State minimum-wage rates apply where the State Government is the appropriate government for contract labour.

The Central Government Industrial Tribunal, in Reference No. 39 of 2022, held that contract workers engaged for Bridge and Roof Company (India) Ltd. were entitled to minimum wages at the rates fixed by the Central Government from time to time, but found no evidence supporting the union’s specific claim of ₹26,000 per month.

The company challenged the award, arguing, among other things, that the Central Government rates did not apply and that the appropriate government was the State Government.

The High Court considered the applicable-government issue and the applicability of the minimum-wage rates to the contract workers.

Whether the Central Government’s minimum-wage rates applied to the contract workers engaged through contractors for work at the petitioner’s establishment.

Whether the Tribunal’s award directing payment at Central Government minimum-wage rates could stand.

Section 2(b) of the Minimum Wages Act, 1948 identifies the appropriate government: the Central Government for specified scheduled employments, including employment carried on by or under its authority and employment in a corporation established by a Central Act; otherwise, the State Government is the appropriate government.

In Steel Authority of India Ltd. v. National Union Waterfront Workers, the Supreme Court held that Central Government ownership or control of a company does not, by itself, make the Central Government the appropriate government; the relevant statutory and factual conditions must be satisfied.

The judgment also relied on Nashik Workers Union v. Hindustan Aeronautics Ltd. concerning the appropriate government under the Industrial Disputes Act.

The Court referred to National Union Waterfront Workers in concluding that the West Bengal Government was the appropriate government under the Contract Labour (Regulation and Abolition) Act, 1970.

The Court noted that the workers were engaged through contractors supplying labour for work within the State.

It reasoned that the Supreme Court’s decision in National Union Waterfront Workers supported the conclusion that the West Bengal Government was the appropriate government under the contract-labour legislation.

The Court then held that, on that basis, State minimum-wage rates applied to the contract workers, rather than the Central Government rates directed by the Tribunal.

It did not separately determine the petitioner’s other challenges, including its submissions concerning the Tribunal’s jurisdiction and the non-joinder of contractors.

It allowed the writ petition, disposed of any connected applications, and vacated any interim order.