Establishment : In Maharashtra Type : Hotel Resort Question : Is it mandatory to deduct food from salary as per law Burning issue : Net in hand reduces for the employee
From India, Mumbai
Acknowledge(0)
Amend(0)

I don't know whether hotels, restaurants, or any such kind of eateries are covered by the State Shops and Establishments Act or by any special State Law in the State of Maharashtra. But, in Tamil Nadu, we have a separate enactment entitled "The Tamil Nadu Catering Establishments Act, 1958" for the regulation of conditions of work in catering establishments. Under this Act, the term "wages" include, inter alia, food allowance or the cash equivalent of the meals and tiffin supplied to the employees free of charge. The value of free food is determined by the State Government from time to time under rule 35 of the Rules under the Act, which ranges from Rs. 2.50 to 2.75 per day depending upon the place of the establishment like Dt or taluk headquarters, town panchayats, etc. (I am not aware of revision, if any as of now). If an employer chooses to pay instead of free food, he can do so. Otherwise, deduction of food allowance, which is relatively very meagre, will not affect the employee's net earnings.
From India, Salem
Acknowledge(0)
Amend(0)

Please refer to relevant minimum wages applicable to the hotel industry regarding the provision of food deduction under the Karnataka Minimum Wages Act. In the Karnataka Minimum Wages applicable for the hotel industry, there is a provision for the deduction of 15% of the lowest minimum wages applicable to the zone if food is provided during working hours.
From India, New Delhi
Acknowledge(0)
Amend(0)

VR Wealth Advisors

To advise properly, the purpose of the question is required. In Maharashtra, all the hotels/restaurants are covered under the Bombay/Maharashtra Shops & Establishments Act.

So far, as I understand, you are asking the question regarding PF/ESI/Bonus. Please disclose the purpose.

Warm Regards, Bharat Gera HR Consultant 9322404765

From India, Thane
Acknowledge(0)
Amend(0)

Dear Friend,

Your question "Is it mandatory to deduct the cost of food from the salary otherwise? No, this does not fall under statutory law like EPF, etc.

When you work out the salary, it's better to:
a) Calculate the cost if food is provided. (Cost should be worked out)
- If the employee does not want to take the provided food, what would be the option?
- If the employee wants to take the food, what would be the occasional cost?

b) What accommodation would be provided to the employee in case they have to stay at a hotel?

For these questions:
1) Provide free food and prepare meals for the employees in the industry. In small industries, this is easy, and for big hotels/resorts, let them organize it to avoid food wastage by bringing everything under one umbrella.
2) If the salary heads are worked out, have a ration head/food & beverages/ and a fixed monthly amount so that providing food to the employee may not be necessary.
3) In industries, you can also provide a subsidy for food up to a certain extent, where you can deduct from the salary and compensate for the full bill from the organizational account.

All these fall under the category of Salary and Allowances in the hotel industry. Hospitality is the main category, so don't expect a concrete worksheet. You need to work with the financial department to provide cost-free food and adhere to industry standards.

Considering the issue will not affect the Net Pay, as you are making decisions separate from the income. Food Allowance is entirely different from the salary to the employee.

Furthermore, not all industrial work is equal, so you can address and resolve the issue accordingly.

Thank you.

From India, Arcot
Acknowledge(0)
Amend(0)

Mr. Umakanthan,

I read your post on the Hotel Industry in Tamil Nadu. Rule 35 specifies Rs 2.75. I am not very clear about the term Cash Equivalent. Does this mean that an Employer can deduct Rs 2.75 from wages per day if they supply food?

Thanks,
T. Sivasankaran

From India, Chennai
Acknowledge(0)
Amend(0)

Dear Mr. Sivasankaran,

As per Section 2(13-A) of the TN Catering Establishments Act, 1958, "wages" means the cash equivalent of the meals and tiffin supplied to the employees free of charge, apart from the basic wages, dearness allowance, etc., mentioned therein.

Moreover, G.O. (2D) No. 35, Labor and Employment (JI) dated 08-07-2014 of the Govt. of Tamil Nadu fixing minimum wages for employment in Hotels and Restaurants clearly mentions in its Note (2) as follows: "Where free food and tiffin are not supplied to the employees, the employees shall be paid, besides wages specified herein, cash equivalent of food and tiffin @ Rs. 46.90 per day for the total number of days worked in the month."

Reading the provision of Sec. 2(13-A) conjunctively with the above, it implies that the supply of free food to employees is a statutory obligation, and the absence of such practice obligates the employer to pay the food allowance as it forms part of the wages payable. The observation of the Division Bench of the honorable Madras High Court in its judgment upholding the inclusion of the food allowance in the computation of gratuity in N. Sivadasan Vs. Appellate Authority under the Payment of Gratuity Act, 1972 [1997(1) LLJ Page 1155] also strengthens the above viewpoint.

Coming to your question on the import of Rule 35 of the TNCE Rules, 1959, I wish to correct the portion of my previous reply regarding recovery and state that "the cash equivalent" mentioned therein is for the purpose of payment in lieu of free food and for the calculation of leave and terminal benefits.

My sincere thanks to you for having given me the opportunity to correct my previous reply.

From India, Salem
Acknowledge(0)
Amend(0)

Engage with peers to discuss and resolve work and business challenges collaboratively - share and document your knowledge. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Join & Be Part Of Our Community.





Contact Us Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2025 CiteHR ®

All Copyright And Trademarks in Posts Held By Respective Owners.