Court Emphasizes Mandatory Statutory Procedure Under Minimum Wages Act, 1948 Must Be Followed Despite Repeal; Rejects Government's Reliance on Stakeholder Meetings and Inoperative Notifications
In a significant judgment dated October 1, 2026, the Karnataka High Court (Division Bench) dismissed an intra-court appeal filed by the Karnataka Textile Mills Association and Clothing Manufacturers Association of India against the order of a Single Judge that quashed the State Government's notification revising minimum wages for the Garments Industry. The Court affirmed the requirement of strict compliance with the statutory procedure prescribed under Section 5(1)(b) of the Minimum Wages Act, 1948 ("Act of 1948"), holding that the Government could not bypass the mandatory publication of draft notifications in the Official Gazette and the statutory opportunity for objections, even if stakeholder meetings and advisory board consultations were conducted.
The dispute arose after the State Government issued a draft notification on February 22, 2018, proposing revised minimum wages for garment workers, which was subsequently withdrawn on March 22, 2018. Following a Division Bench judgment on April 13, 2020, the withdrawal was set aside, and the draft notification was revived, directing the Government to take further steps in accordance with the Act. However, the Government issued a fresh notification on January 17, 2023, fixing wages based on a 14% increase over rates fixed by an earlier notification dated October 31, 2019, which had been held inoperative by the same Division Bench.
The petitioners, represented by the Garment and Textile Workers Union, challenged the 2023 notification as being procedurally flawed and resulting in inadequate wages. The learned Single Judge agreed, holding that the Government's failure to republish the draft notification in the Gazette and to allow objections as mandated by the Act rendered the notification unsustainable. The Single Judge also found fault with the Government's use of an inoperative earlier notification as a base for wage revision.
The Division Bench, while hearing the appeal, upheld the Single Judge's ruling. It emphasized that the procedural safeguards under Section 5(1)(b) are mandatory and cannot be substituted by informal consultations or advisory board meetings. The Court clarified that the earlier Division Bench judgment required the Government to complete the statutory process afresh after reviving the draft notification. It also dismissed the contention that the repeal of the Minimum Wages Act by the Code on Wages, 2019, effective November 21, 2025, barred the completion of the pending wage revision exercise, holding that accrued rights and pending proceedings are saved under the general saving clauses.
Furthermore, the Court rejected the argument that the notification's effective date and conditional interest direction imposed retrospective or unconditional liabilities. It observed that the final notification must fix the effective date within five years from the previous fixation date of February 21, 2014, and that interest at 6% per annum would be payable only if the fresh wages fixed exceed those already paid, calculated on the unpaid differential amount from the date it becomes due.
The Court also clarified a clerical error in the Single Judge's order referring to the "Payment of Wages Act, 1948" instead of the "Minimum Wages Act, 1948," stating that the substantive conclusions remain unaffected.
In conclusion, the Karnataka High Court's judgment underscores the primacy of following mandatory statutory procedures in wage fixation and revision under the Minimum Wages Act, 1948. It mandates the State Government to complete the wage revision exercise for the garment industry expeditiously, ensuring procedural fairness and protection of workers' rights, while recognizing the Government's discretion in determining the quantum of wages after proper process.
Bottom Line:
Minimum Wages Act, 1948 - Revision of minimum wages under Section 5(1)(b) - After revival of draft notification by earlier Division Bench judgment, mandatory statutory procedure of publication in Official Gazette and inviting objections could not be bypassed by stakeholder meetings or Advisory Board consultations - Notification fixing revised wages on basis of inoperative earlier notification rightly quashed - Repeal of Minimum Wages Act by Code on Wages, 2019 does not defeat accrued rights or pending proceedings for completion of wage revision exercise.
Statutory provision(s):
Minimum Wages Act, 1948 Section 5(1)(b), Section 5(2); Code on Wages, 2019 Section 69; General Clauses Act, 1897 Section 6
