Article link: Times
of India - Minimum wages for unorganised sector to rise as variable DA up
Extract from the
article:
The Centre has announced an increase in minimum wage rates for unorganized
sector workers by revising the variable dearness allowance (VDA).
This move aims to uplift the living standards of workers in the unorganized
sector by adjusting their wages periodically based on changes in the cost of
living index.
By pegging the annual wage rate increase to the Consumer Price Index
(rural), the government intends to provide more stability and predictability to
the income of these workers.
The revision of minimum wages for the unorganized sector is a significant
step towards addressing income disparities and ensuring fair compensation for
labor-intensive work.
This adjustment reflects the government's commitment to enhancing social
security and economic well-being for vulnerable sections of society, thereby
promoting inclusive growth and reducing poverty levels.
My Take:
As I reflect on my previously written blogs, the correlation between minimum
wages and government welfare schemes like MGNREGA (Mahatma Gandhi National
Rural Employment Guarantee Act) becomes more apparent. In my blog titled
"MGNREGA: Can it morph into UBI?" from May 2020, I highlighted the
importance of aligning daily wage rates under MGNREGA with the mandated minimum
wages to bridge the income gap and provide equitable compensation for labor
across rural and urban areas.
The recent decision to increase minimum wages for the unorganized sector
resonates with my proposition of renaming MGNREGA to MGNRUGA to encompass both
rural and urban households, along with incorporating skilled work categories
for enhanced income opportunities.
Similarly, in my blog on office productivity from July 2013, where I
discussed the impact of rising wages on workplace dynamics, the concept of
dearness allowance (DA) projections based on the Consumer Price Index (CPI)
aligns with the current policy shift towards linking wage rate revisions to the
rural CPI.
This consistent emphasis on adjusting wages in line with inflation trends
underscores the importance of ensuring fair and sustainable compensation
practices to boost employee morale and productivity.
Call to Action:
To the policymakers and authorities involved in setting wage policies for
the unorganized sector, I urge a comprehensive review of the wage structure to
ensure that it not only reflects the cost of living but also guarantees a
decent standard of living for workers.
Embracing a holistic approach that considers the diverse needs of both rural
and urban labor forces can lead to more equitable and inclusive economic
growth. Let's strive to create a sustainable wage framework that uplifts the
marginalized sections of society and fosters a more balanced and prosperous
economy.
With regards,
Hemen Parekh
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