India’s minimum wage framework got its most significant overhaul since 1948 when the Code on Wages, 2019 became fully operational on April 1, 2026. The national floor wage now stands at ₹178 per day — and state rates range from ₹7,410 to over ₹23,000 per month depending on skill category and location. If you’re hiring in India or checking what you’re legally owed, here’s what the rules actually say.

What Is the National Floor Level Minimum Wage?

The national floor level minimum wage is the absolute baseline set by the Central Government — no state government can set its minimum wage below this figure. As of 2026, it stands at ₹178 per day, which works out to approximately ₹4,628 per month based on 26 working days.

This floor is not the wage most workers in formal employment receive — most state rates are significantly higher. But it matters for two reasons: first, it defines the floor below which any wage agreement (contract, collective bargaining, or employer policy) is void; second, it sets the benchmark for new states and sectors being brought under minimum wage coverage for the first time under the Code on Wages.

The Central Government revises the national floor periodically based on the Consumer Price Index for Industrial Workers (CPI-IW). The April 2026 revision added 11.28 CPI points to the previous base rates, pushing central sphere wages upward across all skill categories.

Central Government Minimum Wages (April 2026 Revision)

For establishments that fall under central government jurisdiction — railways, mines, oil fields, major ports, central public sector undertakings, and certain construction projects — the Central Government sets its own rates, which are higher than the national floor.

After the April 1, 2026 revision:

– Unskilled (Area A — metro zones): ₹21,346 per month
– Skilled (Area A): ₹24,870 per month
– Highly Skilled (Area A): ₹28,444 per month

Area B and Area C rates are lower, reflecting cost-of-living differences outside major metros. Central sphere wages are revised every April and October based on CPI-IW updates.

These rates apply specifically to central sphere industries. Most private sector employers — factories, shops, IT companies, staffing firms — are governed by their respective state minimum wages, which vary significantly.

State-Wise Minimum Wages: The Gap Is Large

The difference between Indian states is striking. Delhi, which has long maintained some of the highest minimum wages in the country, sets unskilled rates at around ₹18,066 per month, with skilled workers at ₹23,905 per month as of 2026. Rajasthan, at the lower end, pegs unskilled wages at roughly ₹7,410 per month.

That’s a 2.4x gap for the same category of work, purely based on which state you’re employed in.

A rough picture across major employment states (April 2026 unskilled monthly rates):
– Delhi: ₹18,066
– Maharashtra (Mumbai): ₹14,842
– Karnataka (Bengaluru): ₹13,500 (approx.)
– Tamil Nadu (Chennai): ₹11,200 (approx.)
– Telangana (Hyderabad): ₹11,000 (approx.)
– Gujarat: ₹11,800 (approx.)
– Uttar Pradesh: ₹8,568 (approx.)
– Madhya Pradesh: ₹12,150
– Rajasthan: ₹7,410

These figures are approximate and subject to biannual revisions. Skill categories (unskilled, semi-skilled, skilled, highly skilled) and industry sectors further affect the rate. The authoritative source is each state’s Labour Department official gazette notification.

One important note: these are minimum wages, not average wages. The actual wages in sectors like IT services, BFSI, and pharma in Hyderabad, Bengaluru, or Pune are typically far above these floors. The minimums matter most for frontline workers, daily-wage earners, contract staff, and workers in manufacturing, construction, retail, and domestic services.

What Changed Under the Code on Wages 2019

Before the Code on Wages, India had five separate wage-related laws — the Minimum Wages Act (1948), the Payment of Wages Act (1936), the Equal Remuneration Act (1976), and others. The Code on Wages 2019 consolidated all of these into a single statute, making compliance simpler in theory and enforcement sharper in practice.

Key changes employers need to understand:

Universal coverage. The old Minimum Wages Act only covered scheduled employments — a defined list of industries. The Code on Wages covers *every* employment without exception, including gig workers and domestic workers for the first time.

The 50% wage rule. This is the change most corporate HR teams underestimated. Under the Code, an employee’s “wages” for the purpose of calculations must constitute at least 50% of total CTC. If allowances (HRA, travel, special allowance) push the non-wage component above 50%, the excess gets added back to the wage base. This affects PF contributions, gratuity liability, and overtime calculations — all of which are based on wages, not CTC.

Overtime at double rate. Overtime must be paid at twice the regular rate of wages — no more time-and-a-half or token overtime payments.

Full and final within two working days. All dues — wages, earned leave encashment, pending allowances — must be settled within two working days of separation, not the 30–45 days most companies treated as standard.

Equal wages for equal work. The Code on Wages codifies the principle of equal remuneration for work of equal value, regardless of gender. Employers cannot legally pay a woman less than a man (or vice versa) for identical work in the same establishment.

Variable Dearness Allowance (VDA) and Wage Revision Schedule

Most minimum wages in India consist of two parts: a basic minimum wage and a Variable Dearness Allowance (VDA) linked to CPI-IW. VDA is revised periodically to offset inflation, which is why the effective minimum wage changes even when the base rate doesn’t.

Revision schedules vary by state:
– Most states: April 1 and October 1
– Maharashtra: January 1 and July 1
– Uttar Pradesh: annually in March
– Central Government: April and October

This means an employer who checked minimum wage compliance in January 2026 may already be non-compliant by April 2026 if they didn’t apply the revised VDA. Payroll systems that don’t auto-update for VDA revisions are a liability.

Penalties for Non-Compliance

The Code on Wages sets clear penalties:

– First offence: Fine up to ₹50,000
– Repeat offence: Imprisonment up to 3 months, or fine up to ₹1 lakh, or both
– Failure to maintain wage registers or records: Separate fine up to ₹10,000

Labour inspectors under the Code have expanded authority — they can inspect payroll records, interview workers, and issue improvement notices. The old practice of keeping two sets of wage records is significantly harder to sustain under the Code’s digital reporting requirements.

A complaint from a single worker earning below minimum wage can trigger an audit of the entire establishment’s payroll.

Minimum Wages and Women Workers: What the Code Adds

For women in the Indian workforce — particularly in manufacturing, retail, domestic service, and the gig economy — the Code on Wages brings three specific protections worth knowing:

Equal wages. The equal remuneration provision in the Code is now backed by penalty clauses, not just civil liability. An employer who pays women less than men for identical work faces the same fines as those paying below minimum wage.

Night shift consent and safety. Sections of the Code on Occupational Safety require written consent from women for night-shift work, along with safe transport and adequate rest facilities. Employers who require night-shift work without this framework risk compliance action alongside any wage disputes.

Domestic and gig workers now covered. The Code on Wages covers domestic workers and platform-based gig workers for the first time. This matters significantly for women employed as household help, delivery workers, or home-based care providers — categories where non-payment of minimum wages was previously difficult to enforce.

At ePeople India, we specifically screen employers for statutory compliance — minimum wages, appointment letters, and payment timelines — before connecting them with candidates. Zero placement fees, full compliance. That’s the standard we hold.

Practical Checklist for Employers in 2026

If you’re hiring in India — whether through a staffing partner or directly — here’s what you need to have in place:

1. Know your applicable state rate. The rate depends on where the work is performed, not where your registered office is.
2. Apply the VDA revision. Check whether your payroll updated for the April 2026 CPI revision. If not, you may already be underpaying.
3. Audit your wage structure for the 50% rule. If Basic + DA is below 50% of CTC, restructure before the next payroll cycle.
4. Issue appointment letters. Mandatory for all hires — permanent, fixed-term, and contract.
5. Set up a digital wage register. Paper registers are still permitted but digital records are increasingly expected during audits.
6. Settle Full & Final within two working days. Build this into your exit process now.

FAQ

Q1: What is India’s minimum wage in 2026?
The national floor level minimum wage is ₹178 per day (approximately ₹4,628/month). State rates are higher: Delhi pays ₹18,066/month for unskilled workers; highly skilled workers in central sphere establishments can earn up to ₹28,444/month. The actual applicable rate depends on your state, skill category, and industry sector.

Q2: What is the Code on Wages 2019 and when did it come into effect?
The Code on Wages 2019 consolidated India’s five separate wage laws — including the Minimum Wages Act 1948 and Equal Remuneration Act 1976 — into a single statute. It became fully operational from April 1, 2026. It expands minimum wage coverage to all workers (including gig and domestic workers) and introduces the 50% wage rule and two-day F&F settlement requirement.

Q3: How often are minimum wages revised in India?
Most states revise minimum wages twice a year — on April 1 and October 1 — based on CPI-IW updates that adjust the Variable Dearness Allowance (VDA). Maharashtra revises in January and July; Uttar Pradesh revises annually in March. Central government rates for centrally covered sectors are also revised in April and October.

Q4: Can a placement agency charge the minimum wage to the employer’s worker without the worker knowing?
No. Placement agencies (and any employer) are legally prohibited from charging workers any amount that brings their effective take-home below the minimum wage. Under both the Code on Wages and the Private Placement Agencies (draft) norms, any deduction from a worker’s wages for agency fees that brings pay below minimum wage is void. ePeople India charges zero placement fees — employers pay nothing, workers pay nothing.

Q5: Are women entitled to the same minimum wage as men in India?
Yes. The Code on Wages codifies equal remuneration for work of equal value — the same rate applies regardless of gender. Paying women below the rate paid to men for identical work is both a wage violation and an equal remuneration violation, each attracting separate penalties.

Q6: What happens if an employer pays below minimum wage?
Penalties under the Code on Wages: up to ₹50,000 fine for a first offence; up to ₹1 lakh fine or 3 months’ imprisonment for repeat offences. A single worker’s complaint can trigger a full payroll audit of the establishment. Back wages must also be paid for the period of non-compliance.

Post a Job or Find One — No Placement Fees

Whether you’re an employer structuring compliant CTC packages under the new wage codes or a job seeker checking your rights before accepting an offer, ePeople India connects both sides — with zero fees at every stage.

Related Reading

• New Labour Codes India 2026: impact on salary, PF and leave
• Equal Pay for Women India 2026: Code on Wages and how to claim
• TDS on Salary India 2026: Form 16, Section 192 and deduction guide
• Gratuity Calculation India 2026: formula, eligibility and new rules
• India Minimum Wages 2026: state-wise rates, floor wage and what changed

👉 Employers: Post a Job and access verified candidates who understand their statutory rights.
👉 Job Seekers: Find Jobs and work only with employers who pay what the law requires.

*Written by Sid, Workforce Policy Analyst at ePeople India. Sid covers India labour regulations, minimum wages, and hiring compliance for employers across sectors.*