Do Minimum wages encourage Skills Development?
T he ultimate beneficiary of the minimum wages is the workforce segmented into "unskilled, semi-skilled, skilled and highly-skilled". Hence, ideally, the wage matrix must encourage the potential worker to up skill / re skill so be able to earn a higher wage to improve his / her quality of life. Do minimum wages backed by the Code on Wages Act 2019, which has replaced the Minimum Wages Act, 1948; Payment of Wages Act, 1936; Payment of Bonus Act, 1965; and Equal Remuneration Act, 1976 really encourage skills development? Or there is a room for further improvement!! Just as a matter of interest, the minimum wages are calculated based on a complex matrix basis of a family of four members ie husband, wife, and two children below the age of 14 years. The husband is taken as 1 unit, wife as 0.8 and children as 0.6 each. Thus taking a family as 03 consumption units. There have been some suggestions lately to include parents also. The wage takes into account several parameters ...