MINIMUM WAGES’ NONCOMPLIANCE PROBLEM IN PAKISTAN: A CASE STUDY OF HYDERABAD INDUSTRIAL SECTOR

Abstract

Minimum wage is a most debated topic since some decades at academic
and political levels but so far very diminutive consideration has been devoted to
verifying and considering the minimum wages policy implementation and
compliance subject. Even though Pakistan has adopted the policy of Minimum
wage fixing and continued setting and enforcing minimum wages to protect
vulnerable employees of industrial sector, the non-compliance remains an issue.
Compliance is done through implementation, and it is the process of placing a
rule into practice through rule creation, the setting up of institutions, and after
that rule enforcement. Through qualitative approach following interviews from
Hyderabad industrial sector and analysis of documents, it is revealed that
compliance of minimum wage is not in practice as a binding wage floor in
Pakistan. Most of the informal works are facing underpayment of wages. Many
factors contribute in the violence of minimum wages in industrial sector of
Pakistan which are lack of data, defective measure in fixing minimum wages;
deficient capacity of implementation and the lack of unions. The need of the time
is efforts and commitment which results in capacity building, adoption of
combined enforcement approaches for fair labour practices. A research should
be funded for Pakistan database for minimum wage statistics by the government
of Pakistan.