And yes, we need a minimum wage law for manual labour

Dont ask for my salary slip Why India should copy Massachusettss equal-pay law
Voices Career Sunday, August 07, 2016 - 16:44

The problem with India is that we don't copy enough at the institutional level. Not enough leverage as best practice.  Given the Indian job market and unequal powers enjoyed by employers, we could do well in adopting this new landmark legislation from the state of Massachusetts in the United States.

The Governor of Massachusetts recently signed a law mandating equal pay for comparable work.

What does this mean? In addition to addressing gender parity, that is men and women get paid the same, the law forbids employers from asking prospective employees for salary history before offering a job, reports Forbes.

In other words, when the candidate is hired, the company must pay based on the candidate's worth and not past earnings. There can thus be no bias based on previous salaries and undervaluing the worth of employees.

This helps employees get a better bargain from their new employers. Men and especially women who have been paid less than or at the lower end of range will now be paid to what the business perceives they merit. 

If the offer doesn't suit, the candidate is of course welcome to negotiate or reject. The business is only offering and agreeing to what it deems affordable and worthy, no quarrel there. It relieves both ends of the baggage of past errors.

This is novel despite its simplicity. It allows business to acquire talent at deserving compensation, hence resulting in better quality goods and services. It also has the potential to reduce attrition. Businesses, consumers, labour and the market benefit.

India must copy this without hesitation and put more money into the hands of the middle class. This will boost buying and consumption and is goodness for the internal economy.

Further, India must augment existing wage policy by increasing and enforcing minimum wages for manual casual labor.

This is the bulk of Indian labour, working not in manufacturing or services but construction, domestic sector and farms.  Elevating those incomes allows for more spending money, primarily on food and essentials. This further fillips internal economy.

The challenge as always is the gap between policy on one end and its implementation and enforcement on the other. The Prime Minister Narendra Modi himself acknowledged in his maiden Townhall meeting that last mile delivery is as important as policies. What is difficult to gauge is if that is a statement of intent to increase efficiency and accountability, or a statement of resignation that the last mile is often within the states.

At any rate, policy cannot be held hostage to delivery corruption and inefficiency. It must herald the future. These policies are no-brainers ripe for leverage. It can leap frog a society caught in the below net struggle. It is good for liberal economics. Good for labour. Good for state, good for families.

Note: The views expressed here are the personal opinions of the author.

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