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Iran, Islamic Republic of - Minimum Wages - 2011


LAST UPDATE

12 August 2011

SOURCES


Name of Act

Labour Code. Dated 20 November 1990. Rouznameh Rasmi, 17 February 1991, No. 13387, pp. 114.
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Other source used

Iran Labor Report ’New Minimum Wage Rate Spurs Widespread Indignation’ published 16 March 2010, accessed 8 August 2011, at http://iranlaborreport.com/?p=327

Other source used

Mardomak ’Council announced that the minimum wage of workers with 9 percent next year, USD 330 thousand and 300 is determined’ published http://www.mardomak.org/story/61035 on Tuesday 24 Esfund 1389 (Persian date), accessed 8 August 2011.

Other source used

Hansjörg Herr and Milka Kazandziska ’Principles of Minimum Wage Policy - Economics, Institutions and Recommendations’ Working Paper No. 11, International Labour Organization and Global Labour University, March 2011

LEGAL DEFINITIONS


Employee/worker

’Worker’ means any person who works in any capacity at the request of an employer in return for remuneration.
Labour Code 1990 §2
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Employer

’Employer’ means any legal or natural person at whose request and for whom a worker performs work in return for remuneration.

Directors, managers and, generally, any person entrusted with the duty of running a workplace shall be regarded as the employer’s representatives; and the employer shall be responsible for carrying out all obligations to the workers undertaken by such representatives.

Where an employer’s representative takes any initiative which is outside the scope of his duties and which is not acceptable to the employer, such representative shall be responsible to the employer.
Labour Code 1990 §3

Wage

The term ’wage’ includes all cash payments in kind or non-pecuniary allowances, or combination thereof, that are paid to a worker in return for the performance of work.

The term ’remuneration’ includes wages, salaries, dividends and other allowances.
Labour Code 1990 §§2, 35
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Minimum wage

The fixed wage consists of the sum of the wage for a job and of the fixed benefits paid for that job.

Social benefits and incentives, such as housing allowances, benefits in kind, family allowances, production increase bonuses and shares of annual profits are not considered part of the fixed wage and basic wage.
Labour Code 1990 §36

MINIMUM WAGE FIXING


Procedure

The Supreme Labour Council shall be responsible every year for fixing minimum wages for the various regions of the country according to the sectors of industry.
Labour Code 1990 §41

Procedure in general

The Supreme Labour Council shall be responsible every year for fixing minimum wages for the various regions of the country according to the sectors of industry.

The minimum wage determination is supplemented by a job classification and assessment scheme, drawn up and implemented by the Ministry of Labour and Social Affairs in order to prevent exploitation of a person’s labour. The scheme shall be based on the occupational standards and common practice of the country.

Employers covered by the Labor Code are then required to draw up a job classification scheme in cooperation with the workplace’s job classification committee or other appropriate bodies, and subject to the approval of the Ministry of Labour and Social Affairs. The scheme is intended to establish an appropriate relationship between each workplace and the labour market with respect to wages, and to clarify the description of duties and responsibilities of the various occupations at each workplace.

The Ministry of Labour and Social Affairs shall draw up and publish instructions and regulations for implementation regarding job classification schemes applicable to workers and the date of entry into effect of such schemes and shall determine the authority and qualifications of individuals and bodies involved in the drawing up of the job classification scheme.

In workplaces where a job classification scheme is applied, the wage for a given category and step shall constitute the basic wage.

In workplaces which do not apply a job classification and assessment scheme, fixed allowances paid for a job are benefits that are paid because of the nature of work or work environment, or as a wage adjustment during ordinary working time, such as supplements for arduous work, benefits for supervision, job allowance, etc.
Labour Code 1990 §§36 (Notes), 48, 49
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Government decides after tripartite or bipartite body discussions/recommendations

The minimum wage rate is determined by the Supreme Labour Council, which shall be constituted as follows:
(a) the Minister of Labour and Social Affairs, as the Chairman of the Council;
(b) two persons experienced in social and economic matters, to be proposed by the Minister of Labour and Social Affairs and approved by the Council of Ministers. One of the said two persons shall be appointed from among the members of the Supreme Council for Industry;
(c) three employers’ representatives (including one from the agricultural sector), to be elected by the employers;
(d) three workers’ representatives (including one from the agricultural
sector), to be elected by the High Centre of the Islamic Labour Councils.

With the exception of the Minister of Labour and Social Affairs, the members of the Supreme Labour Council thus composed shall be appointed or elected for a renewable term of two years.

The Supreme Labour Council shall have a permanent secretariat, consisting of labour, economic, social and technical experts who shall carry out studies on labour relations and working conditions, and prepare such other information as may be required for the purposes of the Supreme Labour Council. The Chief of the Secretariat shall be appointed on the proposal of the Minister of Labour and Social Affairs, subject to approval by the Supreme Labour Council, and shall attend the Council sessions without a voting right.

The directives and instructions concerning procedures for convening and running the Supreme Labour Council, the functions of the Secretariat of the Council, and the procedure for electing the principal and substitute workers’ and employers’ representatives to the Council shall be prescribed in regulations drawn up by the Minister of Labour and Social Affairs and approved by the Council of Ministers.
Labour Code 1990 Chapter X
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Criteria

The Supreme Labour Council is to fix the minimum wages in accordance with certain criteria enumerated in the Labour Code 1990.
Labour Code 1990 §41

Needs of workers and their families

The minimum wage is aimed to be fixed at a level which meets the living expenses of a family of four, regardless of the physical and intellectual abilities of workers and the characteristics of the work assigned.
Labour Code 1990 §41(2)
Principles of Minimum Wage Policy - Economics, Institutions and Recommendations p8

Inflation rate

The minimum wage of workers shall be fixed taking account of the rate of inflation announced by the Central Bank of the Islamic Republic of Iran.
Labour Code 1990 §41(1)

Coverage

The minimum wage provisions of the Labor Code apply to all workers, employers and their representatives, trainees, apprentices and workplaces.
Labour Code 1990 §5

Scope

The minimum wage provisions of the Labor Code apply to all workers, employers and their representatives, trainees, apprentices and workplaces.
Labour Code 1990 §5
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Excluded categories

Any person subject to the Civil Service Act or to other special laws and regulations, and any worker in family workplaces where work is performed exclusively by the employer, his wife and his blood relatives in the first degree, are not subject to the provisions of this Code.
Labour Code 1990 §188
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» Workers

Workers in family workplaces where work is performed exclusively by the employer, his wife and his blood relatives in the first degree, are not subject to the provisions of the Labor Code 1990.
Labour Code 1990 §188

» Sectors

Workers in the civil service sector who are covered by the Civil Service Act are not covered by the Labor Code 1990.
Labour Code 1990 §188

Level

The minimum wage was set at USD 303.48 per month in March 2010.
Iran Labor Report March 2010

Minimum wage level(s) in national currency

303.48 US dollars per month
Iran Labor Report March 2010
Mardomak minimum wage article 2011
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Last minimum wage update

March 2010
Iran Labor Report March 2010
Mardomak minimum wage article 2011
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In-kind allowances

The minimum wage referred to in section 41 of the Labour Code shall be paid exclusively in cash. Such payments in kind as may be provided for in employment contracts shall be in addition to the minimum wage.

Where part of the wage is paid in kind by mutual consent, the equivalent in cash of such payments shall be equitable and reasonable.
Labour Code 1990 §§40, 42

Rate of payment

Wages shall be paid at regular intervals, during working hours.
Labour Code 1990 §37

» Hourly

Where wages are paid on a daily or hourly basis, by contract, custom or workplace practice, each payment shall be calculated and effected at the end of the day, week or fortnight according to the number of hours or days worked.
Labour Code 1990 §37(a)

» Daily

Where wages are paid on a daily or hourly basis, by contract, custom or workplace practice, each payment shall be calculated and effected at the end of the day, week or fortnight according to the number of hours or days worked.
Labour Code 1990 §37(a)

» Weekly

Where wages are paid on a daily or hourly basis, by contract, custom or workplace practice, each payment shall be calculated and effected at the end of the day, week or fortnight according to the number of hours or days worked.
Labour Code 1990 §37(a)

» Monthly

Where wages are paid monthly by contract, custom, or workplace practice, payment shall take place at the end of each month. In this case the wage shall be called a salary.
Labour Code 1990 §37(b)
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» Other

Where wages are paid on a daily or hourly basis, by contract, custom or workplace practice, each payment shall be calculated and effected at the end of the day, week or fortnight according to the number of hours or days worked.
Labour Code 1990 §37(a)

Scheduled frequency of adjustment

The minimum wage is reportedly revised annually, in the last week of March each year. However, no relevant statutory provisions have been identified.
Principles of Minimum Wage Policy - Economics, Institutions and Recommendations p9
Mardomak minimum wage article 2011

Enforcement mechanisms

Any failure to fulfil the obligations prescribed in this Code shall be punished by imprisonment or a fine or both. Amounts due on account of fair remuneration for work completed (or any other claims) and/or damages shall be paid by the legal person which committed the crime. However, the managing director or the responsible manager of the legal person under whose orders the offence was committed shall incur criminal liability and be subject to imprisonment or a fine, or to both these penalties.
Labour Code 1990 §§171, 184

Labour inspection

Although the Department of Labour Inspection is stated as having been established for the purposes of the application of the Labor Code, the labour inspection provisions of the Labor Code appear primarily concerned with ensuring the observance of the rules concerning occupational health and safety standards (see Chapter IV, Division II of the Labor Code 1990).

Issues of compliance with wage-related obligations may be better dealt with under the dispute settlement provisions in Chapter IX. These provisions require workers with a dispute concerning the application of this Code or other labour regulations to seek settlement by compromise and, if not reached, approach the Board of Inquiry or the Disputes Board for examination and settlement of the issue.

Disputes arising from the implementation of a job classification scheme may be referred to the Disputes Board, subject to the agreement of the Ministry of Labour and Social Affairs.
Labour Code 1990 §§49 (Note 3), 96-106, 157-166

Fines in national currency for non-respect of legislation

Any person who commits an offence under sections 38, 45 or 59 or under the Note in section 41 shall, be subject to the following fines in respect of each worker:
(1) for up to ten workers, 50 to 70 times the minimum daily wage of a worker;
(2) for up to 100 workers, in excess of the first ten, 50 to 100 times the minimum daily wage of a worker;
(3) for more than 100 workers, in respect of the number in excess of 100, two to five times the minimum daily wage of a worker.

Employers who fail to draw up and apply a job classification scheme in accordance with §49 of the Labor Code 1990 shall pay a fine equivalent to 50 per cent of the consultancy fee, to be deposited in the public income account of the public treasury.
Labour Code 1990 §§50, 174

Other penalties

Any person who commits an offence under sections 38, 45 or 59 or under the Note in section 41 shall, in respect of each offence and as the case may be, remedy the offence or pay any amounts due to the worker, or both, within such timelimit as may be set by the court in consultation with the representative of the Ministry of Labour and Social Affairs.

Employers who fail to draw up and apply a job classification scheme in accordance with §49 of the Labor Code 1990 shall be liable for the expenses of drawing up the classification by a technical consulting bureau (in accordance with §50) and shall also pay the wage difference resulting from the implementation of the job classification scheme.
Labour Code 1990 §§50, 174
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Results generated on: 18th April 2014 at 05:14:13.
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