dear seniors,
i have a doubt regarding minimizing basic in minimum wages?
to make it clear take an example of a office assistant, as per the minimum wages act
his basic -3700/-
d.a - 538/-
total - 4237/-
my query is can i restructure it as
basic - 50% of 4237/- : 2119
d.a remains the same : 538
and the other amount as allowance :1580 in total - 4237/-
can i do this? i have discussed it before , some say it can be possible , as we are to maintaining 50% of gross, some say it is illegal, some talk of judgement by supreme court given in the case of gujarat cypromet ltd vs asst p.f commissioner 2004iii clr 485.
i just want to do a favour to the low level employees by reducing their contribution in pf deductions and making it more as take home, actually they are not even interested in having p.f.
a simple reason they say is i may not able to solve my present problems, how could u say preserve for future.
so please jelp me out so i can do something out
From India, Visakhapatnam
i have a doubt regarding minimizing basic in minimum wages?
to make it clear take an example of a office assistant, as per the minimum wages act
his basic -3700/-
d.a - 538/-
total - 4237/-
my query is can i restructure it as
basic - 50% of 4237/- : 2119
d.a remains the same : 538
and the other amount as allowance :1580 in total - 4237/-
can i do this? i have discussed it before , some say it can be possible , as we are to maintaining 50% of gross, some say it is illegal, some talk of judgement by supreme court given in the case of gujarat cypromet ltd vs asst p.f commissioner 2004iii clr 485.
i just want to do a favour to the low level employees by reducing their contribution in pf deductions and making it more as take home, actually they are not even interested in having p.f.
a simple reason they say is i may not able to solve my present problems, how could u say preserve for future.
so please jelp me out so i can do something out
From India, Visakhapatnam
dear raj
legally u can not do anything.you please refer section 12 of EPF and MP act 1952,where it is clearly mentioned that u can not recduce the wages for PF point of view.this was discussed in forum earlier also.
tks
j s malik
From India, Delhi
167legally u can not do anything.you please refer section 12 of EPF and MP act 1952,where it is clearly mentioned that u can not recduce the wages for PF point of view.this was discussed in forum earlier also.
tks
j s malik
From India, Delhi
In minimum wage case you cannot bifurcate the salary in various salary components. It should remain the same. However, where gross salary is more than 6500/-, you can but it should not be less than 50% of gross. This is confirmed by the Asstt.PF commissioner, enforcement.
Regards,
From India, Mumbai
Regards,
From India, Mumbai
Dear Raj,
In reply to y9ur query, I would like to share with you that in case of workman, the minimum wages are to reckoned as basic wages and the PF needs to be deducted on the same. It needs to be done to avoid any legal hassles in smooth functioning of the organisation. In case, you are looking foreard to make it 50% of gross salary that means in that case it will come out to be less than the prescribed minimum wages for that category of workman. In the coming days, these workmen can take advantage of this policy of yours and may ask for the same benefits under minimum wages act.
i have faced the similar situation last year due to reluctance to pay by the management, as the employees have lodged a complaint with the PF commissioner under RTI Act and we had to pay arrears to the tune of Lakhs of rupees and are unable to recover the same from the workmen.
It is advisable to pay minimum wages as basic wages and PF should be deducted on the minimum wages so as to safeguard the interest of management and workmen in the long run.
Thanks
Amit Anand Gera
From India, New Delhi
In reply to y9ur query, I would like to share with you that in case of workman, the minimum wages are to reckoned as basic wages and the PF needs to be deducted on the same. It needs to be done to avoid any legal hassles in smooth functioning of the organisation. In case, you are looking foreard to make it 50% of gross salary that means in that case it will come out to be less than the prescribed minimum wages for that category of workman. In the coming days, these workmen can take advantage of this policy of yours and may ask for the same benefits under minimum wages act.
i have faced the similar situation last year due to reluctance to pay by the management, as the employees have lodged a complaint with the PF commissioner under RTI Act and we had to pay arrears to the tune of Lakhs of rupees and are unable to recover the same from the workmen.
It is advisable to pay minimum wages as basic wages and PF should be deducted on the minimum wages so as to safeguard the interest of management and workmen in the long run.
Thanks
Amit Anand Gera
From India, New Delhi
DEAR RAJ ONE U,
I HAVE GONE THROUGH THE DISCUSSIONS, AND THIS TYPE OF MATTER HAS ALREADY DISCUSSED EARLIER. MR.MALLIK JS AND MR.AMIT KR.GERA ARE QUITE RIGHT ON THE SUBJECT.
DO NOT BIFURCATE MINIMUM WAGES IN MANY PARTS YOU CAN DIVIDE IT IN ONLY TWO PARTS BASIC + DEARNESS ALLOWANCE. P.F.HAS TO BE DEDUCTED ON BOTH THE SALARY HEADS AND IT IS APPLICABLE & ACCEPTABLE FOR GRATUITY AND AS WELL AS FOR MINIMUM WAGES.
IN MY OPINION DON'T DIVIDE MINIMUM WAGES IN PARTS, OVER THE MINIMUM WAGES YOU CAN DIVIDE THE SALARY & WAGES TO HEAD OF YOUR CHOICE.
SHISH:lol:
From India, New Delhi
I HAVE GONE THROUGH THE DISCUSSIONS, AND THIS TYPE OF MATTER HAS ALREADY DISCUSSED EARLIER. MR.MALLIK JS AND MR.AMIT KR.GERA ARE QUITE RIGHT ON THE SUBJECT.
DO NOT BIFURCATE MINIMUM WAGES IN MANY PARTS YOU CAN DIVIDE IT IN ONLY TWO PARTS BASIC + DEARNESS ALLOWANCE. P.F.HAS TO BE DEDUCTED ON BOTH THE SALARY HEADS AND IT IS APPLICABLE & ACCEPTABLE FOR GRATUITY AND AS WELL AS FOR MINIMUM WAGES.
IN MY OPINION DON'T DIVIDE MINIMUM WAGES IN PARTS, OVER THE MINIMUM WAGES YOU CAN DIVIDE THE SALARY & WAGES TO HEAD OF YOUR CHOICE.
SHISH:lol:
From India, New Delhi
Dear Raj, There is supreame court judgement that if you are paying more than minimum wages then you may bifurcate minimum wages in different heads but basic should be 60%. Thanks & Regds Arun Gupta
From India, Delhi
From India, Delhi
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Minimum wages- Basic.pdf