The fixation of minimum rates of wage by time rate or piece rate is an important aspect of the Minimum Wages Act, 1948 in India. The act allows for the determination of minimum wages based on both time-based and piece-rate methods, depending on the nature of the employment.
Explanation of how minimum wage rates can be fixed using these methods:
- Time Rate:
- Under the time rate method, the minimum wage is fixed based on the time spent by an employee in performing a particular task or job. It is typically expressed as an hourly, daily, monthly, or weekly rate of pay.
- For example, if the minimum wage for a particular employment is determined by a time rate, an employee might be entitled to a certain amount for every hour of work performed.
- Piece Rate:
- Under the piece-rate method, the minimum wage is fixed based on the quantity of work completed or the number of pieces produced. In other words, workers are paid according to their output or the units they produce.
- For example, in a piece-rate system, a garment worker might be paid a fixed amount for each piece of clothing they produce.
