Difference between “Fair Wage”, “Living Wage” and “Actual Wage”
A fair wage is thus related to the earing capacity and work load. It should not be lower than the minimum wage in any case.
So lower limit being the minimum wage, the upper limit would be set by what may broadly be called the capacity of industry to pay (i.e. living wage) depending not only on its present economic position but also on its future prospects.
2. Living Wage:
It is a wage which is sufficient to provide not only the essentials mentioned above but a fair measure of frugal comfort with an ability to provide for old age and evil days. Concept of living wage is NOT a static concept as it widens with the growth & development Living Wage should enable male wage earner to provide for himself and his family not only the basic essentials of food, clothing and shelter, but a measure of frugal comfort including education for children, protection against ill health, requirements of essential social needs, and a measure of insurance against the misfortunes, including old age
3. Actual Wage:
Between these two limits of minimum and living wage i.e. capacity of industry to pay, the actual wage will depend on a consideration of the following factors:
(a) The productivity of labour.
(b) The prevailing rates of wages in the same or similar occupations in the same or neighboring localities.
(c) The level of national income and its distribution.
(d) The place of the industry in the economy of the country.