The revision in minimum wages announced recently by the State government has been appreciated and at the same time criticised by certain industry bodies
The revision of minimum wages for skilled and unskilled workers in the State of Goa notified by the State government recently has mandated a payment of Rs. 407 a day for the unskilled worker, Rs. 468 for the semi-skilled and Rs. 523 for the skilled worker. The hike on an average was Rs. 100 more than the previously notified wages. All the three categories are in addition mandated to be paid a Variable Dearness Allowance (VDA) of Rs. 105, according to the notification. Previously the minimum wage was Rs. 307 for the unskilled workers Rs. 368 for semi-skilled and Rs. 423 for the skilled. These rates were last revised in 2016.
The Goa Chamber of Commerce and Industry (GCCI) has requested for a balanced approach that takes into consideration the concerns of both workers and businesses, while taking note of the ‘Minimum Wages’ notified by the State government recently. “We urge for a balanced approach that takes into consideration the concerns of both workers and businesses. Collaborative efforts between government authorities, labour representatives, and industry stakeholders are crucial to ensure that this wage revision doesn’t inadvertently burden businesses, hinder job creation, or disrupt economic growth,” said GCCI.
The Chamber further stated that the expected rates by the industry were lower than those notified. “It was unusual to observe that the notified minimum wages for employment in agriculture are also significantly higher than the ones proposed in the draft notification.
We are in the process of evaluating the impact of this decision on our member businesses. Such a revision has the potential to create a substantial impact on wage costs, and we foresee that some sectors may experience challenges in adapting to this change, particularly in the short term,” said GCCI.
The Chamber pointed out that the revision has resulted in an increase of `100 per day per worker from the existing basic wages. GCCI expressed that although the government is committed towards improving livelihoods of workers, it is important to acknowledge the likely results it may have on various sectors, especially the MSMEs which will be affected due to the revision in minimum wages.
GCCI has appreciated that the government had held extensive consultations with the industry before announcing their decision to revise minimum wages, especially for considering the objections raised and suggestions made by GCCI before finalising the notification.
The industry body has also hoped to have a balanced relationship between the government and industry to improve the commercial and industrial economy of Goa.
GCCI added that in the coming days, it will actively engage in discussions with their members and relevant stakeholders to better understand the implications and explore potential strategies for managing the increased wage costs. “Collaborative efforts between government authorities, labour representatives and industry stakeholders are crucial to ensure that this wage revision doesn’t inadvertently burden businesses, hinder job creation, or disrupt economic growth. In the coming days, we will actively engage in discussions with our members and relevant stakeholders to better understand the implications and explore potential strategies for managing the increased wage costs. Ease of Doing Business will be a priority on the list.”
GCCI expressed its commitment towards supporting member businesses and advocating for solutions that strike a fair balance between the interests of workers and the viability of enterprises.
“As we navigate through this transition, our focus remains on sustaining a conducive environment for economic growth, job creation, and the overall well-being of our communities,” said GCCI.
Meanwhile the All India Trade Union Congress (AITUC) has heavily criticised the revision of wages saying that it is unscientific, unjustified and unfair as it fails to take into consideration the hike in basic necessities like water, electricity, transport and cooking gas.
The GSIA has also expressed its dissatisfaction on the revision by pointing out that the quantum of the hike was the highest amongst all the states in India’s western region.
GSIA said that while the wage hike will be celebrated it will have an adverse impact on economic activity and disrupt the employment scenario.
The wage for the skilled worker which was Rs. 432, including VDA has now been hiked by Rs. 80 which will impact small and labour-intensive industry and employers.
It makes the minimum wage in Goa the highest in the region thus impacting the industrial investment climate and giving rise to the fear of potential flight of investment outside Goa.