Hi Mahib,
Most companies fix the Gross Salary, and 40 to 50% of it will be the Basic salary to reduce PF/ESI/Bonus/Gratuity liability. In your case, the Basic salary, which was $6,500 earlier, was revised to $15,000.
Please let us know:
1. What was your Gross Salary earlier?
2. What is your Gross Salary after the revision (i.e., when your Basic was revised from $6,500 to $15,000)?
This information may help us understand the motive behind revising the Basic to more than double the earlier amount. Is it to avoid PF/ESI, etc.? Please provide a breakdown of deductions to understand the calculation of take-home pay and how the increase in Basic has resulted in a reduction of take-home pay.
Email: c.neyimkhan@gmail.com
Kindly provide the requested details for further analysis.
Thank you.
From India, Bangalore
Acknowledge(0)
Amend(0)
38Most companies fix the Gross Salary, and 40 to 50% of it will be the Basic salary to reduce PF/ESI/Bonus/Gratuity liability. In your case, the Basic salary, which was $6,500 earlier, was revised to $15,000.
Please let us know:
1. What was your Gross Salary earlier?
2. What is your Gross Salary after the revision (i.e., when your Basic was revised from $6,500 to $15,000)?
This information may help us understand the motive behind revising the Basic to more than double the earlier amount. Is it to avoid PF/ESI, etc.? Please provide a breakdown of deductions to understand the calculation of take-home pay and how the increase in Basic has resulted in a reduction of take-home pay.
Email: c.neyimkhan@gmail.com
Kindly provide the requested details for further analysis.
Thank you.
From India, Bangalore
Acknowledge(0)Amend(0)
There may be rare chances of such a case, as told by Mr. Sovik. If the Basic is contributing 99% of the Gross Salary after revision and the other component contributes 1%, there are chances where the Net Take-Home salary can be lower than Basic. However, an appropriate view can be given only after looking at the comparison of the current and previous salary structure. It would be wrong to give vague answers in general.
From India, Ahmadabad
Acknowledge(0)Amend(0)
From India, Ahmadabad
Acknowledge(0)Amend(0)
Payment of Wages Act specifies that the total deduction from gross wages cannot exceed 50% of gross salary. So, for the in-hand to go down beyond that, the basic must be more than 50% of gross. However, the OP clarified that his basic was 6500, and now it's 15000, but his take-home has come down from 13000 to 12500. This is definitely not right. It appears that the management is trying to restructure the salary to avoid PF or is deducting increased PF, including employer's contribution, from employees' gross salary. Both of which are illegal.
I cannot think of any circumstance in which with an increase in basic pay the gross will reduce. It appears to be a case of pure manipulation. However, as you rightly pointed out, the OP does not seem to be interested in sharing his payslip (before and after the salary restructuring), so we are only doing an academic exercise to improve our knowledge.
From India, Mumbai
Acknowledge(0)Amend(0)
I cannot think of any circumstance in which with an increase in basic pay the gross will reduce. It appears to be a case of pure manipulation. However, as you rightly pointed out, the OP does not seem to be interested in sharing his payslip (before and after the salary restructuring), so we are only doing an academic exercise to improve our knowledge.
From India, Mumbai
Acknowledge(0)Amend(0)
Dear,
Due to the increase in wages beyond 10,000, the query is beyond the scope of the Payment of Wages Act under section 1(6). Even under section 7, deductions of up to 75 percent can be made. There does not appear to be any other law governing the impermissibility of payment of wages below the basic pay, except in cases of attachment by the court under the Code of Civil Procedure (CPC).
From India, New Delhi
Acknowledge(0)Amend(0)
Due to the increase in wages beyond 10,000, the query is beyond the scope of the Payment of Wages Act under section 1(6). Even under section 7, deductions of up to 75 percent can be made. There does not appear to be any other law governing the impermissibility of payment of wages below the basic pay, except in cases of attachment by the court under the Code of Civil Procedure (CPC).
From India, New Delhi
Acknowledge(0)Amend(0)Looking for something specific? - Join & Be Part Of Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.