitude of the task of
mapping business processes, the Project schedule has been revised and the scheduled
tasks have been taken up for implementation in a phased manner.

GOVERNMENT IS COMMITED TO THE PROCESS OF CONSULTATIONS

AND DISCUSSIONS ON THE SENSITIVE ISSUE OF LABOUR REFORMS -
DR. SAHIB SINGH

UNORGANIZED SECTOR WORKERS' BILL 2003 AND A BILL ON WORKERS

PARTICIPATION IN MANAGEMENT WILL BE INTRODUCED IN THE CURRENT
SESSION OF PARLIAMENT

Union Labour Minister, Dr. Sahib Singh said that the Government is committed to the
process of consultations and discussions on the sensitive issue of labour reforms. Labour
Minister was inaugurating the two-day meeting of tripartite social partners on the report
of the second National Commission on Labour at V.V. Giri National Labour Institute at
NOIDA today. He further said that I have personally discussed the recommendations of
the Commission with all the Trade Unions, Employers' representatives and other eminent
personalities. He said as per the suggestion of the stakeholders the meeting is divided into
four technical sessions focussed on Comprehensive Social Security; Skill Development
And Training; Industrial Relations; and Social Protection For Unorganised Sector
Workers. The Minister hoped that the deliberations should serve the interests of the
workers and help change in the mindset of the Trade Unions, Employer representatives
and other eminent personalities to evolve a conducive environment for growth of
organized sector and industry. He said that interest of the workers of unorganised sector
are very paramount before the Government for which he is bringing Unorganised Sector
Workers Bill 2003 in the current session of the Parliament. He also informed that a Bill
on workers participation in management would also be introduced in the current session
of the Parliament.

Dr. Sahib Singh underlined the fact that skill development and training plays a major role
in this era of economic liberalization and globalization. A follow-up action has also been
taken by Directorate General Employment and Training (DGET) on some of the
recommendations of the second Labour Commission. He also informed that he has
already written to the Finance Minister for providing tax benefits and concessions in the
field of vocational and apprentice training. New ITIs are being opened up as a result of
the special drive launched by DGET, which has got enthusiastic response from various
States.

The Labour Minister pointed out that it would need strenuous efforts to bring the workers
of unorganized workers in the social security scheme. The involvement NGOs, self-help
groups and cooperation from private institutions would be required to make it a success.
He, therefore, appealed to workers organisation, employers and other eminent persons to
combine their efforts with the Government to help generate a conducive atmosphere by
successfully evolving and implementing labour reforms.
The Labour Ministry has taken several steps to implement the recommendations of the
second Labour commission. The Union Labour Minister addressed letter to the Chief
Ministers of all States on 13.11.2002 advising them to initiate appropriate action to
rationalize the labour laws falling within their purview. The Labour Secretary also wrote
a similar letter on 15.11.2002 to Chief Secretaries of all States. In order to crystallize the
view of the Government, the present Tripartite Committee Meeting has been convened to
deliberate on certain crucial recommendations, which are of direct relevance to labour,
industry and economy.

CELL FOR UPLIFTMENT OF WORKING WOMEN

A separate cell for women labour is functioning in the Ministry to pay special attention to
the problems of women labour. The Cell is responsible for coordinating efforts in respect
of Women labour within the policy framework on women, implementation of the Equal
Remuneration Act, collection, compilation and dissemination of information on various
aspects of the female labour force in various economic sectors and follow up action on
the Supreme court Judgement in the matter of prevention of sexual harassment of women
at their work place and periodical reviews of the initiatives taken in the matter in
consultation with related agencies.

Special efforts have been made to improve upon the working conditions of female
workers through the implementation of the following initiatives:

• The Cell is administering a Grants-in-aid Scheme for the

welfare of women labour. This Scheme is administered through
voluntary organizations by giving grant-in-aid to them for
providing awareness generation amongst women workers.

• Monitoring the implementation of the ‘Equal Remuneration

Act, 1976’ which aims at ensuring payment of equal remuneration
to men and women for the same work or work of a similar nature
without any discrimination and for prevention of discrimination
against women in recruitment as well as in conditions of service,
such as promotions, training, transfers, etc.

• As a follow up action on the judgement of the Hon’ble

Supreme court of India, in the case of writ petition No. 666-70 of
1992 filed by Vishaka & Ors. Vs State of Rajasthan & Ors. laying
down certain guidelines for the prevention of sexual harassment of
women employees in their work places.

FACTORIES ACT TO BE AMENDED TO ALLOW NIGHT SHIFT FOR WOMEN

WORKERS

The Government has decided to amend Section 66 of the Factories Act, 1948 to allow
employment of women workers between 7.00 pm and 6.00 am. Stating this in a written
reply in Rajya Sabha, the Minister for Labour and Employment, Shri K. Chandrasekhar
Rao said that this has been done on demand of women’s organisations and in tune with
the present economic globalization. He said this flexibility would be available to all
manufacturing units including the apparel sector. Shri Rao said that three meetings were
held with the representatives of the employers and the trade unions before taking the
decisions. He said that the proposed Bill will empower the State Governments for
allowing the necessary flexibility in employment of women during night shift in
factories.

In another written reply the Minister said that the amendment would inter-alia provide
that the employer has to ensure occupational safety and adequate protection to the women
workers. He said the State Government or any person authorised by it would be allowing
employment of women during night only after consulting the workers or their
representative organisations and concerned employers or their representatives. He said
the State Governments may also frame their own rules for allowing such permissions

SOCIAL SECURITY PROVISIONS TO THE COUNTRY’S WORKFORCE

Approximately 8 per cent of the country’s total workforce of around forty crores are
covered by Social Security provisions like Old-age Pension, Family Pension, lump sum
benefit at the time of death, medical benefits, disability benefits. These workers are
mostly in the organised sector.

Further, a large number of workers in the unorganised sector are eligible to get Social
Security benefits like those available under Workmen’s Compensation Act, Maternity
Benefit Act and Payment of Gratuity Act. A Social Security Group Insurance Scheme for
identified groups is being operated through Life Insurance corporation. Some State
Governments have also introduced schemes which provide some social security covers
for the workers in the unorganised sector.

The number of workers in the unorganised sector being huge and widely dispersed, the
extension of a comprehensive social security cover to such workers is a gigantic task and
would be a time consuming effort requiring massive resources. The main objective for
both employees Provident fund Organisation and ESI Corporation is to increase the
coverage of identifiable groups.

The Government is in the process of gradually extending the scheme to cover new centres
and simultaneously taking steps for creating of requisite infrastructure for providing
medical care to a larger number of insured persons and their families. There have been a
number of new developments in the ESIS during the past five years. Each year, it is
extended to new areas to cover additional employees.

ALL INDIA CONSUMER PRICE INDEX NUMBER FOR INDUSTRIAL WORKERS

REMAINS STATIONARY
 The All India Consumer Price Index Number for Industrial Workers (CPI-IW)
(base 2001-100) remained stationary during January 2007 to stand at 127 (one hundred
and twenty seven) points.

The Rise/Fall in index varied from centre to centre. The index during January
2007 recorded the highest increase of 4 points in Sholapur centre. It increased by 3
points in Rajkot centre, by 2 points each in 11 centres and 1 point in 24 centres.

The index decreased by 4 points in Labac-Silchar centre. It decreased by 3 points

in Giridih, Raniganj and Mongher-Jamalpur centres and 1 point in 12 centres, while in
the remaining 25 centres the index remained stationary.

The increase of 4 points in Sholapur centre was mainly on account of the increase
in the prices of Wheat, Jowar, Grinding Charges, Groundnut Oil, Goat Meat, Dairy Milk,
Onion, garlic, Tea (Readymade), Electricity Charges etc. while the decrease of 4 points in
Labac-Silcher centre was the outcome of decrease in the prices of Rice, Fish Fresh,
Vegetable & Fruit Items etc.

The index in respect of six main centres for January 2007 stood at the following level:-

1. Ahemdabad 126 4. Delhi 124

2. Bangalore 133 5. Kolkata 125

3. Chennai 122 6. Mumbai 131

STEPS TO UPGRADE SKILLS OF WORKER

Lok Sabha
A proposal to set up ‘Skill Development Fund’ initiated by the Government for
augmentation of training infrastructure facilities in the country could not be finalized as it
was not encouraged by the stake holders.

However, following steps have been taken to upgrade the skills of workers in various
parts of the country to make them globally competitive:

i. 500 Government ITIs are being upgraded as Centres of Excellence;

ii. A scheme namely "Establishment of new ITIs in the north Eastern States, Sikkim,
and J&K’ is being implemented;
iii. A scheme of testing and certification of skills of persons engaged in the informal
sector has been started.
iv. A new scheme of skill Development Initiative (SDI) based on modular
employable skills in Public Private Partnership mode to train, test and certify the
skills of persons has been taken up for implementation from the next financial
year.
 v. Contribution of industry is being taken in developing course curriculum,
overseeing quality of training, assessment of competencies, and providing on-the-
job apprenticeship training.

This information was given by the Minister of State (Independent Charge) for Labour &
Employment, Shri Oscar Fernandes in a written reply in Lok Sabha.

Rajya Sabha

2281 workers were killed in mishaps while at work in factories registered under
the Factories Act, 1948 during the last three years. They included 96 woman. Statewise
details are as follows:

State Women Men

Andhra Pradesh 37 342
Bihar 0 26
Chandigarh 0 1
Delhi 1 36
Goa 0 36
Gujarat 8 477
Haryana 0 186
Karnataka 3 143
Kerala 1 40
Maharashtra 2 207
Orissa 1 86*
Punjab 0 95**
Rajasthan 10 163
Tamil Nadu 33 155
West Bengal 0 192

* In respect of years 2005 & 2006 for which figures are available

**In respect of years 2004 & 2005 for which figures are available

The State-wise information on compensation paid in the case of deaths and

employment injuries, as available in respect of State Governments, is as follows:

S.No. State Amount paid (In Rupees)

2003-04 2004-05 2005-06
1. Andhra Pradesh 29661913 29798582 32586883
2. Assam & Meghalaya 1457299 1442235 1414202
3. Bihar 15554710 15155730 15760497
4. Chandigarh 1547591 1612578 2102090
5. Chattishgarh 1957915 1756764 1792135
6. Delhi 16552821 16425457 16785825
7. Goa 1905918 2014659 2646791
8. Gujarat 37699244 36211225 36204362
9. Haryana 17854230 17817524 17534798
10. Himachal Pradesh 1235692 1037869 1184286
11. Jammu & Kashmir 541851 529412 682921
12. Jharkhand 2518178 2937043 3097392
13. Karnataka 23964460 23143233 24138637
14. Kerala 19032970 18640728 18690190
15. Madhya Pradesh 14278770 13512081 15367278
16. Maharashtra 65114078 61486429 61901426
17. Orissa 8044176 8288823 8128113
18. Pondicherry 826555 951242 989824
19. Punjab 22956270 22104795 23341316
20. Rajasthan 25452857 24773379 24537236
21. Tamil Nadu 39228636 38174026 39431359
22. Uttar Pradesh 47597919 48695967 50526594
23. Uttaranchal 1583696 1392422 1644910
24. West Bengal 35670160 32665530 32317638

This information was given by the Minister of State (Independent Charge) for
Labour & Employment, Shri Oscar Fernandes in a written reply in Lok Sabha.

INCREASE IN INSPECTION TO CHECK VIOLATION OF MINIMUM WAGES

LAW
Lok Sabha

The number of cases related to check violation of Minimum Wages Law in terms of
inspections, irregularities/rectified have shown significant improvement especially in the
State Sphere during the last 3 years. The number of inspections has increased
significantly from 1.81 lakhs during 2003-04 to 4.49 lakh and further to 5.08 lakh during
2004-05 and 2005-06 respectively as far as the 17 states/UTs from where the comparative
figures are available. This is indicative of more emphasis on inspections in the State
Sphere. There is relative decline in irregularities detected as well as rectified, which
indicates better compliance of Minimum Wages Act, 1948. This is the result of relentless
efforts made by Central as well as State Governments. The Government is still pursuing
effective implementation of Minimum Wages Act, 1948 through discussion, writing
letters, personal interaction and visits to all the States/UTs including the North-Eastern
States.

The comparative table of the common States (who have submitted their
enforcement reports) for last three years is as below:

Year Sphere No. of Inspections made Irregularities

Detected Rectified
2003-04 Central 18380 241023 175816
State 162449 149965 174085
 Total 180829 390988 349901
2004-05 Central 16956 179551 211092
State 431680 178247 137619
Total 448636 357798 348711
2005-06 Central 12392 133826 140307
State 495889 207032 160954
Total 508281 340858 301261

WORKING OF ESI HOSPITALS IN THE COUNTRY SATISFACTORY

Rajya Sabha

The condition of ESI Hospitals and their working in the country is generally satisfactory.
The ESI Corporation has formulated various schemes to improve the condition of the ESI
hospitals as detailed below:

123 ESI Hospitals are being run by the State Governments as per Section 58 of the ESI
Act, 1948; 17 hospitals as Model Hospitals, 03 hospitals in Delhi and 01 hospital in
Chandigarh are directly run by the ESI Corporation.

ESI Corporation has increased the ceiling for providing medical care from Rs. 900/- to
Rs. 1000/- per Insured Person family unit per annum w.e.f. 01.04.2007 to facilitate State
Governments with more funds to improve medical services in ESI Hospitals. Besides this
an additional incentive of Rs. 50/- per insured person per family units will be given to the
State Government on fulfilling stipulated terms and conditions for improvement of
medical scheme. Modernization & upgradation of hospitals is done by providing modern
equipments for diagnostic and clinical services.

ESI Corporation has allotted a budget of Rs. 1251.82 crores during 2007-08 to provide
medical services.

RATE OF INTEREST ON EPF

Rajya Sabha

The Government has notified the rate of interest on Employees Provident fund for the
year 2005-06 @ 8.5 per cent.

The interest rate of 8.5 per cent has been declared after taking into consideration the
earnings of the Employees Provident fund for 2005-06 and certain other internal
resources.

References/representations have been received from Labour Unions and their

organizations, protesting against reduction of interest rate.
In reply to another question the Minister said that the amount of arrears outstanding as on
September 30, 2005 was Rs. 2,429.97 crore. The actions taken against the defaulters
include prosecution under Section 406/409 of IPC, attachment of movable/immovable
property and arrest of defaulters.

PRIVATE SECTOR ACCOUNTED FOR MAXIMUM CLOSURES DURING 2002

Maximum number of closures, retrenchments and lay offs in industries in the country
took place in the private sector during 2002. An analysis of the statistics in this regard has
revealed that out of 213 closures, 211 were in private sector while two were in the central
sphere. As many as 10,025 workers were affected by these closures of whom 9,991
workers belonged to the private sector and 32 workers to the central sphere. The largest
number of 93 closures were reported from Uttar Pradesh. Maximum closures took place
in industries manufacturing basic metals.

98 retrenchments were also reported during 2002 of which 80 per cent were in private
sector. The remaining were in public and cooperative sectors. 35 per cent of
retrenchments were reportedly caused by lack of demand for products and the remaining
retrenchments were due to financial stringency, break down of machinery and other
factors. The retrenchments affected 2,279 workers in the private sector and 1,596 workers
in the central sector. The maximum number of 40 retrenchments were in Gujarat.

More than 27.84 lakh man-days were lost due to 249 cases of lay offs affecting 30,030
workers. 80 per cent lay off cases took place in the private sector, 16 per cent in public
sector and the remaining 4 per cent in the cooperative sector. The most prominent cause
for lays offs was financial stringency. Maximum number of lay offs took place in
industries manufacturing textiles resulting in laying off of 18,685 workers.

STRATEGY TO ELIMINATE CHILD LABOUR

Rajya Sabha
As per the provisional figures of Census 2001, the number of working children in the age
group of 5-14 years is 12.59 million. Under the strategy adopted in the 10th Plan for
elimination of child labour the number of districts covered under the National Child
Labour Project has been increased from 100 to 250 districts so that child labourers could
be rehabilitated in the child labour endemic areas. The children who have been identified
to be child labourers and who are between the ages of 5-8 would be put directly into the
formal-education-system.

The children who have been identified as child labourers as per the census survey and
who are between the ages of 9-14 would be put through a special school mechanism
before mainstreaming them into the formal schooling system.

It is expected that through these three steps all children between the ages of 5-14 who are
found to be workig in the hazardous occupations and processes would be mainstreamed
into the formal primary schooling system by the end of the plan.

The State Government monitors the functioning of the child labour projects and reviews
their performance at the state level through the State Monitoring Committee. At the
national level, a Central Monitoring Committee under the Chairmanship of Union
Secretary (Labour) monitors the overall functioning of the scheme. In addition, the
projects are regularly inspected by the officers of the state Government. Officers of the
Central Government also visit the districts to ensure proper implementation of the
scheme.
6TH PAY COMMISSION
The Government of India have been considering for some time past the changes that have
taken place in the structure of emoluments of Government employees over the years.
Conditions have also changed in several respects since the last Pay Commission made its
report in 1997. Accordingly, it has been decided to appoint the Sixth Central Pay
Commission comprising of the following:

1 Chairman Mr. Justice B.N.Srikrishna

2 Member Prof. Ravindra Dholakia
3 Member Mr. J.S.Mathur
4 Member-Secretary Smt. Sushama Nath

Terms of Reference
A. To examine the principles. The date of effect thereof that should govern the
structure of pay, allowances and other facilities/benefits whether in cash or in
kind to the following categories of employees:-
1. Central government employees – industrial and non-industrial.
2. Personnel belonging to the All India Services.
3. Personnel belonging to the Armed Forces.
4. Personnel to the Union Territories.
5. Officers and employees of the Indian Audit and Accounts Department;
and
6. Officers and employees of the regulatory bodies set up under Acts of
Parliament.
B. To transform the Central Government Organisations into modern, professional
and citizen-friendly entities that are dedicated to the service of the people.
C. To work out a comprehensive pay package for the categories of Central
Government employees mentioned at (A) above that is suitably linked to
promoting efficiency, productivity and economy through rationalization of
structures, organizations, systems and processes within the government, with a
view leveraging economy, accountability, responsibility, transparency,
assimilation of technology and discipline.
D. To harmonize the functioning of the Central Government Organisations with the
demands of the emerging global economic scenario. This would also take in
account, among other relevant factors, the totality of benefits available to the
employees, need of rationalization and simplification, thereof, the prevailing pay
structure and retirement benefits available under the Central Public Sector
Undertakings, the economic conditions in the country, the need to observe fiscal
prudence in the management of the economy, the resources of the Central
 Government and the demands thereon on account of economic and social
development, defence, national security and the global economic scenario, and the
impact upon the finances of the States if the recommendations are adopted by the
States.
E. To examine the principles which should govern the structure of pension, death-
cum-retirement gratuity, family pension and other terminal or recurring benefits
having financial implications to the present and former Central Government
employees appointed before January 1, 2004.
F. To make recommendations with respect to the general principles, financial
parameters and conditions which should govern payment of bonus and the
desirability and feasibility of introducing Productivity Linked Incentive Scheme
in place of the existing ad hoc bonus scheme in various Departments and to
recommend specific formulae for determining the productivity index and other
related parameters.
G. To examine desirability and the need to sanction any interim relief till the time the
recommendations of the Commission are made and accepted by the Government.

The Commission will devise its own procedure and may appoint such Advisers,
institutional consultants and experts, as it may consider necessary for any particular
purpose. It may call for such information and take such evidence, as it may consider
necessary. Ministries and Departments of the Government of India will furnish such
information and documents and other assistance as may be required by the Commission.
The Government of India trusts that State Governments, Service Association and others
concerned will extend to the Commission their fullest cooperation and assistance.
The Commission will have its headquarters in Delhi. The Commission will make its
recommendations within 18 months of the date of its constitution. It may consider, if
necessary, sending reports on any of the matters as and when the recommendations are
finalized.

Concepts on Wage Fixing : Post-Pay Commission Report

The Volume I of our representation had gone into great details regarding the concept of
wages. The issue of whether wages should be revised or not has already been settled. The
very fact that this Board found it necessary to provide an interim relief was acceptane of
the case for wage revision. The only question to be decided therefore is the quantum of
revision and its application.

After discussing in detail minimum and fair wages it had pointed out that none of these
concepts was static. As early as 1975 Justice Goswami in the Killick Nixon case (1975-
II-LLJ-p.53-SC) had observed that "luxuries of yesterday may become comforts of today,
necessities of tomorrow. Economic solutions must reckon the turn abouts in social urges,
because even the worm turns." Our memorandum had recalled the observation of the
tripartite committee on fair wages that "while lower limit of the fair wage must obviously
be the minimum wage, the upper limit is set by what may be called the capacity of the
industry to pay." We had also refuted the oft repeated claim of managements that as the
VDA was expected to neutralise the rise in cost of living, there was no need for wage
revision. The Supreme Court’s observation in the Balmer Lawrie case (1964 LLJ I 380)
itself clarifies this. Every wage fixing authority today goes beyond fair wage and works
towards a living wage, the latest being the Fifth Pay Commission.

The Board may kindly note that the basis of fixing wages in the past was largely a
consumer need which was considered at a bare minimum like the minimum nutritional
level, minimum clothing, housing etc. But today life is more complex and living
standards are not based on simple living. Nor can such simple living be prescribed only
for working class while the owners wallow in wealth. The producer of wealth being the
consumer also, if he does not have wages to buy something more than bare necessities the
whole economy would never progress. The science of economics has gone far beyond the
classical economists and a living wage has become a legitimate expectation of all people,
workmen or others. If there is no living wage, the economy is unlikely to be impelled by
a force strong enough to drive into a take off. Nobel Laureate Amartya Sen , according to
Prof. Deepak Bannerjee has emphasised that tobe able to hold one's head high is an
essential ingredient of life (Statesman, Oct 20, 98). Public action cannot stop at the level
where bare physcial survival is just possible." Justice Goswami in the case quoted earlier,
has given this judicial sanction by emphasising that "theremay be no inexorable rule tying
down economic existence to definitions of bygone days, if unsitable or irrelevant in the
context of times...the most dominant of these must always be social justice, for that is the
ideal which we resolved to achieve when we framed our Constitution." Going by these
judicial and authoritative observations this Hon'ble Board is called upon to do justice to
the demands of working journalists.

The change of life styles that impact the standard of living is evident from the fact that
colour TV has become an essential part of the living standard of all common people,
journalists and non journalists alike. For journalists it is even more important because it is
TV that gives hour to hour news developments. In a competitive market where no
journalist can afford to miss on latest developments in their natural context, colour TV is
essential. If he has such a set at home, he could come to know of an important event
happening at dead of night in its true setting and rush back to office to file a late night
story. Yet, in the estimation of the Cost of Living Index ( with 1982 as base) the CTV
does not come up as a cost element as CTV had not come into widespread use at that time
in this country. In 1990s , particularly after 1995, the journalist has to have certain
minimum electronic tools of his profession which also do not come into the orbit of the
CPI. A home computer with a recurring expense for its maintenance, ink cartridge etc,
increased power consumption, the mobile phone with its expensive air time charges, and
soon an Internet connection, would be the standard requirement. More specially after the
Prime Minsiter appointed a National Task Force on Information Technology and declared
Government’s intention to transfer all transactions on computer networks,no journalist
can function effectively without these tools of his work. These are also required for his
own upskilling as a contemporary journalist. The cost of training in use of computers is
also considerable and the employers do not meet any part of it except in a very narrow
area of writing a story or editing it on the computer. The Fifth Pay Comimission
discarded all other concepts of the past and introduced "decent salary" as the benchmark
for determining wages.

The question that newspaper managements often raise is that whether the working
journalists can demand decent salaries even if these are beyond the capacity of
managements to pay. One may add here that this question has been raised every time a
wage board had fixed a new set of scales. Quoting the employers’ represenatives in the
Shinde wage board, Justice Palekar had said that they had "vehemently opposed" the
moderate recommendations made by the majority. " It was alleged that if the
recommendations were implemented they would spell the doom of the newspaper
industry and several newspapers would have to be closed down causing large scale
unemployment." What happened in reality between 1967 and 1980? Justice Palekar
comments: " It is gratifying to note that in the nearly 13 years that have passed thereafter,
nobody came to grief in spite of the implementation of the(Shinde) award. On the
contrary, some of the these very newspapers which had been selectively chosen in para
33 of the dissent note for their financial inadequacy to meet the additional burden have
been very successful." Justice Palekar gave several instances of the very newspapers that
cried hoarse then but later could bear even further additional burden. (Palekar report para
8.7 and 8.8).

Much the same happened post-Palekar. And Justice Bachawat noted the same situation
had developed post-Palekar. Financial performance of a sample of 60 newspaper
establishments, selected on the basis of availability of data but representing a fair cross
section of the newspaper industry lends fresh support to the growth perspective. The
financial health of these sample newspaper establishments was studied with reference to
various parameters of performance based on averages of 1980-81 to 1982-83 and 1984-
85 to 1986-87. The analysis revealed that, while paid up capital of these newspaper
establishements increased from Rs 912..76 lakhs to Rs 1354.24 lakhs their net worth
grew from Rs 3439.59 lakhs to Rs 6952.67 lakhs showing a rise of 48.37 per cent and
102.14 per cent respectively.

Rise in gross block is another important indicator of growth. The sample newspaper
establishement period. Various profitability ratios too reveal an encouraging picture.
Gross revenue and gross profits of the sample newspaper establishments registered a
growth of 90.80 per cent and 199.68 per cent respectively during the period.

The growth of the newspaper industry after paying the Bachawat award, was even higher
than what had happened before it. We have shown earlier that the "boom times" of the
print media continued post-Bachawat despite the substantial increase in wage bill.(Please
refer to "Financil situation of the industry" in chapter 2).

When we submitted Volume 1 of our memorandum before the Hon’ble Board, the Fifth
Pay Commission had not submitted its report. Subsequent to that report we have sought
to reexamine whatever we had said in our first volume. And we are gratified to find that
there is a great deal of support for our stand in that report.
For instance, we are to some extent flattered by the Fifth Pay Commission accepting what
we have been urging that every employer has an obligation to pay decent wages to the
employee irrespective of the narrow concept of capacity to pay. Narrow in the sense that
when an employer looks at wages as a burden rather than as a development expenditure,
the perspective changes. It is said that Henry Ford I grasped the significance of a decent
wage when for the first time in AMERICAN ecnomic history, he offered a wage of five
dollars per hour to his auto workers. Had he been asked then whether he had the capacity
to pay he would have said no. But by taking the risk of paying what was considered not
possible, he induced a social revolution and ushered in the mass production era. His
capacity to pay increased enormously.

The Fifth Pay Commission takes up the theme of capacity to pay and points out that
despite Government’s financial constraints, "lack of resources cannot be cited as an
unalterable reason by denying the employees their due." The Commission has introduced
the concept of "decent salary" and says that by restricting certain expenditures,
"Government can very well afford to pay its employees a decent salary." This is
applicable not only to the Government as an employer but to all employers, more
particularly newsapaper employers whose papers are expected to take up social causes
and hold aloft social justice in their own interest of building up a loyal readership.

ENSURE HIGH LEVEL OF COMPLIANCE OF LABOUR LAWS; LABOUR

INSPECTORS MUST ACT AS FACILITATORS AND GUIDE, LABOUR
MINISTER URGES LABOUR COMMISSIONERS

The Minister of State (Independent Charge), Labour & Employment, Shri Oscar
Fernandes has urged the officers of the Chief Labour Commissioner’s (Central)
Organisations to ensure a high level of compliance of labour standards. Inaugurating the
Annual Conference of the Dy. Chief Labour Commissioners ( C ) and the Regional
Labour Commissioners ( C ) here this morning, Shri Fernandes said that the compliance
should be ensured not only through prosecution but through persuasion and education of
the employers. He said that the labour administration must adapt to the changes in view
of the present globalisation scenario to make itself effective and relief oriented. He said,
“Now the officers must play a pro-active role as the facilitator, the advisor and the guide
to employers, unions and workers so that there is a willing voluntary compliance of
provisions of the labour laws by employers and at the same time the workers are made
aware of their duties and responsibilities.” Shri Fernandes said that there is a need to set
high standards of professionalism in order to bring about a marked change in the work
culture. He urged the Conference to discuss the term ‘Inspector Raj’ and the tag attached
to it. The Labour Minister said that the CLC’s ( C ) Organisations has a greater
responsibility since 93 per cent of the country’s workforce is employed in the
unorganised sector. He appreciated the efforts of the organisation in undertaking special
crash programmes to ensure payment of minimum wages to the workers in this sector.
Shri Fernandes said that the cases must be disposed off as early as possible so that
workers are able to receive relief well in time. The Minister said that the conference is
taking place on the day the country is celebrating the 150 years of its first war of
independence and the workers expect something good from this conference.

In her key not address, the Secretary, Labour and Employment, Smt. Sudha Pillai said
that there is a need for introspection about the role of labour inspectors as it has come to
scrutiny and criticism the employers as well as some trade unions said that we need to
pose questions to ourselves as to whether inspections are being held honestly. Smt. Pillai
said that the purpose of the inspections should be to provide relief to workers and not
merely to harass the employer or the establishments. She said that the Ministry treats the
CLC( C ) Organisations as its eyes & ears as the inputs from it are helping in formulation
of policies. She complemented the work of the officers of this Organisations in
completing the Phase I and Phase II verification of trade union in a record time.

Earlier, the Chief Labour Commissioner ( C ), Shri S.K. Mukhopadhyay called for
increasing the rate of settlement of industrial disputes through conciliation. He said that
the success rate of settlement was around 30 per cent. Shri Mukhopadhyay said that
during last year 30,000 inspections were conducted, 12,000 prosecutions were launched
and 10,000 convictions secured. He said that recovery of minimum wages takes a lot of
time and called for having own recovery officers for speedy recovery of minimum wages.
He also said that the Labour Commissioners must avail more of IT facilities to facilitate
on-line redressal of grievances of employees and employers.

The two-day conference will critically analyse the performance of the CLCs (C )
organisations during the last one year. It will also discuss issues like selective
inspections, relief oriented inspections, role of inspectors as a facilitator rather than
labour administrator and also the issues of probity, transparency and accountability.

INCREASE IN SETTLEMENT OF INDUSTRIAL DISPUTES

THROUGH CONCILIATION
LABOUR MINISTER TO INAUGURATE LABOUR
COMMISSIONER’S CONFERENCE TOMORROW

There has been a steady improvement in the settlement of industrial disputes through
conciliation officers of the Central Industrial Regulations Machinery (CIRM) also known
as the Chief Labour Commissioners’ (Central) Organisation. Since 2000-01 the number
of settlements arrived at in conciliation proceedings has been going up. The number of
settlements was 764 in 2000-01 while it rose to 1506 in 2004-05. Some of the notable
achievements on industrial relations front during the recent past have been the long term
settlement in cement industry benefiting nearly 1.25 lakh workers and in Hindustan
Copper Limited benefiting 6000 workers. The success rate of averting the threatened
strikes through mediation by conciliation officers continues to be 97 to 98 per cent. A
number of proposed strikes have been averted in banking industry, major port trusts, oil
industry, mines, Government of India Security and Currency Press, Mints etc.
However, over the years there is a steady fall in the number of Industrial disputes referred
to CIRM. Consequently the number of disputes being seized in conciliation is also
showing a decline. There is also decline in the cases of threatened strikes. Similarly the
number of awards received for implementation is also on decline. There is also no
improvement in the number of awards implemented mainly due to stay orders from the
courts and non-availability of sanction under 197 Cr. PC from the employing Ministry.
However in the year 2005-06, 80 per cent settlements were fully implemented.

The officers of CLC( C ) organisation successfully completed Phase I and Phase II of

General Verification within record time of 3 years. They verified the membership of
18,168 trade unions affiliated to 13 Central Trade Unions (CTU) with claimed
membership of 42 million workers. The final phase of verification i.e., declaration of
provisional results and inviting objections from CTU Organisations is yet to be
undertaken due to status quo order given by the Kolkata High Court.

An All India Conference of Deputy Chief Labour Commissioners ( C ) and Regional

Labour Commissioners ( C ) is being held in the capital from Thursday (10th May 2007)
to critically analyse the performance of the CLC’s ( C ) Organisations during the last one
year. The two-day Conference being inaugurated by the Minister of State (Independent
Charge), Labour and Employment, Shri Oscar Fernandes will also deliberate on the ways
and means for improving settlement of industrial disputes.

CPI(IW) Base 2001=100 Monthly Index Letter - MARCH 2007

Index Number Base Year All India General Index

February 2007 March 2007

Consumer 2001=100 128 127

Price Index
Numbers for
Industrial
Workers -
CPI(IW)

Consumer 1986-87= 392 392

Price Index 100
Numbers
forAgricultur
al Labourers

Consumer 1986- 393 393

 Price Index 87=100
Numbers for
Rural
Labourers

CENTRE-WISE CPI(IW)
Consumer Price Index
Numbers for Industrial
Workers on base
2001=100
Sr. Feb., Sr. Feb., Mar.,
State Centre Mar., 2007 State Centre
No. 2007 No. 2007 2007
GODAVARIK
AP 1
HANI
130 130 MHR 44 MUMBAI 131 130

2 GUNTUR 125 125 45 NAGPUR 138 136

3 HYDERABAD 121 120 46 NASIK 128 130
VIJAYAWAD
4 123 124 47 PUNE 134 132
A
VISHAKHAP
5 124 124 48 SHOLAPUR 133 130
ATANAM
WARRANGA ANGUL-
6
L
129 128 ORI 49
TALCHER
124 124

DOOM
ASM 7 DOOMA- 119 119 50 ROURKELA 129 130
TINSUKIA
PONDICHER
8 GUWAHATI 119 118 PND 51
RY
128 127

LABAC-
9
SILCHAR
124 128 PUN 52 AMRITSAR 135 135

MARIANI-
10 123 123 53 JALANDHAR 128 128
JORHAT
RANGAPARA
11 120 120 54 LUDHIANA 133 132
- TEZPUR
MONGHYR-
BIH 12
JAMALPUR
128 130 RJN 55 AJMER 129 128

CHANDIGAR
CHD 13 130 129 56 BHILWARA 129 131
H
CHS 14 BHILAI 125 125 57 JAIPUR 131 132
DLH 15 DELHI 125 125 TN 58 CHENNAI 122 121
COIMBATO
GOA 16 GOA 127 127 59 126 125
RE
GUJ 17 AHMEDABAD 126 127 60 COONOOR 119 118
18 BHAVNAGAR 125 125 61 MADURAI 118 119
19 RAJKOT 123 124 62 SALEM 120 120
TIRUCHIRA
20 SURAT 124 122 63 122 121
PALLY
21 VADODARA 124 124 TRP 64 TRIPURA 116 117
HRY 22 FARIDABAD 126 127 UP 65 AGRA 132 133
YAMUNANA
23 131 131 66 GHAZIABAD 129 130
GAR
HIMACHAL
HP 24 124 125 67 KANPUR 130 129
PRADESH
J & K 25 SRINAGAR 123 125 68 LUCKNOW 126 126
JRK 26 BOKARO 125 125 69 VARANASI 128 128
27 GIRIDIH 140 141 WB 70 ASANSOL 132 133
JAMSHEDPU DARJEELIN
28 130 129 71 125 125
R G
29 JHARIA 132 133 72 DURGAPUR 126 127
30 KODARMA 133 136 73 HALDIA 120 121
RANCHI
31 129 129 74 HOWRAH 125 126
HATIA
KNT 32 BANGALORE 134 132 75 JALPAIGURI 120 120
33 BELGAUM 128 128 76 KOLKATA 126 128
HUBLI
34 130 129 77 RANIGANJ 126 126
DHARWAR
35 MERCARRA 121 120 78 SILIGURI 128 132
ALL INDIA
36 MYSORE 130 128
INDEX
128 127

KRL 37 ERNAKULAM 129 127

MUNDAKAYA
38 129 127
M
39 QUILON 128 126
MP 40 BHOPAL 132 132
CHHINDWAR
41 133 134
A
42 INDORE 127 127
43 JABALPUR 133 132

3. Website : http://www.labourbureau.gov.in

CENTRE-WISE CPI(AL/RL)
CONSUMER PRICE INDEX NUMBERS(GENERAL) FOR AGRICULTURAL
AND RURAL LABOURERS (BASE 1986-87=100)

Rural
Agricultural Agricultural Rural
Labourers
Sr.No. State Labourers Labourers Labourers
February
February 2007 March 2007 March 2007
2007
1 Andhra Pradesh 407 405 407 404
2 Assam 388 395 390 397
3 Bihar 388 394 388 394
4 Gujarat 405 408 406 409
5 Haryana 404 406 405 408
6 Himachal Pradesh 373 370 380 380
7 Jammu & Kashmir 395 399 397 400
8 Karnataka 373 373 372 373
9 Kerala 379 376 382 379
10 Madhya Pradesh 391 390 395 394
11 Maharashtra 407 405 404 403
12 Manipur 332 334 332 335
13 Meghalaya 413 412 411 410
14 Orissa 365 366 366 367
15 Punjab 423 421 424 422
16 Rajasthan 422 423 420 422
17 Tamil Nadu 378 375 377 374
18 Tripura 380 386 370 374
19 Uttar Pradesh 412 415 412 415
 20 West Bengal 362 365 365 368
ALL INDIA 392 392 393 393

The Labour Bureau has announced new series AICPI for industrial workers with base
2001. The index numbers from 2006 are obtained by multiplying it with the link factor of
4.63 The All India Consumer Price Index Number for Industrial Workers (CPI-IW) (base
2001-100) during March 2007 decreased by one point to stand at 127 (one hundred and
twenty seven) points.

The Rise/Fall in index varied from centre to centre. The index during March 2007
decreased by 3 points in Sholapur centre. It decreased by 2 points in 8 centres, and 1
point in 17 centres.

The index recorded the highest increase of 4 points in Labac Silchar and Siliguri centres.
It increased by 3 points in Kodarma centre, by 2 points each in 5 centres and by 1 point in
18 centres. While in the remaining 26 centres the index remained stationary.

The decrease of 3 points in Sholapur centre was the outcome of decrease in the prices of
Rice, Wheat, Jowar, Arhar Dal, Onion, Garlic, Vegetable & Fruit Items, Electricity
Charges etc.

The increase of 4 points in Labac-Silchar centre was mainly on account of the rise in the
prices of Rice, Fish Fresh, Pan Leaves etc. while in Siliguri centre the increase was
mainly due to increase in the prices of Rice, Wheat Atta, Urd Dal, Masur Dal, Mustard
Oil, Pork, Chillies Green, Vegetable & Fruit items, Cinema Charges etc.

DA CALCULATION

Dearness Allowance (DA) is an allowance paid to employees to compensate them for

erosion of real income / wage due to inflation, which they were getting on a particular
bench-mark date. This bench-mark date is generally the date from which a pay structure /
a set of pay scales is given effect to.

18.2 The increase in the cost of living and the consequent erosion of income is measured
in terms of a consumer price index number and, DA to be sanctioned to employees is
determined on the basis of the percentage increase in that index or the point-factor
system.

18.3 The very concept of DA is a post-Second World War phenomenon. Initially, the
frequency and quantum of DA given were more or less on an adhoc basis, by way of
response to demand of employees for wage increases to mitigate their hardship. Later on,
the payment of DA was linked to a Consumer Price Index number. Consequently, a
formula came to be evolved, with reference to :

a) the basis for computation of increase in cost of living,

b) the frequency of DA revision and

c) the extent to which neutralisation of such increase would be given.

18.4 Periodical Committees / Commissions were constituted in the past by the Central
Government to examine the question of payment of DA to the employees. The
Committees’ / Commissions’ recommendations were generally accepted and
implemented by the Government of India and the State Governments also followed it.

18.5 The III Central Pay Commission (CPC) recommended payment of DA whenever the
CPI rose by 8 points over the index of 200 (with base 1960 = 100). This principle was
changed in 1986 as per the recommendations of the IV CPC. The IV CPC recommended
the grant of DA on a 'percentage system' of the basic pay.

18.6 Similarly, the extent of neutralisation of price increases given to various categories
of employees has also undergone change from time to time. However, the general pattern
adopted, all over the country is to give the benefit of 100% neutralisation to the lower
categories of employees, with tapering scale of neutralisation to higher categories of
officials. The extent of neutralisation granted with effect from 1-1-1973 (based on the
Report of III CPC) ranged from 100 per cent to 35 per cent. But, upon the
recommendation of the IV CPC, this method of neutralisation has been altered with effect
from 1-1-1986.

18.7 As per the recommendation of the IV CPC, DA was admissible twice a year, that is,
on 1st January and 1st July and each instalment of DA was calculated with reference to
the percentage increase in the 12 monthly average of All India Consumer Price Index
(AICPI) (base 1960) over the average index of 608, which was the base for the pay scales
recommended by IV CPC. Thus the extent of neutralisation based on the
recommendation of IV CPC ranged from 100 per cent to 65 per cent. This system of
tapering scale of neutralisation was rested on the assumption that employees drawing
higher salary would be able to absorb the impact of price rise to certain extent, but lower
categories of employees need full protection in the interest of social justice, since they
cannot withstand the effects of price-rise.

18.8 However, it may be noted that even 100 per cent neutralisation may only protect the
real value of wages of employees as on a fixed, earlier bench-mark date, but it does not
add to their real income. Similarly, the higher salaried officials would feel the pinch of
erosion in their real income on the lower percentage of neutralisation. Besides, over a
period of time, such tapering neutralisation of DA would seriously distort the relativity of
pay scales that have been determined after taking into account factors like qualifications,
training, nature of work, degree of responsibilities etc.
18.9 The anomaly in the differential neutralisation has been highlighted in the report of
the Karnataka IV Pay Commission in 1992, of which, the Chairman of the present
Commission was also its Chairman. There, the IV Karnataka Pay Commission observed :

"We are highlighting these issues to bring out the unfairness which is inherent in the
present scheme of neutralisation of DA for price rise. We have refrained from making
any specific recommendation in this regard mainly because the scheme has been evolved
on All India basis and the State Government has adopted it. We only hope that the future
Pay Commission appointed by Government of India will take note of the drawbacks in
the scheme of neutralisation of DA for rising price and formulate a more objective
scheme based on fairness."1

18.10 The V CPC has also realised the injustice in the graduated scale of neutralisation
formulae. It has observed :

"Inflation neutralisation on a graduated scale in the present circumstances will be

anachronistic and unduly unjust to senior officers.

It went a step further and said :

" . . . . . . . the Government’s conscious intervention in removal of the unjust practice of

differential neutralisation of DA is a must. Accordingly, we recommend that inflation
neutralisation be made uniform at 100 per cent at all levels."

1. Report of the Karnataka Fourth Pay Commission,

18.11 The V CPC, among other things recommended that AICPI for Industrial workers to
be continued as the basis for the purposes of calculating DA and the existing practice of
using 12-monthly average of AICPI for calculating DA also to be continued.

18.12 The Government of India and also the State Governments in general have accepted
and implemented the principles enunciated by the V CPC.

18.13 We consider that the same principle of neutralisation should be extended to Judicial
Officers also.

OUR RECOMMENDATION :

18.14 We recommend that the same DA formula as being implemented at present to the
Central Government employees be followed in the case of Judicial Officers, in every
State / UT.

WAGE RATES AND DEARNESS ALLOWANCE

3.1 INTRODUCTION
The availability of information on wages and earnings of workers is an important
parameter to assess the wage level in the country. If we consider the level of
unemployment and under employment as an index of economic distress among the
members of workforce, the level of wages and earnings of workers serve as an indicator
of the economic prosperity of the working population.

Ever since the introduction of planned economy, the living standards of the working
population have become dependant, more or less, on levels of earnings. Other types of
income are at times, significant but for most of the workers, earnings from paid
employment constitute the major source of income. Earnings or take home
wages/salaries, which provide means of livelihood, tend to conform to the income needed
to enable the labour force to maintain its customary standard of living in the long run. If
the greater employment means the ability of a large number of persons to satisfy their
needs, increased real earnings mean greater satisfaction of their wants.

3.2 WAGE RATES

In order to ensure comparability, the term ‘Wage Rate’, has been defined as the sum of
basic wage and dearness allowance in respect of workers who receive both these
components, while for other workers the actual consolidated amount of earnings
represent wage rate. The wage rates were collected for all the occupations. The monthly,
fortnightly or weekly wages actually paid are divided by the actual number of mandays
worked to arrive at the daily wage rates.

3.3 AVERAGE DAILY WAGE RATES BY STRATUM

The details of average daily wage rates of the workers by Stratum and Sexage are
presented in Table 3.1. A perusal of the Table reveals that the average daily wage rates in
the Tea Processing Industry were Rs. 64.75 at all India level. At the stratum level, the
lowest average daily wage rate of Rs. 59.05 was recorded by Assam, followed by Rs.
65.29 in West Bengal. On the other hand, the highest average daily wage rate of Rs.
86.92 was reported from Kerala, followed by Rs. 79.83 in Tamil Nadu.

3.4 AVERAGE DAILY WAGE RATES BY SEXAGE

The Table 3.1 reveals that average daily wage rates were reported at Rs. 65.03 for men,
Rs. 63.82 for women and Rs. 24.36 for adolescent workers in the Tea Processing
Industry. The average daily wages of women workers were reported to be less than that
of the men workers in the entire strata in the Tea Processing Industry. The highest
average daily wage rate of women workers was reported at Rs. 82.41 from Kerala,
whereas, lowest average daily wage of women workers was reported at Rs.52.24 from
Assam.

3.5 AVERAGE DAILY WAGE RATE BY OCCUPATION AND SEXAGE

The average daily wage rates by occupation and sexage for all the workers employed in
the Tea Processing Industry are presented in Table 3.2. The highest average daily wage
rate at the occupation level was reported at Rs 132.54 in 'Mechanic (General)' occupation,
followed by Rs. 123.41 in 'Fitter' and Rs. 121.09 in 'Electrician' occupations. The lowest
average daily wage rate was reported at Rs. 52.37 in 'Fermenting Room Attendant'
occupation, followed by Rs. 54.05 in 'Sign Maker' and Rs. 55.02 in 'Picker Coolie'
occupations. The average daily wage rate was found to be more than Rs. 100 in just 6
occupations out of a total of 27 occupations reported in the Tea Processing Industry.
However, it has been noticed that none of the women workers employed in Tea
Processing industry was getting average daily wage rate of Rs. 100 or more.

The female workers were found employed in only 8 occupations out of a total of 27
reported occupations in the Tea Processing Industry. Out of these 8 occupations, in which
female workers were employed, the average daily wage rates of female worker were
higher than that of their male counterparts in 5 occupations, viz., 'Helper', 'Sweeper', 'Tea
Sorter', 'Picker Coolie' and 'Withering Loft Attendant'.

3.6 TREND IN WAGE RATES AND REAL WAGE RATES

Trends in average daily wage rates of workers in Tea Processing Industry have been
presented in Table 3.3. The Table reveals that there has been increasing trend in the
average daily wage rates of workers in Tea Processing Industry.

In order to assess the improvement in the economic conditions of the workers, it is

necessary to examine the data on real wage rates. The real wage rates for the year y1 have
been worked out with reference to the All India Consumer Price Index Numbers by
shifting its base to the year y0=100. Symbolically, the Real Wage Rates for the year y1
with respect to the year y0 may be defined as:

1960AICPIy0
REy1 = ---------- x Ey1
y1
1960AICPI

where,

Ey1 = Actual earnings for the year y1

REy1 = Real earnings for the year y1
y0
1960AICPI = All India CPI Number for year y0 with base 1960=100
y1
1960AICPI = All India CPI Number for year y1 with base 1960=100

The real wage rates and percentage increase in real wage rates in a round with respect to
that in the previous round in the Tea Processing Industry have been depicted in Table 3.3.
The Table reveals that the real wage rates of the workers increased at the rate of 20.86 per
cent during the sixth round as compared to that during the fifth round.
3.7 DEARNESS ALLOWANCE

Dearness Allowance (DA) is paid to the employee to compensate them for erosion in the
wages due to increase in the price level. The system of payment of DA has its own
diversity and disparity in the pattern of payment of remuneration to employees. A fairly
large number of industrial establishments in the country pay a separate allowance known
as the dearness allowance to supplement the wages of their employees or to neutralize the
impact of rising prices on the wage earnings. It includes any payment made to protect the
employees against the inflation and rising prices, viz., dearness allowance (DA), variable
dearness allowance (VDA), interim relief, dearness pay, etc. Since the payment of
dearness allowance is not occupation specific, therefore, the information collected during
the survey covered all employees in the sample units.

3.7.1 EXTENT OF DEARNESS ALLOWANCE PAYMENT

Stratum-wise number of units paying DA as a separate component of wages/salaries is

given in Table 3.4. It is observed that 87.08 per cent of the units covered in the survey
are paying dearness allowance as a separate component of wages/salaries in the Tea
Processing Industry. It is further observed that hundred per cent units are paying
dearness allowance in two strata, viz., West Bengal and Kerala in the Tea Processing
Industry. The lowest percentage of units paying dearness allowance was observed in
Tamil Nadu (56.40 per cent), followed by Residual Stratum (70.83 per cent). In Assam,
91.24 per cent of units were paying dearness allowance as a separate component of wages
to their employees.

Out of the total units paying dearness allowance to their employees, 82.45 per cent of the
DA paying units were reported to be using CPI Numbers brought out by Labour Bureau
for payment of DA to their employees. Only 1.85 per cent of the DA paying units were
using CPI Series brought out by State Governments. The remaining 15.70 per cent of the
DA paying units were paying dearness allowance to their employees without using any
CPI Series. In Assam and West Bengal Strata, all the DA paying units were using CPI
Numbers brought out by Labour Bureau. In Kerala, however, none of the DA paying
units was using Bureau or State Series of CPI Numbers for payment of DA to their
employees. In Tamil Nadu, only 26.67 per cent DA paying units were using Bureau
Series of CPI Numbers and rest of 73.33 per cent DA paying units were using other
mechanism for payment of DA to their employees.

It is further observed that all the units using Labour Bureau’s CPI Numbers for payment
of dearness allowances to its employees, were using CPI Numbers with Base Year
1982=100 in the Tea Processing Industry.

While analysing data on the percentage use of Labour Bureau’s Consumer Price Index
centres, it is observed that all the units were using only All India Consumer Price Index
Number (AICPI).
3.7.2 EXTENT OF EMPLOYEES RECEIVING DEARNESS ALLOWANCE

Table 3.5 reveals that only 29.58 per cent employees were getting dearness allowance in
the Tea Processing Industry. However, it is observed that all the employees were getting
dearness allowance in Kerala. The lowest percentage of employees receiving dearness
allowance was reported in Assam (13.54 per cent) followed by Tamil Nadu (14.77 per
cent).

3.7.3 PERCENTAGE DISTRIBUTION OF UNITS PAYING DEARNESS

ALLOWANCE BY CRITERION FOR PAYMENT

A variety of methods and procedures are adopted by industrial units for computation and
payment of dearness allowance to their employees. The methods followed by units are
either according to changes in Consumer Price Index Numbers or linked to Pay
Scales/Slabs or paid at a Flat Rate or combination of all these systems. Distribution of
dearness allowance paying units by system of DA payment is presented in Table 3.6. The
Table reveals that only two of the above mentioned methods were in force in varying
degrees in the Tea Processing Industry. Majority of the DA paying units (84.28 per cent)
was paying dearness allowance according to changes in Consumer Price Index Numbers,
whiles the remaining 15.72 per cent DA paying units were paying DA at Flat Rates.

REVISED VARIABLE DEARNESS ALLOWANCE FOR AGRICULTURAL

WORKERS FROM APRIL
Workers employed in agriculture are to receive higher Variable Dearness Allowance
(VDA) with effect from April 1, 2006. According to the Chief Labour Commissioner
(Central) the new rates of VDA calculated on six monthly average of Consumer Price
Index for Industrial Workers reaching 545 from 526 as on December 31, 2005 ( base
182=100 ) would be as under in ‘A’, ‘B’ and ‘C’ areas :
Category of worker Rates of V.D.A. as area wise
(in Rupees)
A B C
Unskilled 5.05 4.59 4.58
Semi-skilled/Unskilled 5.51 5.06 4.61
Supervisory
Skilled/Clerical 5.98 5.51 5.05

Highly Skilled 6.67 6.20 5.51

Therefore, the minimum rates of wages including the basic rates and Variable
Dearness Allowance payable w.e.f 1-04-2006 to the employees working in Agriculture
will be as under :-
Category of worker Rates of V.D.A. as area wise
(in Rupees)
 A B C
Unskilled 114.00 + 5.05 104.00 + 4.59 102.00 + 4.58
119.05 108.59 106.58
Semi-skilled/Unskilled 125.00 + 5.51 116.00 + 5.06 107.00 +4.61
Supervisory
130.51 121.06 111.61
Skilled/ Clerical 137.00 + 5.98 125.00 +5.51 115.00 +5.05
142.98 130.51 120.05
Highly Skilled 153.00 +6.67 141.00 +6.20 125.00 + 5.51
159.67 147.20 130.51

The classification of cities into areas A,B and C is as follows: