Compliance & labour law · Updated September 2026
Minimum wages are the lowest legal pay rates for a job, fixed by government and revised for inflation. In India they are set under the Minimum Wages Act, 1948, which is being folded into the Code on Wages, 2019. An employer paying below the applicable minimum wage for the days worked is in breach, regardless of what the employment contract says.
Minimum wages are notified separately by each state, and by the central government for a few sectors, for each “scheduled employment”, meaning a listed industry or type of work. Within that, rates differ by:
Each rate has two parts: a fixed basic component and a variable dearness allowance, or VDA, that is revised, usually every six months in April and October, in line with the consumer price index. A notification will show a per-day and a per-month figure.
If the notified minimum for a semi-skilled worker in a given zone is, say, Rs 550 a day including VDA, the monthly equivalent is generally that daily rate multiplied by 26. Pay for a month with unpaid absence is pro-rated on the days actually attended or paid.
Not exactly. Compliance is tested against total wages for the relevant components, but a very low basic that dips under the notified minimum is a common audit finding.
The one for the state and scheduled employment where the work is actually performed, revised to the current VDA.
The VDA component typically changes twice a year, and states revise the basic component periodically, so the effective figure moves more than once a year.
Check pay against the applicable rate with the Minimum Wage Compliance Calculator. For the related annual entitlement, see statutory bonus, and for keeping per-state rates current, payroll software.