One of Public Ltd. Company working for the last 25 years has a salary structure comprising 95% basic of gross salary, 2.5% HRA, and 2.5% CCA of gross salary. However, due to the high basic salary, the company bears more liability such as PF & Gratuity. Is it permissible by law for the company to change its salary structure to reduce liability?
At the same time, employees of the company may also suffer a loss of PF contributions and receive a lower gratuity amount at the time of retirement. Can this type of practice be challenged in court?
From India , Ahmadabad
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2At the same time, employees of the company may also suffer a loss of PF contributions and receive a lower gratuity amount at the time of retirement. Can this type of practice be challenged in court?
From India , Ahmadabad
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Section 12 of EPF act may be attracted.
Section 12 in The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
1[12. Employer not to reduce wages, etc.—No employer in relation to 2[an establishment] to which any 3[Scheme or the Insurance Scheme] applies shall, by reason only of his liability for the payment of any contribution to 4[the Fund or the Insurance Fund] or any charges under this Act or the 3[Scheme or the Insurance Scheme], reduce, whether directly or indirectly, the wages of any employee to whom the 3[Scheme or the Insurance Scheme] applies or the total quantum of benefits in the nature of old age pension, gratuity 5[, provident fund or life insurance] to which the employee is entitled under the terms of his employment, express or implied.]
If you are a worker go to labour commissioner with the complaint
If you are not a worker only remedy here could be civil litigation.
From India, Pune
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Section 12 in The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
1[12. Employer not to reduce wages, etc.—No employer in relation to 2[an establishment] to which any 3[Scheme or the Insurance Scheme] applies shall, by reason only of his liability for the payment of any contribution to 4[the Fund or the Insurance Fund] or any charges under this Act or the 3[Scheme or the Insurance Scheme], reduce, whether directly or indirectly, the wages of any employee to whom the 3[Scheme or the Insurance Scheme] applies or the total quantum of benefits in the nature of old age pension, gratuity 5[, provident fund or life insurance] to which the employee is entitled under the terms of his employment, express or implied.]
If you are a worker go to labour commissioner with the complaint
If you are not a worker only remedy here could be civil litigation.
From India, Pune
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