Variable Dearness Allowance revised from Oct 1: Check new minimum wages for construction, agriculture and other workers

Workers in several sectors covered by the Centre’s minimum-wage framework will receive higher minimum wages from 1 October 2026 after the Labour Bureau revised the Variable Dearness Allowance (VDA) linked to inflation.

The Labour Bureau, under the Ministry of Labour and Employment, issued the revised VDA order on 30 September. The revision is based on the average Consumer Price Index for Industrial Workers (CPI-IW), which rose to 431.42 as of 30 June 2026 from 424.80. This represents an increase of 6.62 points. The revised VDA is effective from 1 October 2026.

The revised rates apply to workers in employment categories for which minimum wages are fixed by the central government. These include agriculture, construction and maintenance, loading and unloading, sweeping and cleaning, watch and ward duties and certain mining activities. The order has been issued under Section 69(2) of the Code on Wages, 2019.

Construction workers: minimum wage rises to ₹840 a day for unskilled workers in Area A

For construction and maintenance work, the revised minimum wage depends on the worker’s skill category and whether the workplace falls in Area A, B or C.

The rates comprise the basic minimum wage and the revised VDA. For example, an unskilled construction worker in Area A has a basic wage of ₹523 and VDA of ₹317, taking the total minimum wage to ₹840 a day. For a highly skilled worker in the same area, the basic wage is ₹693 and VDA is ₹418, taking the total to ₹1,111 a day.

The construction category covers work involving roads, runways and buildings, as well as laying underground electric, telephone and other communication cables, water-supply lines and sewerage pipelines.

Area classification matters because the same category of worker can have different minimum wages depending on the location. The order uses the existing classification of cities into Areas A, B and C.

Agriculture workers: revised minimum wage starts at ₹486 a day

Agricultural workers will also see higher minimum wages from 1 October.

For an unskilled agricultural worker, the revised daily minimum wage is ₹537 in Area A, ₹491 in Area B and ₹486 in Area C. For highly skilled workers, the corresponding rates are ₹705, ₹655 and ₹587 a day.

The agriculture rates similarly combine the basic wage with VDA. The revised VDA for unskilled agricultural workers is ₹204 a day in Area A, ₹188 in Area B and ₹186 in Area C.

Other workers also get revised rates

The October revision covers several other categories. For example, workers in watch and ward duties without arms will receive a minimum of ₹1,024 a day in Area A, ₹933 in Area B and ₹794 in Area C. For workers performing watch and ward duties with arms, the corresponding rates are ₹1,111, ₹1,024 and ₹933.

The Centre has also revised minimum wages for workers involved in loading and unloading at railway goods sheds, warehouses, docks, ports and airports, as well as sweeping and cleaning work.

What is VDA and why is it revised?

Variable Dearness Allowance is the inflation-linked component of minimum wages. The Centre revises it every six months based on changes in the Consumer Price Index for Industrial Workers. The Labour Ministry has previously explained that the VDA mechanism is intended to protect minimum wages from the impact of inflation.

For the October 2026 revision, the Labour Bureau said the CPI-IW increased by 6.62 points. The VDA has been rounded up to the next higher rupee, according to the order.

These are central-sphere minimum wages, not a universal minimum salary applicable to every worker in India. Workers whose employment falls under state-government minimum-wage notifications may be governed by the rates notified by their respective states.