Interpretation of ordinary rate of wages under the Factories Act

The definition of ordinary rate of wages under Section 59(2) of the Factories Act, 1948 explicitly encompasses basic wages along with various allowances to which a worker is entitled, excluding only bonus and wages for overtime work. This statutory phrasing leaves no room for administrative curtailment. When a statute specifically enumerates exclusions like bonus and overtime wages, it follows that any other exclusions must also be expressly provided by the legislature rather than introduced through executive fiat. The literal interpretation of the text ensures that employees receive compensation that truly reflects their actual wage structure during standard working hours. This provision acts as a vital statutory baseline to protect the economic interests of workers in manufacturing units. The term allowances as used in the enactment is broad and comprehensive enough to include compensatory payments like house rent and transport allowances. Courts must adhere to the plain meaning of such beneficial provisions without reading limitations into them that were never intended by the law-makers. Any attempt to artificially narrow down the scope of ordinary rate of wages defeats the protective object of the legislation. The judicial approach requires upholding the literal mandate when the words of the provision are clear, unambiguous, and entirely free from doubt. (Union of India & Others v. Heavy Vehicles Factory Employees' Union and Another | 2026 INSC 74)