Pl find the attached regarding not split the minimum wages for reducing of PF contribution is offence as per attached file. Review once this most usefull for all HR folks. Regards Satya
From India, Bangalore
2From India, Bangalore
Dear Satya, This is very important circular which you have posted. I am extremely grateful to you for your valuable posting. With Regards, K.RAVISHANKAR
From India, Madras
From India, Madras
Is this applicable only for those who are splitting wages below the minimum wage or for many establishments who pay much higher than the minimum wage... Which means is it legal if an org pays a high basic, and then splits it under different headings, and still ensure that Basic is above rs 6500/-
From India
From India
Dear Indra Priyadharshini Minimum wages varies between industries and the status of the employer Kindly tell me the industry and what level of labour is appointed Cheerz
From India, Bangalore
From India, Bangalore
Dear Satya,
Many thanks for your circular.
What we are doing in our factory is that we pay Rs. 150 as basic to employee and Rs. 25 /day as HRA to entry level workmen as Rs. 175 is minimum wage.
We used to deduct PF only on Rs. 150 where as ESIC we used to pay for both basic and HRA.
Your circular indicates that we should pay PF also for Rs. 150+25. Is this so?
I think many senior HR consultants here in Gujrat are also not aware of it.
This we are doing for last one year and so it raises our liability. Can you please inform whether we can now contribute for earlier missed pf contribution ?
Best regards,
SHD
From India, Surat
Many thanks for your circular.
What we are doing in our factory is that we pay Rs. 150 as basic to employee and Rs. 25 /day as HRA to entry level workmen as Rs. 175 is minimum wage.
We used to deduct PF only on Rs. 150 where as ESIC we used to pay for both basic and HRA.
Your circular indicates that we should pay PF also for Rs. 150+25. Is this so?
I think many senior HR consultants here in Gujrat are also not aware of it.
This we are doing for last one year and so it raises our liability. Can you please inform whether we can now contribute for earlier missed pf contribution ?
Best regards,
SHD
From India, Surat
Dear SHD,
Pls read the notification and try to understand what is meant by basic wages,min wages and wages for staturory duties.Also have an idea of allowances.Hra is and allowance and therefore is not a part of basic wage.While Basic wages are declared by state govt under the min wages act as per the work categories. Basic +DA is the statutory wage for other calculations like PF/BONUS etc.
Thanks
Bijay
From India, Vadodara
Pls read the notification and try to understand what is meant by basic wages,min wages and wages for staturory duties.Also have an idea of allowances.Hra is and allowance and therefore is not a part of basic wage.While Basic wages are declared by state govt under the min wages act as per the work categories. Basic +DA is the statutory wage for other calculations like PF/BONUS etc.
Thanks
Bijay
From India, Vadodara
Dear All, Our establishment taken exemption of PF under Basic + D. A. is more than Rs. 6500/-. Please clear me What is the latest ammendment said. SKT
From India, Nasik
From India, Nasik
Dear Pals.
The PF circular quoted talks about payment of contribution on less than minmum wages prescibed
by various states and notified to many industries. It appears that some companies have further split
this Minimum wages to bring down their liability which is certainly not the intention of law makers.
In such cases the ineterpretaion of " basic wages" should be construed as not less than the minimum
wages prescibed for various industries by the appropriate Govt.
If you are already covering / paying contribution equal to or more than minimum wages and paying HRA / Conveyance/ etc. as addition allowances, you need only to pay PF contribution on minimum wages
and not on other split allowances.
HC. Subbaramu
HR & Labour Law Consulatant
Vijayanagar, Bangalore.
From India, Kochi
The PF circular quoted talks about payment of contribution on less than minmum wages prescibed
by various states and notified to many industries. It appears that some companies have further split
this Minimum wages to bring down their liability which is certainly not the intention of law makers.
In such cases the ineterpretaion of " basic wages" should be construed as not less than the minimum
wages prescibed for various industries by the appropriate Govt.
If you are already covering / paying contribution equal to or more than minimum wages and paying HRA / Conveyance/ etc. as addition allowances, you need only to pay PF contribution on minimum wages
and not on other split allowances.
HC. Subbaramu
HR & Labour Law Consulatant
Vijayanagar, Bangalore.
From India, Kochi
Dear Subbaramu,
By definition, minimum wage is BASIC+DA + HRA. Now we used to deduct PF on Basic + DA and not on HRA.
But if pf is to be paid on minimum wage than we need to consider HRA contribution also under PF calculation.
Best regards,
SHD
From India, Surat
By definition, minimum wage is BASIC+DA + HRA. Now we used to deduct PF on Basic + DA and not on HRA.
But if pf is to be paid on minimum wage than we need to consider HRA contribution also under PF calculation.
Best regards,
SHD
From India, Surat
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