Dear All
I had faced 7A Enquiry in my earlier organization. The main focus was upon salary structure. Enforcement Officer reported that our Basic was very low and allowances were more. Hence he added all allowances excluding current Basic and HRA and restricted to Rs.6500 and arrived dues for 25.61%. He suggested us to change the salary structure, We revised our salary structure like 60% Basic, 30% HRA 10% other allowance. Even then PF Commissioner and Enforcement Officer suggested to increase the Basic from 60% to 80%, rest 20% shall be other allowance.
My question is IS THERE ANY RULE MENTIONED IN EPF Act that Basic Wages should be 50% or 60% or 80% ? Please confirm me on immediate basis, since iam going to implement new structure in my new company.
My id is
, 
Thanks in Advance
With Regards
M.Karthik
From India, Madras
4I had faced 7A Enquiry in my earlier organization. The main focus was upon salary structure. Enforcement Officer reported that our Basic was very low and allowances were more. Hence he added all allowances excluding current Basic and HRA and restricted to Rs.6500 and arrived dues for 25.61%. He suggested us to change the salary structure, We revised our salary structure like 60% Basic, 30% HRA 10% other allowance. Even then PF Commissioner and Enforcement Officer suggested to increase the Basic from 60% to 80%, rest 20% shall be other allowance.
My question is IS THERE ANY RULE MENTIONED IN EPF Act that Basic Wages should be 50% or 60% or 80% ? Please confirm me on immediate basis, since iam going to implement new structure in my new company.
My id is
Thanks in Advance
With Regards
M.Karthik
From India, Madras
Dear Mr. Karthik,
There is no such rule.
Since from your posting I cannot make out the kind of organisation of yours.
You simply need to ensure that the basic is not less than the minimum wages.
If the inspector ask for something ask them to show where it is written.
From India, Mumbai
There is no such rule.
Since from your posting I cannot make out the kind of organisation of yours.
You simply need to ensure that the basic is not less than the minimum wages.
If the inspector ask for something ask them to show where it is written.
From India, Mumbai
The P.F Act does not prescribe any minimum limit for basic and allowances and it is entirely employer's discretion as to how to structure the salary of it's employees.
B.Saikumar
HR & Labour Law Advsior
Mumbai
From India, Mumbai
B.Saikumar
HR & Labour Law Advsior
Mumbai
From India, Mumbai
Dear Karthick,
There is no minimum wages structure only for PF, you have to comply with the minimum wages applicable to your establishment as per the Minimum wages Act. When you comply with the Act this question does not arise.
NPB
From India, Coimbatore
There is no minimum wages structure only for PF, you have to comply with the minimum wages applicable to your establishment as per the Minimum wages Act. When you comply with the Act this question does not arise.
NPB
From India, Coimbatore
We need to ensure that the basic & the DA is as per minimum wages notified by the respective state govts every year for each industry. The rest is left to the employer to structure the salaries.
From India, Bangalore
From India, Bangalore
Dear,
in Punjab the minimum basic has fixed by the govt. w.e.f. 17.02.2012, the govt has given a notification that "the minimum rates of wages shall be the basic rates of wages". it means that there is no any rule to keep the basic 60%/50% of salary. this is your own decision but should be or above minimum wage.
regards
satish
From India, Chandigarh
in Punjab the minimum basic has fixed by the govt. w.e.f. 17.02.2012, the govt has given a notification that "the minimum rates of wages shall be the basic rates of wages". it means that there is no any rule to keep the basic 60%/50% of salary. this is your own decision but should be or above minimum wage.
regards
satish
From India, Chandigarh
If you are paying the salary above the the minimum wages, then it is not illegal if you are not paying the Basic Salary and D.A. / special allowance as per the minimum wages. This is held in the judgement of the Honourable Supreme Court in the case of Airfreight Ltd. v/s. State of Karnataka. Kindly refer the below link.
Airfreight Ltd. vs State Of Karnataka & Ors. on 4 August, 1999
Regards,
Kuldeep Singh
From India, Vijayawada
Airfreight Ltd. vs State Of Karnataka & Ors. on 4 August, 1999
Regards,
Kuldeep Singh
From India, Vijayawada
Dear All,
There is no any rules stating that you should calculate PF in basic or allowances, Pf should be calculated on gross excluding HRA and washing allowance up to my knowledge.
If i am wrong please update me on the same.
Regards,
Ajay Krishnan
Junior Executive
9940065144
From India, Chandigarh
There is no any rules stating that you should calculate PF in basic or allowances, Pf should be calculated on gross excluding HRA and washing allowance up to my knowledge.
If i am wrong please update me on the same.
Regards,
Ajay Krishnan
Junior Executive
9940065144
From India, Chandigarh
Basic Salary should not be less than the minimum wages notified by t5he government . If basis is more than minimum wages then Management are free to fix Basis salary and Allowance. However it should be applied equally for all employees.
From India, Delhi
From India, Delhi
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