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The Economic System of Islam5 min readViewed 2 times

5.10 The Basis upon which the Assessment of the Wage is Established


Hiring is a contract over a benefit in return for a recompense. The first condition for the validity of the contract of hiring is the legal competence of the two contractors, such that each of them has reached the age of maturity. Another condition for its validity is the consent of the two contractors. Moreover the wage should be known, due to the saying of the Prophet (pbuh): “If anyone of you hires a worker, He has to inform Him of his wage”, narrated by Ad-Daraqutni from Ibn Mas’oud. Also due to the Hadith narrated by Ahmed from Aby Sa’id that the Prophet (pbuh) forbade hiring a worker without explaining to Him his wage. However, if the wage was not defined, the hiring would be contracted and valid (legal). In case of dispute over the wage, reference is made to the equivalent wage. So if the wage was not defined at the time of the contract and if the employer and the employee then dispute over the wage, then the equivalent wage is adopted. The equivalent wage is adopted by analogy with the disputed marriage money (Dowry), which is decided by referring it to the equivalent dowry if it was not mentioned before, or if a dispute over the named amount occurred. This is due to what Ahmed narrated that ‘Abdullah ibn Mas’oud (ra) judged in the case of a man who passed away before sleeping with a woman, whom He had married without naming the dowry. He said: “She deserves the dowry of her equivalent woman, and she has to do the Iddah (waiting period for the next marriage) and she deserves to inherit from him.” Ma’qal ibn Sinan Al-Ashja’i said: “The Prophet (pbuh) has judged to Barwa’a, daughter of Washiq one of our people, as you judged.” The meaning of saying that she deserved the dowry of her equivalent women means a dowry identical to the dowry of equivalent women. So Shar’a obliged giving the equivalent dowry to the one whose dowry was not named. The same judgement is given in the case where a dispute occurs over the named dowry. Since the dowry is a recompense in the marriage contract, then recompense of any contract can be measured with it. Thus it is judged by the equivalent recompense in case the recompense was not mentioned in a contract, or in the case of dispute over the named recompense. Therefore, it is judged by the equivalent wage in the hiring, and by the equivalent price in the trading (selling) in the case where the price was not named in the contract, or there was a dispute over the named price. Therefore the equivalent wage resolves the case in a dispute between the employee and the employer over the named wage, and in the case where the wage was not mentioned. So, if the wage was mentioned in the contract then the wage would be the named one. But if it was not mentioned or if a dispute occurred over the named wage, then the equivalent wage would be judged as the wage. Thus, the wage is of two different kinds: A named wage and the equivalent wage. The condition for considering the named wage is its acceptance by the two contractors. So if the two contractors accepted a certain wage, then this wage will be the named one, and the employer would not be obliged to pay more than it, nor would the employee be obliged to take less than it, rather it is the binding legal wage. The equivalent wage is the wage for equivalent work, or of the equivalent worker if the contract of the hiring had been concluded over the benefit of the work. The equivalent wage would be the wage of the equivalent worker only if the hiring contract was stated over the benefit of the hired person.

Those who are considered to estimate the wage are the experts in defining wages, not the State, nor the traditions of the population. Rather they are the experts on the wage for the relevant type of work, or the wage for the type of workers for whom the wage is intended to be estimated.

The basis upon which the experts estimate the wage is the benefit, whether it was for the work or the worker. Because the hiring contract is based on the benefit, it becomes the basis upon which the wage estimation is built. Thus the wage is not estimated by the production of the worker or by the lowest standard of living among his community. There is no consideration to the production of the worker nor to the high standard of living in its estimation, rather its estimation is related to the benefit. The experts estimate the wage of the worker according to the value of this benefit in the society in which they live. When the experts estimate the wage for the work and the wage of the worker, they consider the value of the benefit in the community, so they estimate it by the value of the benefit produced by the worker, or benefit of the work. If a dispute occurred over the estimation of the benefit in the community, then it should not be estimated by evidence and proof. Rather it is enough to take the opinion of the experts, because the question is to estimate the value of the benefit and not to establish an evidence about its amount.

Thus, the basis upon which the estimation of the wage is built is the benefit according to the estimation of the experts. But when the experts estimate the equivalent wage, they have to consider not only the wage of the work or the worker alone, because the wage varies with the work, worker, time and place. Rather they are obliged to look to the person who is identical to the worker doing the same work, which is to look to the work, the worker, and at the same time, they have to look at the time and place of work, because the wage differs with the work, worker, the time and the place.

The contracting parties, that is the employer and employee, originally select the experts who estimate the wage or the equivalent wage. If they did not select the experts or differed over their selection, then the court or the State is the competent authority to appoint these experts.

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Chapters (110)
  1. 11 Introduction to the Economic system
  2. 21.1 The Capitalist Economic System
  3. 31.2 The Economic System versus Economic Science
  4. 41.3 The Socialist Economic System
  5. 52 Economy
  6. 62.1 The Basis of the Economic System
  7. 72.2 The View of Islam towards the Economy
  8. 82.3 Economic Policy in Islam
  9. 92.4 The General Economic Principles
  10. 103 Types of Ownership
  11. 113.1 Private Ownership
  12. 123.2 Definition of Private Ownership
  13. 133.3 The Meaning of Ownership
  14. 143.4 The Means of Owning Property
  15. 154 The First Means of Ownership - Work
  16. 164.1 Cultivation of Barren Land
  17. 174.2 Extracting that which exists inside the earth
  18. 184.3 Hunting
  19. 194.5 Mudharaba
  20. 204.6 Share Cropping - Musaqat
  21. 214.7 Hiring-Employing an Employee
  22. 225 The Work Of The Employee Worker
  23. 235.1 Definition of the Work
  24. 245.2 The Type of Work
  25. 255.3 Duration of the Work
  26. 265.4 Wage for Work
  27. 275.5 The Effort Spent in the Work
  28. 285.6 The Ruling Regarding Hiring Over Prohibited Benefits
  29. 295.7 The Ruling of Hiring Non-Muslims
  30. 305.8 Hiring Someone to perform Worships and Public Services
  31. 315.9 Who is the Employee?
  32. 325.10 The Basis upon which the Assessment of the Wage is Established
  33. 335.11 Estimating the Employee's Wage
  34. 346 The Second Means Of Ownership
  35. 356.1 Inheritance
  36. 367 The Third Means of Ownership
  37. 377.1 The need for Property for Sustenance
  38. 388 The Fourth Means Of Ownership
  39. 398.1 That which the State gives of its Properties to the Citizens
  40. 409 The Fifth Means Of Ownership
  41. 419.1 The Property obtained by Individuals
  42. 4210 The Way To Dispose Of Property
  43. 4310.1 Right of Disposal
  44. 4410.2 Increasing Property
  45. 4510.3 The Rules of Lands
  46. 4610.4 Cultivation of Barren Land
  47. 4710.5 Disposal of Land
  48. 4810.6 Preventing the Leasing of Land
  49. 4911 Trading And Manufacturing
  50. 5011.1 Trade
  51. 5111.2 Manufacturing
  52. 5212 The Laws Of Partnership Companies
  53. 5312.1 The Company in Islam - Partnership
  54. 5412.2 The Company of Equal - Al-Inan
  55. 5512.3 The Companies of Bodies - Al-Abdan
  56. 5612.4 The Company of Body and Capital - Mudharaba
  57. 5712.5 The Company of Reputation Faces - Wujooh
  58. 5812.6 Company of Negotiation - Mufawadha
  59. 5912.7 Dissolving the Company
  60. 6013 Capitalist Companies
  61. 6113.1 Commercial Company of Joint Liability
  62. 6213.2 Joint-Stock Company - Share Companies
  63. 6313.3 Shares of the Share Stock Company
  64. 6413.4 Co-operative Societies
  65. 6513.5 Insurance Ta’meen
  66. 6614 The Prohibited Methods of Increasing Ownership
  67. 6714.1 Gambling
  68. 6814.2 InterestUsury (Riba)
  69. 6914.3 Criminal Fraud
  70. 7014.4 Deceit in Trade
  71. 7114.5 Monopoly
  72. 7214.6 Price-Fixing
  73. 7315 Right of Disposal to Spend in Gifts and Maintenance
  74. 7416 Public Property (AlMilkiyyah Al- Ammah)
  75. 7517 State Property
  76. 7618 Nationalised Property is neither Public nor State Property
  77. 7719 Seclusion (Hima) in the Public Interests
  78. 7820 Factories
  79. 7921 Bait ul Mal (The State Treasury)
  80. 8021.1 Revenues of Bait ul-Mal
  81. 8121.2 The Expenditures of Bait ul-Mal
  82. 8221.3 The State Budget
  83. 8321.4 Zakat
  84. 8421.5 The Head Tax (Jizya)
  85. 8521.6 The Land Tax (Kharaj)
  86. 8622 Distributing Wealth among the People
  87. 8722.1 Economic Equilibrium in Society
  88. 8822.2 The Prohibition of Hoarding Gold and Silver
  89. 8923 Riba and Currency Exchange (Sarf)
  90. 9023.1 Riba (Interes-tUsury)
  91. 9123.2 Currency Exchange (Sarf)
  92. 9223.3 Exchange Transactions
  93. 9324 Money-Currencies (An-Nuqood)
  94. 9424.1 The Gold Standard
  95. 9524.2 Benefits of the Gold Standard
  96. 9624.3 Problems facing the Gold Standard
  97. 9724.4 The Silver Standard
  98. 9824.5 Metallic Money
  99. 9924.6 Paper Money
  100. 10024.7 Issuing of Currency
  101. 10124.8 Exchange Rate of Currencies
  102. 10225 Foreign Trade
  103. 10325.1 The Reality of Foreign Trade
  104. 10425.2 Balance of Tarde
  105. 10525.3 Currency-Monetary Relations Between Countries
  106. 10625.4 Foreign Trade Policy
  107. 10725.5 Free Trade
  108. 10825.6 Protectionism
  109. 10925.7 National Economy
  110. 11025.8 Policy of Self-Sufficiency