Minimum Wage Fixing Convention, 1970 (No. 131) - Nepal (Ratification: 1974)

Direct Request (CEACR) - adopted 2022, published 111st ILC session (2023)

Article 5 of the Convention. Enforcement. The Committee notes that, in reply to its previous comment, the Government indicates in its report, that: (i) the Labour Office is assigned with the authority to monitor the implementation of provisions on minimum wages under section 93(1) of the 2017 Labour Act; (ii) pursuant to sections 162, 163 and 165 of the 2017 Labour Act workers have the right to file a complaint against violations of the Labour Act or the rules made under the Labour Act, the Labour Office has the power to decide to make an employer pay a compensation in case of non-compliance with the minimum wage, and the Labour Office decisions can be appealed at the Labour Court; (iii) no complaints have been received regarding minimum wages until present; and (iv) the 2018 Labour Rules prescribe that employers shall specify in their annual labour audit report if any workers are paid less than the prescribed minimum remuneration. The Committee requests the Government to provide information on the application of the above-mentioned provisions in practice, including the functioning of the annual labour audit reporting system in practice and the activities carried out by the Labour Office related to the enforcement of minimum wages, the number of violations to minimum wage legislation detected and the sanctions imposed, as well as the number of complaints on minimum wages filed and treated and the decisions of the Labour Court in case of appeals.

Direct Request (CEACR) - adopted 2019, published 109th ILC session (2021)

Article 1 of the Convention. Coverage of all groups of wage earners. The Committee notes the adoption of a new Labour Act, Act No. 14 of 2017, which contains provisions on minimum wage fixing in sections 106 and 107. Further to its previous comments on the coverage of the minimum wage system, the Committee notes with interest that, unlike previous legislation, the new Labour Act applies to all enterprises irrespective of the number of workers employed (section 2(j)), and that section 88(1) establishes that the Government may fix a minimum wage for domestic workers. It also notes that, while the Labour Act does not apply to the civil service and services established under special laws (section 180), it provides that where the special laws do not have provisions on wages, employment conditions and benefits, the Labour Act shall be automatically applicable in relation to those matters. The Committee also notes the Government’s indications in its report that the monthly wages of civil servants are fixed by the Government, on the recommendation of committees formed for reviewing wages, in application of the corresponding special legislation.

Article 4(2) and (3). Full consultation with and direct participation of employers and workers in the minimum wage-fixing machinery. Further to its previous comments, the Committee notes with interest that section 107(1) of the Labour Act provides for the establishment of a permanent tripartite Minimum Wage Fixing Committee (MWFC) responsible for formulating recommendations on the minimum wage. It also notes that section 106(1) establishes that the Government may fix the minimum wage in the case that the MWFC fails to recommend the minimum wage due to lack of consensus.

Article 5. Enforcement. The Committee notes that section 182 of the Labour Act provides that the Government may make necessary rules for the effective enforcement of the Act and that during that process, separate rules for businesses, services and industries with special characteristics or for the informal sector may be made. The Committee requests the Government to indicate whether any rules have been adopted under section 182 to ensure the effective enforcement of the Labour Act, and to provide information particularly on the measures taken or envisaged to ensure compliance with the provisions therein on the minimum wage.

Direct Request (CEACR) - adopted 2012, published 102nd ILC session (2013)

Articles 1 and 4 of the Convention. Minimum wage fixing machinery – Excluded categories of workers – Full consultations with and direct participation of the social partners. The Committee notes the latest increases of the minimum wages in the private sector. It notes, in particular, that pursuant to a Notice published in the Nepal Gazette on 23 May 2011, the minimum wage for the organized sector with the exception of the tea plantation sector, is now fixed at 3,550 Nepalese rupee (NPR) (approximately US$41.5) per month, or NPR221 (approximately $2.60) per day, while by virtue of another notice published in the Nepal Gazette on 13 November 2011, the minimum wage for workers employed in tea plantation estates is now fixed at NPR4,424 (approximately $51.5) per month, or NPR158 (approximately $2) per day. It also notes that the Government has fixed the minimum wage for agricultural workers at NPR221 (approximately $2.60) per day. The Committee requests the Government to transmit copies of the notices establishing the abovementioned minimum pay rates.

With regard to earlier comments of the General Federation of the Nepalese Trade Unions (GEFONT) concerning the replacement of permanent posts in the civil service by service contracts which often carry wages lower than the minimum wage rates, the Committee notes that the Government’s report contains no response. The Committee understands that public sector employees are not covered by the minimum wage legislation as they are not deemed to be “employees” within the meaning of section 2 of the Labour Act of 1992. The Committee recalls, in this connection, that domestic workers and workers in enterprises of less than ten workers are also excluded from minimum wage coverage. The Committee accordingly requests the Government to indicate any measures taken or envisaged with a view to extending minimum wage protection to the categories of workers currently excluded from the scope of minimum wage provisions of the Labour Act.

Furthermore, the Committee recalls that in previous comments it had drawn the Government’s attention to section 21(5) of the Labour Act which empowers the Government to fix the minimum wage when it is not possible to set up the Minimum Remuneration Determination Committee. Recalling that under the Convention the Government is obliged to create and maintain conditions allowing for full consultations with, and direct participation of the social partners at all stages of the minimum wage fixing process, the Committee requests the Government to consider appropriate action – possibly in the context of the on-going process of drafting new labour laws – to ensure that the national legislation fully reflects the requirements of the Convention on this point.

Observation (CEACR) - adopted 2008, published 98th ILC session (2009)

The Committee notes the observations made by the General Federation of Nepalese Trade Unions (GEFONT) concerning the application of the Convention. While acknowledging the consultative processes followed by the Government in determining the minimum wages for the private sector, tea estates and the agricultural sector, GEFONT considers that during the same period the Government has taken legislative action that directly violates the letter and the spirit of the Convention. More concretely, GEFONT refers to the Civil Service Act of 1993, as amended by its Second Amendment Ordinance of 2005, section 7(3) of which provides for the abolition of any permanent posts in the civil service falling vacant and their replacement by service contracts which often carry wages lower than the minimum pay rates. According to the workers’ organization, the Government, under the pretext that the minimum wage does not apply to public employees, resorts to labour-only contracting which permits it to offer remuneration at less than the minimum wage rate to workers recruited through manpower agencies. In addition, many workers in the civil service allegedly work without any holidays and social security coverage. GEFONT further states that it had suggested the establishment of a tripartite minimum wage committee when the first amendment to the Journalists Labour Act of 1995 was discussed, but the proposal was rejected. The Committee requests the Government to transmit any comments it may wish to make in reply to the observations of GEFONT. It would also appreciate receiving the Government’s reply on the points raised in the Committee’s previous direct request.

Direct Request (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes the information contained in the Government’s report and attached documents. It also notes the ongoing efforts for labour law reform through the social dialogue process, with the assistance of the International Labour Office.

Article 1(1) of the Convention. System of minimum wages. The Committee notes that the minimum wage rates have last been adjusted in 2006 and are now set at NPR2,200 (approximately US$34) per month, or NPR125 (approximately US$1.9) per day, for the organized sector with the exception of the tea plantation sector, and NPR2,660 (approximately US$41) per month, or NPR95 (approximately US$1.4) per day, for the workers employed in tea plantation estates. The Committee would be grateful if the Government would indicate whether the Minimum Remuneration Determination Committee has been fully consulted in the revision process and, if so, which were the elements and criteria it used for its recommendations (e.g. official surveys on national economic conditions, statistical data on the evolution of the consumer price index, unemployment rate, productivity, etc.).

Article 2(1). Lower minimum wage rates based on worker’s age. The Committee notes the Government’s statement that while the minimum wage legislation continues to provide for different rates for young persons between 14 and 16 years of age, the principle of equal remuneration for work of equal value is not affected, as the working hours of the young persons concerned are proportionally limited (no more than six hours per day and 36 hours per week) compared to the working hours of adults, in accordance with section 3 of the Labour Rules 1993. Considering the particular risk of abuse this age group of workers faces, the Committee would appreciate if the Government would supply information on the approximate number of workers remunerated at lower rates on account of their age, labour inspection results showing the number of wage-related infringements committed against young workers, as well as any specific protective measures the Government intends to take in their regard.

Article 4(2) and (3). Full consultation and direct participation of employers’ and workers’ representatives. The Committee notes the Government’s indication that in the case of agricultural workers, district development committees can determine minimum wage rates at the district level, provided that these rates are not lower than the national minimum wage rates. Noting that section 176 of the Local Self-Governance Act 2055 (1999) that sets out the membership of District Development Committees does not provide for the equitable representation of employers’ and workers’ interests in the minimum wage fixing function of these bodies, the Committee requests the Government to provide additional explanations in this respect.

Article 5 and Part V of the report form. The Committee notes the Government’s explanations concerning the role of the labour offices, the district administration offices and the Labour Court in ensuring compliance with the minimum wage legislation. It also notes the Government’s reference to difficulties of enforcement due to limited institutional infrastructure and financial resources but also the fact that the majority of workers are employed in the informal sector. The Committee would be grateful if the Government would continue to provide up to date information on the practical application of the Convention, both in terms of coverage and enforcement of the system of minimum wages, as well as any alternative strategies with a view to ensuring decent wage levels for workers in the informal economy.

Direct Request (CEACR) - adopted 2003, published 92nd ILC session (2004)

The Committee notes the information supplied by the Government in response to its previous comment.

Article 1, paragraph 1, of the Convention. The Committee notes the Government’s indication that the Minimum Remuneration Determination Committee is set up every two years and that two such committees are currently in operation to fix minimum wages for organized and tea plantation sectors. The Committee requests the Government to keep it informed of the results of the deliberations of these committees and also to forward a copy of the statutory instruments prescribing the new minimum wage rates once they are issued.

Article 2, paragraph 1. The Committee notes that the notices of 15 March and 25 April 2000 fixing minimum monthly remuneration for workers employed in tea estates and those employed in all establishments other than tea estates prescribe lower wage rates for minors who are defined as workers and employees between 14 and 16 years of age. In this connection, the Committee recalls that, in the absence of any provision in the Convention providing for the fixing of different minimum wage rates on the basis of criteria such as the workers’ age, the general principles laid down in other instruments have to be observed, and particularly those contained in the Preamble of the ILO Constitution which specifically refers to the application of the principle of equal remuneration for work of equal value. The Committee further recalls paragraph 176 of its General Survey of 1992 on minimum wages in which it stated that the reasons that prompted the adoption of lower minimum wage rates for groups of workers on account of their age should be regularly re-examined in the light of the principle of equal remuneration for work of equal value. The Committee requests therefore the Government to keep it informed of any developments in respect of minimum wage differentials based on the workers’ age.

Article 4, paragraphs 2 and 3. The Committee recalls its previous comment in which it raised the question of compatibility between the requirements of the Convention for full consultation and direct participation of employers’ and workers’ representatives in the operation of the minimum wage-fixing machinery and section 21(5) of the Labour Act, 1992, as amended, that empowers the Government to prescribe minimum wage rates applicable to workers and employees of establishments when it is not possible to form the Minimum Remuneration Determination Committee. In its reply, the Government states that this provision is only a saving clause and a safeguard for unforeseeable situations. In this connection, the Committee considers it essential to reaffirm the fundamental importance it attaches to the principle of consultation and participation of the social partners in all procedures concerning minimum wage fixing. According to the letter and the spirit of the Convention, the consultation must take place before decisions are taken and must be effective, that is to say it must enable employers’ and workers’ organizations to have a useful say in matters that are the subject of consultation, while the participation of employers and workers must be direct, including the possibility that the parties concerned form part of the relevant bodies. It must also be effective - that is to say that the opinions reached by the parties concerned should be duly taken into consideration - and it should take place on an equal footing. The Committee is of the view that the Government is under the obligation to create and maintain conditions permitting the full consultation and direct participation of the social partners in all circumstances, and therefore invites the Government to consider amending its legislation to give full effect to the provisions of the Convention in this respect.

Article 5 and Part V of the report form. The Committee notes the Government’s indication that, with reference to the enforcement of minimum wage legislation, there have been hundreds of complaints lodged with different labour offices and that penalties have been imposed within the jurisdiction of the competent authorities. The Committee also notes the figures concerning the number of workers employed in agricultural and non-agricultural occupations and covered by the general labour legislation. The Committee hopes that the Government will take all necessary steps and will soon be in a position to communicate detailed information on the effect given in practice to the Convention, including extracts from reports of inspection services showing the results of inspections carried out (e.g. the number of infringements recorded, the sanctions imposed, etc.), statistical data on the number of workers to whom minimum wages apply, copies of any recent studies and surveys referring to minimum wage questions as well as any other particulars bearing on the functioning of the minimum wage fixing machinery.

Direct Request (CEACR) - adopted 2001, published 90th ILC session (2002)

The Committee notes the information supplied by the Government in its reports, in particular the adoption of the Labour (First Amendment) Act of 28 January 1998 and the issue of Notice of 15 March 2000 fixing minimum wages for workers employed in tea estates, and Notice of 25 April 2000 fixing minimum wages for workers employed in all establishments other than tea estates. It also notes the observations made by the General Federation of Nepalese Trade Unions concerning the application of the Convention and would appreciate receiving the Government’s reply to those comments.

Article 4(2) and (3) of the Convention. The Committee notes that under section 21(5) of the Labour Act, 1992, as amended, in circumstances when it is not possible to form the Minimum Remuneration Determination Committee, or when the committee, even if formed, is unable to make any recommendation, nothing shall prevent His Majesty’s Government from prescribing the minimum wage rates applicable to workers and employees of establishments. The Committee is bound to observe, in this connection, that such provision is not consistent with the requirements of the Convention since it calls into question one of its fundamental principles, that is the principle of full consultation and direct participation of representative employers’ and workers’ organizations in the procedure for fixing and adjusting minimum wages, as set forth under this Article. The Committee therefore asks the Government to take the necessary action to bring the national legislation into conformity with the Convention. It also requests the Government to communicate in its next report any progress achieved in this regard.

Articles 2 and 5. Further to its previous comments, the Committee notes that under section 57 of the Labour Act, as amended, any person who acts in contravention of the provisions of the Act or the rules or written orders or directives issued under the Act is liable to a fine not exceeding Rs.10,000 depending on the nature and gravity of the offence. The Committee again requests the Government to provide additional information on the enforcement of the legislation on minimum wages, including labour inspection results, the number and type of infringements recorded and the penalties imposed.

Part V of the report form. The Committee would be grateful to the Government for providing all available information on the manner in which the Convention is applied in practice, including, for instance, the approximate number of workers covered by relevant legislation, the minimum wage rates applicable in the different sectors and categories of workers, and any other particulars concerning the fulfilment of the practical conditions prescribed by the Convention.

Direct Request (CEACR) - adopted 1997, published 86th ILC session (1998)

The Committee notes that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the following matters raised in its previous direct request:

Article 1 of the Convention. The Committee notes with interest the statement of the Government that the provisions of the Convention have been incorporated in the Labour Act, 1992 and its subsequent Labour Rules, 1993. The Government specifies that the system of minimum wages, established after having usually consulted workers' and employers' representatives, covers four categories of workers classified as unskilled, semi-skilled, skilled and highly skilled. The Committee requests the Government to supply a copy of the Labour Rules, 1993. It also hopes that the Government will provide further information on the following matters: (i) the approximate number of workers covered by the minimum wage fixing machinery; and (ii) to what extent the agricultural, transport and plantation sectors are or will be covered by the minimum wage fixing machinery. In this connection, the Committee recalls that, according to the Government's earlier reports, Bills were being drafted to extend the coverage of the minimum wage fixing machinery to the rural sectors, particularly to plantation workers and that draft regulations were still under examination. The Committee requests the Government to report on progress made in this respect.

Article 4. The Committee notes that the machinery set up for fixing and adjusting minimum wages consists of the Minimum Remunerations Fixation Committee which is a tripartite body (under Labour Act, 1992, section 21(2) and (3)). The Government states that necessary consultations as concerns minimum wage fixing have been made with the various trade unions and employers' organizations pursuant to section 21(6) of the Labour Act, 1992. However, it further indicates that this Committee has not been formed yet, due to various reasons. The Committee requests the Government to indicate measures taken to ensure the full application of this important provision of the Convention.

Articles 2 and 5. The Committee notes the Government's indication that section 57 of the Labour Act, 1992 provides for sanctions in case of violation of the minimum wages provisions. It hopes that the Government will supply information on: (i) the effectiveness of the system of investigation of the minimum wage payment; (ii) the infringements recorded (type of infringement, number of infringements recorded, etc.); and (iii) the penalties imposed.

Direct Request (CEACR) - adopted 1995, published 82nd ILC session (1995)

The Committee notes with regret that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the following matters raised in its previous direct request:

Article 1 of the Convention. In its previous comments, the Committee noted that Bills were being drafted to extend the coverage of the minimum wage fixing machinery to the rural sectors, particularly to plantation workers. The Committee noted from the Government's last report that draft legislation to cover the agricultural, transport and plantation sectors were still under examination. The Committee requests the Government to report on progress made in this respect.

Articles 2 and 5. With reference to a statement made by the Government in a previous report, to the effect that tendencies to pay wages less than the minimum have been discouraged due to the effectiveness of the system of investigation, the Committee requests the Government to supply information on infringements recorded (type of infringement, number of infringements recorded, etc.) and on penalties imposed.

Direct Request (CEACR) - adopted 1995, published 83rd ILC session (1996)

The Committee takes note of the Government's reply to its previous comments.

Article 1 of the Convention. The Committee notes with interest the statement of the Government that the provisions of the Convention have been incorporated in the Labour Act, 1992 and its subsequent Labour Rules, 1993. The Government specifies that the system of minimum wages, established after having usually consulted workers' and employers' representatives, covers four categories of workers classified as unskilled, semi-skilled, skilled and highly skilled. The Committee requests the Government to supply a copy of the Labour Rules, 1993. It also hopes that the Government will provide further information on the following matters: (i) the approximate number of workers covered by the minimum wage fixing machinery; and (ii) to what extent the agricultural, transport and plantation sectors are or will be covered by the minimum wage fixing machinery. In this connection, the Committee recalls that, according to the Government's earlier reports, Bills were being drafted to extend the coverage of the minimum wage fixing machinery to the rural sectors, particularly to plantation workers and that draft regulations were still under examination. The Committee requests the Government to report on progress made in this respect.

Article 4. The Committee notes that the machinery set up for fixing and adjusting minimum wages consists of the Minimum Remunerations Fixation Committee which is a tripartite body (under Labour Act, 1992, section 21(2) and (3)). The Government states that necessary consultations as concerns minimum wage fixing have been made with the various trade unions and employers' organizations pursuant to section 21(6) of the Labour Act, 1992. However, it further indicates that this Committee has not been formed yet, due to various reasons. The Committee requests the Government to indicate measures taken to ensure the full application of this important provision of the Convention.

Articles 2 and 5. The Committee notes the Government's indication that section 57 of the Labour Act, 1992 provides for sanctions in case of violation of the minimum wages provisions. It hopes that the Government will supply information on: (i) the effectiveness of the system of investigation of the minimum wage payment; (ii) the infringements recorded (type of infringement, number of infringements recorded, etc.); and (iii) the penalties imposed.

Direct Request (CEACR) - adopted 1994, published 81st ILC session (1994)

The Committee notes with regret that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the following matters raised in its previous direct request:

Article 1 of the Convention. In its previous comments, the Committee noted that Bills were being drafted to extend the coverage of the minimum wage fixing machinery to the rural sectors, particularly to plantation workers. The Committee noted from the Government's last report that draft legislation to cover the agricultural, transport and plantation sectors were still under examination. The Committee requests the Government to report on progress made in this respect.

Articles 2 and 5. With reference to a statement made by the Government in a previous report, to the effect that tendencies to pay wages less than the minimum have been discouraged due to the effectiveness of the system of investigation, the Committee requests the Government to supply information on infringements recorded (type of infringement, number of infringements recorded, etc.) and on penalties imposed.

Direct Request (CEACR) - adopted 1993, published 80th ILC session (1993)

The Committee notes that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the following matters raised in its previous direct request:

Article 1 of the Convention. In its previous comments, the Committee noted that Bills were being drafted to extend the coverage of the minimum wage fixing machinery to the rural sectors, particularly to plantation workers. The Committee noted from the Government's last report that draft legislation to cover the agricultural, transport and plantation sectors were still under examination. The Committee requests the Government to report on progress made in this respect.

Articles 2 and 5. With reference to a statement made by the Government in a previous report, to the effect that tendencies to pay wages less than the minimum have been discouraged due to the effectiveness of the system of investigation, the Committee requests the Government to supply information on infringements recorded (type of infringement, number of infringements recorded, etc.) and on penalties imposed.

Direct Request (CEACR) - adopted 1989, published 76th ILC session (1989)

Article 1 of the Convention. In its previous comments, the Committee noted that Bills were being drafted to extend the coverage of the minimum wage-fixing machinery to the rural sectors, particularly to plantation workers. The Committee notes from the Government's report that draft legislation to cover the agricultural, transport and plantation sectors are still under examination. The Committee requests the Government to report on progress made in this respect.

Articles 2 and 5. With reference to a statement made by the Government in a previous report, to the effect that tendencies to pay wages less than the minimum have been discouraged due to the effectiveness of the system of investigation, the Committee requests the Government to supply information on infringements recorded (type of infringement, number of infringements recorded, etc.) and on penalties imposed.