Hello All... can we reduce the basic pay of an employee mid-way during the year?
If yes, how.. as in the formalities to be conducted?
If NO
1. Under which act, section, clause of the act...
2. How does it impact the individual, company, statutory compliances
Pls mail me at
Thanks & Cheers
K
From India, Madras
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3If yes, how.. as in the formalities to be conducted?
If NO
1. Under which act, section, clause of the act...
2. How does it impact the individual, company, statutory compliances
Pls mail me at
Thanks & Cheers
K
From India, Madras
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dear
you can not reduced some one basic not mid way or end way.it is not given in any act.
but u can co relate with PF act as it is mentioned in PF act that u can not reduce PF contribution of any person and if u will reduce basic than PF contribution will
also reduce.
ethically also we have never heard that any organisation reduced basic.
tks
j s malik
From India, Delhi
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you can not reduced some one basic not mid way or end way.it is not given in any act.
but u can co relate with PF act as it is mentioned in PF act that u can not reduce PF contribution of any person and if u will reduce basic than PF contribution will
also reduce.
ethically also we have never heard that any organisation reduced basic.
tks
j s malik
From India, Delhi
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dear pls refer section 12 of the P F act.
karnatka high cout has given judgement in RPFC Banglore vsHarihar polyfibres in 1991
AN EMPLOYER CAN NOT REDUCE WAGES OF THE EMPLOYEEFOR THE PURPOSE OF PAYMENT OF CONTRIBUTION UNDER THE ACT.
tks
j s malik
From India, Delhi
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karnatka high cout has given judgement in RPFC Banglore vsHarihar polyfibres in 1991
AN EMPLOYER CAN NOT REDUCE WAGES OF THE EMPLOYEEFOR THE PURPOSE OF PAYMENT OF CONTRIBUTION UNDER THE ACT.
tks
j s malik
From India, Delhi
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as others have rightly mentioned, ensure not to alter any of the salary components which has a direct impact on the statutory contributions.
particularly, PF is one such compenent that s always under guard for labor dept.
also there is nothing like the changes have cannot be done in the mid of the year. usually people implement new things in the begining of the year to ensure that tracking and documentaion is kept simple at the time of filing.
From India, Bangalore
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particularly, PF is one such compenent that s always under guard for labor dept.
also there is nothing like the changes have cannot be done in the mid of the year. usually people implement new things in the begining of the year to ensure that tracking and documentaion is kept simple at the time of filing.
From India, Bangalore
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Hi, Basic pay once paid cannot be reduced as most of the perks & benefits/allowances are paid on the basis of basic pay viz. PF, ESI, LTC, medical reim., gratuity etc. rgds, Jyoti Negi
From India, Delhi
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From India, Delhi
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Dear,
Basic pay can not be reduced, it will be a voilation of sec. 12 of EPF & MP Act - 1952.
It will impact an individual that on reduction in his basic pay , other perks and allownces will be reduced if linked with basic. similarly on reducing basic pay PF contribution will be reduced EL Encashment, Gratuity, etc. are also reduced.
It is not seen that a company reduced the basic pay rather hold increment.
Thanks
Mohd. Arif Khan
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Basic pay can not be reduced, it will be a voilation of sec. 12 of EPF & MP Act - 1952.
It will impact an individual that on reduction in his basic pay , other perks and allownces will be reduced if linked with basic. similarly on reducing basic pay PF contribution will be reduced EL Encashment, Gratuity, etc. are also reduced.
It is not seen that a company reduced the basic pay rather hold increment.
Thanks
Mohd. Arif Khan
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Dear All,
Reduction of Basic pay is possible as a measure of disciplinary action against an employee, provided a provision to this effect is there in service rules by which the employee is governed. In other words, this will be like a penalty which can be inflicted after giving him adequeate opportunity of defending him or her and following the procedure for imposing such a penalty. But, I am not sure, in Private Sector this procedure of giving adequeate opportunity of defence is being followed or not. However, arbitrary action of such kind may invite legal implications.
regards
Deepak Mathur
From India, New Delhi
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Reduction of Basic pay is possible as a measure of disciplinary action against an employee, provided a provision to this effect is there in service rules by which the employee is governed. In other words, this will be like a penalty which can be inflicted after giving him adequeate opportunity of defending him or her and following the procedure for imposing such a penalty. But, I am not sure, in Private Sector this procedure of giving adequeate opportunity of defence is being followed or not. However, arbitrary action of such kind may invite legal implications.
regards
Deepak Mathur
From India, New Delhi
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Dear all,
I am working in a private diagnostic center as a nurse. Reduction of basic pay is possible at the time of yearly increment because I am worried about my PF; everything depends on the basic pay. So please help me out.
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I am working in a private diagnostic center as a nurse. Reduction of basic pay is possible at the time of yearly increment because I am worried about my PF; everything depends on the basic pay. So please help me out.
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Strategically, logically, and legally, no. You cannot reduce the basic because all the payments are connected to basic. You can only do that at the time of an increment; you can reduce the basic wage and add the amount in allowances. The Government of India is planning to fix the basic wage for all positions at 70%, but it is not yet finalized, and no Government Order (GO) or Gazette publication has been released. This is part of addressing all the issues related to the split in minimum wages and bringing commonality across.
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From India, Hyderabad
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From India, Hyderabad
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Basic Pay for EPF Contribution-re duction not permissible.doc x
Clubbing of allowances with basic pay under PF Act.pdf