India: Minimum wage increase in Uttar Pradesh; companies have ‘no other option’
Garment workers in Uttar Pradesh, (India), now have a reason to rejoice as the State Government has increased the minimum wage of the workers. Currently the minimum wages for unskilled, semi-skilled and skilled workers are Rs. 7,674.45, Rs. 8,443 and Rs. 9,457.49 respectively. According to the new rule, the wage is supposed to get increased by Rs. 61, Rs. 69 and Rs. 76, respectively. These rates will be valid up to 31st March 2019.
The apparel manufacturing companies in Noida seem to be prepared for the rise. “Definitely increased wage is always a burden but there is no option. As we knew well in advance that minimum wage has to grow from this month, hence tentatively, one can plan in advance accordingly,” said Rajeev Bansal, MD, Celestial Knits & Fabs, Noida and Divisional Chairman, Indian industries Association, Meerut.
The full impact of the wage raise will be known in a few months, but as of now, the industry does not seem to be too worried, which is a positive sign.
Continuous increase in minimum wages in Delhi and Gurgaon, was one of the major reasons that few years ago, many apparel exporters shifted their factories to Noida. Now with this increased wage rates in Uttar Pradesh, the difference between the two main apparel manufacturing hubs of NCR – Noida and Gurgaon – has narrowed down to just Rs. 871, as the minimum wage for a skilled worker in Gurgaon is Rs. 10,328.83.
The proposed wage hike for Delhi is still in the court and various stakeholders have different opinions and reactions on this. In Delhi, the minimum wages of unskilled workers were revised in March 2017 from Rs. 9,724 to Rs. 13,350 per month, for semi-skilled workers from Rs. 10,764 to Rs. 14,698 and for skilled labourers from Rs. 11,830 to Rs. 16,182. In April 2018, there was again a little hike in these rates. As the Delhi High Court put a stay on the State Government’s notification, the issue is now in Supreme Court.