A company has shifted its office from Delhi to Noida. In Delhi, minimum wages are high compared to Noida. Can company reduce the basic salary component in the Salary as per Noida (UP) minimum wages? Though overall salary will be same.
Thanks in advance
From India , Bangalore
Thanks in advance
From India , Bangalore
Dear Rekha,
When the appropriate Government under the Minimum Wages Act,1948 which fixes the minimum wages is a State Government for any employment, relatively it is bound to vary from the rates of other States.. Therefore, when an industry shifts its location to some other State where the rates of minimum wages are comparatively less or transfer some of its employees to such a State, it cannot unilaterally reduce the existing higher rates of wages on par with the lower rates fixed by the latter State without the consent of the employees concerned under a bilateral settlement or without issuing a 21 day notice u/s 9-A of the Industrial Disputes Act,1947.
Though overall or gross salary remains the same, certainly when the basic is less, it will have cyclical impact on indirect benefits like bonus, gratuity, contribution to EPF etc.
From India, Salem
6018When the appropriate Government under the Minimum Wages Act,1948 which fixes the minimum wages is a State Government for any employment, relatively it is bound to vary from the rates of other States.. Therefore, when an industry shifts its location to some other State where the rates of minimum wages are comparatively less or transfer some of its employees to such a State, it cannot unilaterally reduce the existing higher rates of wages on par with the lower rates fixed by the latter State without the consent of the employees concerned under a bilateral settlement or without issuing a 21 day notice u/s 9-A of the Industrial Disputes Act,1947.
Though overall or gross salary remains the same, certainly when the basic is less, it will have cyclical impact on indirect benefits like bonus, gratuity, contribution to EPF etc.
From India, Salem
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