Q. Describe basic Concepts of wages ?

Concepts of wages:

Minimum wage: Minimum wage is the one which provide not merely for bare sustenance of life, but also the preservation of the efficiency of the worker. For this purpose, a minimum wage must also provide for some measure of education, medical requirements and amenities. Minimum wage may be tied by an agreement between the management and the worker, but it usually determined through legislation. This is more so in the unorganized sector where the labour is unionized. In the fixation of minimum wages, beside the needs of the workers, other factor like ability of the concern to pay, nature of the job and so on, are also considered.

Fair wage: this is understood in two ways. In a narrow sense, wage is a fair it it is equal to the rate prevailing in the same trade and in the neighbourhood for similar work. In a wider sense, it will be fair if it is equal to the predominant rate for the similar work throughout the country and for trade in general. Irrespective of the way in which fair wage is understood, it can be determined with reference to those industries where labour is well organized and has been able to bargain well with the employers.

Living wage: Living wage is a step higher than fair wage. Living wage may be described as one which should enable the wage earner to provide for himself / herself and his / her not only the bare essentials of life like food, clothing and shelter but a measure of frugal comfort including education for the children, protection against ill health, requirements of essential social needs, and / or measures of the insurance against the more important misfortunes including old age. A living wage must be fixed considering the general economic conditions of the country. This concepts of living wage, therefore, various from country to country. In the more advanced countries living wage itself forms the basis for the minimum wage.