Let’s start by defining minimum wage. Minimum wage refers to a minimum salary set by law to be reimbursed by an employer to the employee. It is prohibited for an employer to violate the minimum wages act or reduce the wages via a contract or agreement with an employee. Minimum wages cannot be pared down either through individual contracts or by collective agreement.
Employers used to treat the workers unfairly and forced them to work at meager wages. The minimum wages act was introduced to stop the instances of employees’ exploitation by employers. It intends to protect the employees from undue low wages and exploitation and safeguard their dignity and other rights.
Minimum wages are meant to protect the employees against unduly low wages. It facilitates ensuring an equitable and just share of the outcomes of the work to all. Minimum wages are also deemed as a part of an initiative to reduce poverty and overcome inequality in society.
Minimum wages can be established by the decision of a qualified authority, labor courts, industrial court, wage council, wage board, or by a statute. Minimum wages can be fixed by providing the force of law to collective agreement provisions.