Overview of the Equal Remuneration Act, 1976
The Equal Remuneration Act, 1976 mandates that employers pay equal remuneration to men and women workers for the same work or work of a similar nature. The Act also prohibits discrimination against women in recruitment and service conditions. It is a cornerstone of gender pay parity legislation in India, giving effect to Article 39(d) of the Constitution which directs the State to ensure equal pay for equal work for both men and women.
The Act applies to all establishments, whether in the public or private sector, and covers all workers including those employed through contractors. “Same work or work of a similar nature” means work in respect of which the skill, effort, and responsibility required are the same, even if performed under different conditions or in different locations.
With the enactment of the Code on Wages, 2019 (yet to be notified in many states), the provisions of the Equal Remuneration Act are expected to be subsumed. However, until the Code is fully implemented, the 1976 Act remains in force and compliance is mandatory.
Key Provisions
Equal Pay for Equal Work (Section 4)
No employer shall pay to any worker remuneration at rates less favourable than those at which remuneration is paid to workers of the opposite sex for performing the same work or work of a similar nature.
No Discrimination in Recruitment (Section 5)
No employer shall make any discrimination against women while recruiting for the same work or work of a similar nature, or in any condition of service subsequent to recruitment (promotions, training, transfers).
Advisory Committee (Section 6)
The appropriate government can constitute Advisory Committees with not less than 10 members (including women) to provide advice on increasing employment opportunities for women.
No Reduction in Wages (Section 4(2))
To comply with the Act, employers cannot reduce the wages of any worker. Pay parity must be achieved by raising the lower wages, not by reducing the higher ones.
What Constitutes “Same Work or Similar Nature”?
The Act defines this as work where the skill, effort, and responsibility required are the same, even if performed under different designations or at different locations. Courts have interpreted this broadly to include work that is substantially similar even if not identical.
Equal Pay Applies When:
- • Same skill level and qualifications required
- • Similar physical or mental effort involved
- • Comparable level of responsibility
- • Similar working conditions (even if at different sites)
Permissible Pay Differences:
- • Different seniority or experience levels
- • Different qualifications for different roles
- • Performance-based pay differences (applied equally)
- • Special hazard or night-shift allowances applied neutrally
Penalties for Non-Compliance
- • Paying unequal wages: Fine of ₹10,000 to ₹20,000 and/or imprisonment up to 3 months (first offence)
- • Discrimination in recruitment: Fine of ₹10,000 to ₹20,000 and/or imprisonment up to 3 months
- • Non-maintenance of records: Fine up to ₹10,000
- • Repeat offence: Higher penalties including imprisonment up to 6 months and fine up to ₹20,000
- • Recovery: The authority can direct payment of wage differential to the aggrieved worker
Employer Compliance Checklist
- ✓ Conduct a pay equity audit comparing compensation of men and women in similar roles
- ✓ Ensure job descriptions and pay scales are gender-neutral
- ✓ Maintain register of workers with wage details (inspectable by authorities)
- ✓ Display abstract of the Act at a conspicuous place in the establishment
- ✓ Implement a non-discrimination policy covering hiring, promotions, and compensation
- ✓ Ensure recruitment advertisements do not discriminate by gender (unless work is prohibited for women by law)
- ✓ Train HR staff on equal pay requirements
Code on Wages, 2019—Future Changes
The Code on Wages, 2019 subsumes the Equal Remuneration Act along with three other wage-related legislations. When fully notified, it will strengthen equal pay protections by:
- • Explicitly prohibiting gender-based pay discrimination
- • Covering all employees regardless of wage level
- • Introducing a statutory floor wage set by the Central Government
- • Increasing penalties for violations
Until the Code is notified and rules framed by all states, the Equal Remuneration Act, 1976 remains the governing law.