Section 5 Minimum Wages Act | Procedural Compliance Mandatory for Wage Revision Even Post-Repeal; Karnataka HC Quashes Notifications & Orders 6% Interest on Unpaid Wages : Karnataka HC

The Karnataka High Court has reaffirmed that procedural rigour under the Minimum Wages Act, 1948 is non-negotiable, even as the statute has been repealed by the Code on Wages, 2019. In a landmark batch of writ petitions, the Court quashed four notifications fixing minimum wages for textile and garment workers, holding that the State failed to follow mandatory statutory procedures before revising wages. The judgment also crystallized the entitlement of workers to 6% interest on unpaid wages and mandated a fresh revision exercise within six months.

Background & Facts

The Dispute

The petitioner, the Garment and Textile Workers Union (affiliated to AICCTU), challenged four notifications issued by the Government of Karnataka on 17.01.2023 under Section 5 of the Minimum Wages Act, 1948, revising minimum wages for four industries: (a) Cloth Dyeing and Printing, (b) Textile (Silk), (c) Spinning Mills, and (d) Garment, Costumes and Tailoring Establishments. The Union contended that the notifications were issued without following due procedure, were retrospective in effect, and reduced wages below those fixed under earlier valid notifications.

Key Facts

• The last wage revision for the industries occurred in 2014.
• On 30.12.2017, final notifications fixing minimum wages were issued for Cloth Dyeing and Printing, Textile (Silk), and Spinning Mills Industries.
• On 22.02.2018, a draft notification was issued for Garment, Costumes and Tailoring Establishments, proposing wage revision.
• On 22.03.2018, the Government withdrew both the three final notifications (30.12.2017) and the draft notification (22.02.2018), citing a need for fresh revision.
• Workers’ unions challenged the withdrawal order in writ petitions, which were dismissed by a Single Judge but later allowed by the Division Bench in Writ Appeal No.1520/2019 and connected matters, dated 13.04.2020.
• The Division Bench held that the withdrawal order dated 22.03.2018 was ultra vires the Act, 1948, and revived the three notifications dated 30.12.2017 and the draft notification dated 22.02.2018.
• The Division Bench also directed the Government to proceed further with wage revision under Section 5 of the Act, 1948.
• On 17.01.2023, the Government issued four new notifications revising wages, allegedly based on the inoperative notification dated 31.10.2019.
• The impugned notifications increased wages by 14% over the 31.10.2019 rates, but were lower than the 30.12.2017 rates.
• No proposal for revision was published in the Official Gazette after 13.04.2020, as required under Section 5(1)(b) of the Act, 1948.
• The Code on Wages, 2019 came into force on 21.11.2025, during the pendency of these petitions.

Procedural History

• 30.12.2017: Final notifications issued for three industries under Section 5(1)(b) of the Minimum Wages Act, 1948.
• 22.02.2018: Draft notification issued for Garment, Costumes and Tailoring Establishments.
• 22.03.2018: Government withdrew all four notifications.
• 2019: Writ Petitions filed by workers’ unions challenging the withdrawal order.
• 13.04.2020: Division Bench of Karnataka HC allowed the writ appeals, revived the 30.12.2017 and 22.02.2018 notifications, and directed the Government to proceed with revision under Section 5.
• 09.02.2021: Co-ordinate Bench in W.P. No.9268/2020 upheld the entitlement to interest at 6% p.a. on unpaid wages under the 30.12.2017 notifications.
• 17.01.2023: Four new notifications issued revising wages without publishing proposals in the Official Gazette.
• 21.11.2025: Code on Wages, 2019 came into force, repealing the Minimum Wages Act, 1948.
• 17.04.2026: Final hearing held in the batch of writ petitions.
• 03.06.2026: Judgment delivered by Justice Anant Ramanath Hegde.

The Parties' Positions

Petitioner (Garment and Textile Workers Union):

• Argued that the 17.01.2023 notifications violated Section 5(1)(b) of the Act, 1948 by omitting mandatory publication of proposals in the Official Gazette.
• Contended that the notifications were retrospective, bypassing the Division Bench’s directive to revise wages prospectively.
• Highlighted that wages under the impugned notifications were lower than those under the revived 30.12.2017 notifications.
• Asserted that the State discriminated against garment workers by fixing lower wages than other industries like Clay and Ceramics.
• Relied on Workmen represented by its Secretary v. Management of Reptakos Brett and Co. Ltd., Gujarat Mazdoor Sabha, and Private Hospital & Nursing Homes Association v. State of Karnataka.

Respondents (State of Karnataka and Employers’ Associations):

• Claimed that the 17.01.2023 notifications followed due process through the Tripartite Committee and Advisory Board meetings held on 06.09.2022 and 23.01.2022.
• Argued that the Government had the discretion to revise wages downward if justified by economic conditions.
• Contended that the Division Bench’s order did not mandate publication of a fresh proposal in the Official Gazette.
• Relied on Chakradharpur Biri and Tobacco Merchants’ Association v. State of Bihar and Champak Lal H. Thakkar v. State of Gujarat.
• Invoked Section 69 of the Code on Wages, 2019 to argue that proceedings under the repealed Act, 1948 were no longer maintainable.

Relief Sought

The petitioner sought:

• Quashing of the four notifications dated 17.01.2023.
• Payment of wages at the rates fixed under the notifications dated 30.12.2017 for the period 30.12.2017 to 17.01.2023.
• Payment of wages at the rates fixed under the draft notification dated 22.02.2018 for the period 01.04.2018 to 31.03.2023.
• Fixation of minimum wage for unskilled workers at Rs.29,090.91 per month.
• Payment of 6% interest on unpaid wages from the due date.

The Legal Issue

The central question was whether the State Government could issue revised minimum wage notifications under the Minimum Wages Act, 1948 without publishing a proposal in the Official Gazette as mandated by Section 5(1)(b), and whether rights accrued under the repealed Act survive for enforcement under the Code on Wages, 2019.

Arguments Presented

For the Petitioner

The petitioner relied on the binding precedent of the Division Bench’s order dated 13.04.2020, which revived the 30.12.2017 and 22.02.2018 notifications and explicitly directed the Government to proceed with wage revision "in accordance with the provisions of the Act, 1948." The petitioner argued that Section 5(1)(b) requires publication of a proposal in the Official Gazette with a two-month window for objections before any revision. The failure to do so after 13.04.2020 rendered the 17.01.2023 notifications procedurally invalid. The petitioner further cited Gujarat Mazdoor Sabha v. State of Gujarat to argue that wage revision must be upward and cannot be discriminatory. The Union emphasized that the garment industry employs over 7 lakh workers, 90% of whom are women from marginalized communities, and that the wage disparity with other industries was unjustifiable.

For the Respondent

The respondents contended that the Government had conducted multiple stakeholder consultations through the Advisory Board and Tripartite Committee, and that the absence of a Gazette notification was immaterial since the process was transparent. They relied on Chakradharpur Biri and Tobacco Merchants’ Association v. State of Bihar to argue that courts should not interfere with quasi-legislative wage-fixing decisions absent mala fide or arbitrariness. They further argued that Section 69(2) of the Code on Wages, 2019 extinguished the power to revise wages under the repealed Act, 1948, and that the petitions were therefore infructuous. They cited Gajraj Singh v. State Transport Appellate Tribunal and Pernod Ricard India v. State of Madhya Pradesh to assert that only accrued rights, not procedural powers, survive repeal.

The Court's Analysis

The Court undertook a meticulous analysis of the statutory framework under the Minimum Wages Act, 1948 and the transitional provisions of the Code on Wages, 2019. It held that Section 5(1)(b) of the Act, 1948 is mandatory and non-negotiable: "The publication of a proposal in the Official Gazette is not a formality but a statutory precondition for any revision of minimum wages." The Court emphasized that the Division Bench’s order dated 13.04.2020 did not waive this requirement; on the contrary, it explicitly required compliance with the Act’s procedures.

"The expression 'in accordance with the provisions of the said Act, 1948' occurring in paragraph (iii) of the operative portion and the expression 'after following the procedure under sub-section (1) of Section 5.' support such interpretation."

The Court rejected the State’s reliance on the 09.02.2021 order in W.P. No.9268/2020, noting that it merely directed consideration of a representation, not waiver of statutory procedure. The Court also found that the 17.01.2023 notifications were based on the inoperative 31.10.2019 notification, which had been declared void by the Division Bench. The downward revision of wages, without any compelling justification, was deemed arbitrary and violative of the principle of fair wage.

On the issue of repeal, the Court held that Section 69 of the Code on Wages, 2019 and Section 6 of the General Clauses Act, 1897 operate harmoniously. While Section 69(2) ensures continuity of actions taken under the repealed Act, Section 6(3) preserves accrued rights and liabilities, including pending legal proceedings. The Court concluded:

"The rights and liabilities accrued under the order upholding the validity of the notifications dated 30.12.2017, are saved. At the same time the Government’s right to revise the wages fixed under notifications dated 30.12.2017, reiterated in the same order is also saved. Both these savings are under Sections 6(c) and (e) of the Act, 1897."

Thus, the petitions remained maintainable. The Court further held that the right to interest on unpaid wages, as upheld in the Division Bench’s order, was an accrued liability and survived repeal. The Court also recognized the equitable need to award interest on unpaid wage differences for the garment industry, where no final revision had occurred since 2014.

The Verdict

The petitioner succeeded in part. The Court quashed the four impugned notifications dated 17.01.2023. The workers are entitled to wages fixed under the notifications dated 30.12.2017 for the period from 30.12.2017 until a new notification is issued. They are also entitled to 6% interest per annum on unpaid wages from the due date until actual payment. For the garment industry, the Government must complete a fresh wage revision pursuant to the draft notification dated 22.02.2018 within six months of this order. If the revised wages are higher than the 2014 rates, interest at 6% p.a. shall be payable on the unpaid difference from the date the wages became due. Any excess payment made under future notifications shall be adjusted as advance wages. No order as to costs.

What This Means For Similar Cases

Procedural Compliance Is Non-Negotiable

• Practitioners must insist on strict adherence to Section 5(1)(b) of the Minimum Wages Act, 1948 - publication of a proposal in the Official Gazette - before any wage revision, even if consultations have occurred.
• Failure to publish a proposal renders the revision void, regardless of stakeholder meetings or administrative convenience.
• Courts will not substitute their judgment for the Government’s, but will intervene where statutory procedure is ignored.

Accrued Rights Survive Statutory Repeal

• Even after the repeal of the Minimum Wages Act, 1948, rights to unpaid wages and interest accrued under valid notifications survive under Section 6 of the General Clauses Act, 1897.
• Legal proceedings initiated under the repealed Act remain maintainable if they seek enforcement of accrued liabilities.
• Employers cannot evade liability by arguing that the parent statute has been repealed; the Code on Wages, 2019 preserves past obligations.

Interest on Unpaid Wages Is a Legal Right

• Interest at 6% p.a. on unpaid minimum wages is not discretionary but a judicially recognized remedy for delayed payment.

• This applies even in the absence of a specific prayer, if the facts establish non-payment of legally due wages.

• The interest accrues from the date wages became payable, not from the date of litigation.

• Practitioners should routinely claim interest in wage disputes, even if not explicitly pleaded, as courts may grant it under equitable principles.

• Employers must maintain accurate wage records and ensure timely payment to avoid liability for interest.

• The judgment reinforces that wage revision must be transparent, procedurally sound, and non-discriminatory - particularly in industries dominated by women and marginalized workers.