Growth And Development Of Wage Boards Business Essay

The establishment of wage boards has come to be generally accepted in India as a practical wage determination system. The planks have been successful in satisfying their primary object of promoting industry-wise discussions and active participation by the celebrations in willpower of salary and other conditions of employment.


Wage planks are set up by the Government, but in collection of members of wages boards, the government cannot appoint associates arbitrarily. Members to wage planks can be appointed only with the consent of employers and employees. The staff of employers on the wage boards are the nominees of employers' business and the individuals' representatives will be the nominees of the national middle of trade unions of the industry concerned.

The structure of wage planks is as a rule tripartite, representing the interests of labour, Management and People. Labour and management reps are nominated in similar numbers by the government, with consultation and consent of major Central Organizations. These boards are chaired by administration nominated members representing the public. Wage panel function industry-wise with broad terms of reference, which include recommending the minimum wage differential, cost of living, settlement, regional income differentials, gratuity, hours of work etc.


(a) To work out wage structure predicated on the concepts of fair wages as formulated by the Committee on Fair Wages.

(b) To work through a system of payment by results.

(c) To advance a wage composition based on certain requirements of social justice.

(d) To evolve a wage structure based on the need for adjusting income differentials in a manner to provide incentives to employees for improving their skill.


The history of wage planks in India goes back to the 1930's. The Royal Commission on Labour suggested the setting up of tripartite planks in Indian market sectors. It said

We would call focus on certain cardinal details in the environment of (income - mending) machinery of this kind. The main process is the connection of associates of both employers and workers in the constitution of the equipment. Such staff would be contained in equal members, with an independent element, chosen as far as possible in contract with or, after assessment with, the staff of both the parties.

Take decisions regarding wage modifications or on research from celebrations or from the government.

No action was considered throughout that plan period. However, the Second Plan emphasized the need for determining wages through industrial income boards. It detected.

The existing machinery for the arrangement of income disputes hasn't given full satisfaction to the functions concerned. More suitable equipment for settling income disputes will be the one which gives the functions themselves a far more responsible role in achieving decisions. An authority like a tripartite wage mother board, consisting of an equal number of staff of employers and staff and an unbiased chairman, will most likely ensure more suitable decisions. Such income boards should be instituted for individual industries in various areas. This advice was eventually reiterated by the 15th Indian Labour meeting in 1957 and different industrial committees. The government decision to setup the first income board in natural cotton textile and sugars business in 1957 was also influenced by the Report of the ILO.

The appointment of the wage plank often results from the demands for labour unions. It has been reported: The forming of wage boards in all companies has been the result of demands and stresses for trade unions. Within their work to secure the appointment of wage boards, trade unions have to repressurise not only the federal government but also the employers whose formal or informal consent to their establishment must be obtained.

In India, the Bombay Industrial Relations (Amendment) Work of 1948 may be thought to be perhaps the first legislation included a provision for the establishment of income boards in any industry included in the act. Accordingly, the first wage board was set up in Bombay for the natural cotton textile industry. The principal reason for starting wage boards was to alleviate the Industrial Courts and Labour Courts of an integral part of their adjudication work. The amending take action of 1953 has tried out to avoid multiplicity of proceedings under the Function. It empowered Industrial Courts and Labour Courts income boards to choose all matters connected with or arising out of any professional matter or dispute.

Industries Covered

The first non - statutory income board was set up for the silk cotton textile and sugar market sectors in 1957. Since that time, 24 wage planks covering almost all of the major market sectors, have been set up by the Centre: organic cotton textiles, sugar, concrete, working journalists and non - working journalists (double each), jute, tea, espresso and silicone plantations, iron ore, coal mining, flat iron and steel, anatomist, plug-ins and docks, leather and leather goods, limestone and dolomite. On 17th July 1985, three wage planks were constituted, one each for working journalists, non - working journalists and the sugar industry. But no central take action consists of any provision for setting up wage boards. They may be set up by an answer of the government; and they come to an end with the submission of their reports.


The wage panel is, as a rule, tripartite body representing the interest of labour, management and the general public. Labour and management staff are nominated in identical numbers by the government, after appointment with and with the consent of major central organizations. Generally, the labour and management staff are determined from the particular industry which is looked into. These boards are chaired by federal government - nominated members representing the general public.

They function industry - wise with broad conditions of reference, such as recommending the least wage, differential cost of living reimbursement, regional wage differentials, gratuity hours of work, etc.

Wage boards must

a. Determine which categories of employees (manual, clerical supervisory, etc. ) are to helped bring within the range of wage fixation.

b. Workout a wage structure based on the ideas of fair wages created by the committee on fair wages.

c. Suggest a system of repayment by results.

d. Work out the principles which should govern bonus to personnel in industries.

In addition to these common items, some income boards may be asked to deal with the question of Bonus offer (like this of the income boards for concrete, glucose and jute establishments); gratuity (like that of the wage boards for iron ore mining, limestone and dolomite mining establishments) and the next wage mother board on cotton textile industry; requirements for payments apart from wages (wage planks for jute and iron and metallic industry); time of work (silicone plantation industry); interim pain relief (wage boards for jute industry and post and dock personnel).

Some wage planks (Wage planks for sugar, jute, iron ore, silicone, tea and caffeine plantations, limestone and dolomite mining business) have been required to look at the 'special top features of the industry'.

Thus, wage planks have had to cope with a large variety of subjects. Of these, the fixation of wage - scales on an industry - smart basis constitutes the biggest of all the issues before them.

In changing a wage structure, the board takes into account
(a) the needs of the industry in a producing economy including the need for preserving and promoting exports

(b) certain requirements of interpersonal justice, which ensures that the workman who produces the products has a fair package, is paid sufficiently well to be able at least to support himself and his family in an acceptable degree of comfort, and this he is not exploited;

(c) the need for adjusting income differentials (which is in relation to occupational differentials; inter-firm differentials; regional or inter-area differentials; inter-industry differentials and differentials predicated on sex) in that manner concerning provide incentives to employees for increasing their skills.

For the determination of fair salary, the board must consider such factors as the amount of skill required for his work, the exhaustion involved, the training and experience of the worker, the responsibility under-taken, the mental and physical requirements for work, the disagreeableness or otherwise of the task and the risks involved with it. The mother board must make anticipated allowances for a fair come back on capital, remuneration to management and good allocation to reserve and depreciation.


Although wage planks are create by the government, the basic reason for their establishment is the pressure brought to bear on the federal government, by the trade unions, professional federations and nationwide organizations on the main one hand following the employers' formal or casual consent on the other. Pressure has been used for the session of wage boards for the jute industry by the jute staff association as well as for the coal mining industry by their trade union. The forming of wage planks in other market sectors has been the result of similar demands and pressures on the part of trade unions - such as plantations, flat iron and material, engineer, sugar electricity.

The administration cannot appoint customers of the income boards within an arbitrary way. Impartial users can be appointed only with the consent of employers and employees. The reps of employers on income boards will be the nominees of the employer's organisation and the staff representatives are the nominees of the nationwide company of trade unions of the industry worried. However, before their real appointment, a great deal of negotiations happen not only between the two main reclaculatrant hobbies but also among different communities representing particular pursuits.

Item to be included for the consideration of the income boards will be the end result of the discussions between the parties. The issues are unanimously dependant on trade unions and employers; but these invariably relate with gratuity, bonus, time of work and give of interim alleviation. The quantum of interim relief is also decided by negations and bargaining which have sometimes resulted in short-term deadlocks.

The panel functions in three steps:

1. The first step is to get ready a comprehensive questionnaires made to collect home elevators the prevailing income rates and skill differentials, means of assessing an industry's paying capacity and workloads, potential clients for industry in the immediate future, and regional variations in the costs of widely used consumer goods. The questionnaire is delivered to labour unions, employers associations, interested individuals, academics organisations and federal agencies.

2. The second step is to give a public ability to hear at which market leaders of labour unions and employers associations, not symbolized on the board, as well as others considering the industry involved, are given a verbal or dental bearing on issues interacting with salary, working conditions and other items.

3. The third step is to convene secret sessions at which members of the table make proposals and counter - proposals about the items protected under the conditions of reference point.

In the case of failure to attain a unanimous decision on the problems, each party has the to veto others decision.

The role of 3rd party members on the plank is bound to conciliation and mediation; they make an effort to prevent deadlocks by promoting communication between labour and management reps. They also offer advice and recommendations to the gatherings, but the ultimate decision must derive from the celebrations give - and - take attitudes and compromises.

The decision - unanimous suggestions - is on paper by means of a written report and posted to the federal government, which usually allows unanimous agreements, though it may change any provisions thereof. Then the report is to be put together with by the get-togethers. The government does not have any legal powers to enforce the board's recommendations. It will try to persuade the parties to slim their dissimilarities and aim to unanimity.

Wage boards like their own time in the submission of reviews, e. g. , the second wage panel for concrete and the first income board for natural cotton textiles and sugars took just a little less than three years; while the income table for coal mining, non journalists, jute, flat iron and steel needed just a little over three years; that for tea plantations required 5 Ѕ years as well as for caffeine plantation 4 years and flat iron ore mining 5 years. A number of the wage planks constituted in 1964 didn't submit records even by 1969, e. g. , heavy chemicals, fertilizers, anatomist industries and plug-ins and docks. The common time considered by wage boards in the finalization of their deliberations varies from 3 years to 5 Ѕ years.

The significant reasons for the wait in the conclusion of wage planks work have been

1. Schedule delays in the recruitment of staff; prep and printing of questionnaires;

2. Getting replies to questionnaires

3. Time involved with general population hearings and

4. Lack of accord among members in arriving at a conclusion.


The boards have prevailed in rewarding their primary object of promoting industry - sensible negotiations and active contribution by the parties in the persistence of salary and other conditions of work. The following quotation indicate the success of the institution

The board's deliberations and accolades have added significantly on the development of a nationwide and 'development oriented' prospect on questions pertaining to particular areas and areas. They have given serious focus on the impact (of wage increase) on factors like prices, work and the success of the industry.

The committee setup by the National Payment on Labour recognized three major problems that the wage planks suffer

1. Most the recommendations of the income boards are not unanimous.

2. The time used by the income planks to complete their activity has been rather unduly long and

3. The execution of the tips of the income boards has been difficult.

But it figured the system of wage boards has, on the whole served a useful goal. As bipartite collective bargaining on salary and allied issues on an industry smart basis at the national level is not found practicable at the moment for various reasons, this system has provided the equipment for the same. It is true that the machine has not fully fulfilled all the prospects; and, particularly lately, there's been an erosion of trust in this technique for both employers and employees. The Committee is convinced that these flaws aren't such as cannot be remedied.


The committee made some important suggestions. These have been given below

1. the chairman of the income should selected by common consent of the organizations of employers and employees in the industry concerned.

2. In future, the income panel should function essentially as equipment for collective bargaining and really should strive for unity.

3. Wage planks should be aided by technical assessors and experts.

4. The terms of reference point of wage boards should be decided by the government in appointment with the organisations of employers and the personnel concerned.

5. A central wage board should be setup in the Union Ministry of Labour on a everlasting basis to provide all wage boards through the way to obtain statistical and together material and loaning of the required staff.

6. Unanimous advice of wage planks should be accepted and in case of non - unanimous recommendations, the federal government should keep consultations with the organizations of employers and employees before taking a ultimate decision.

7. Wage planks should not be set up under any statues, but their advice, as finally accepted by the government, should be produced statutorily binding on the celebrations.

8. For the establishments covered by wage boards, a long lasting equipment should be created for follow-up action.

9. Wage planks should complete their work in a single years time and the operation of its advice should be between two or three years, and the need for a succeeding wage boards should be considered on merit.

If these recommendations are accepted, the working of wage boards may be made more affective.


Q1. What do you understand by wage panel? Why you can find need of salary board?

Q2. Enumerate the many establishments list under the salary board.

Q3. Explain the structure and functions of wage board?

Q4. How do you want to evaluate the success of wage board?

Q5. Discuss the working of the wage board?

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