sureshjakhotiya
10

Dear All
PF contribution is 12% on Basic+DA.
We pay lot of allowances also e.g. HRA,Medical,Attendance ,Telephone ,conveyance etc & while doing so ,take compliance of Minimum Wages in account.
Is there any provision or law that binds an employer that the allowances can not be more than a %age of total salary?? else employer may pay maximum allowances & small Basic +DA to escape liabilities under PF,BONUS,GRATUITY Acts etc.
Regards
Suresh

From India, Nagpur
Jayendra Chaturvedi
2

Yes Suresh, Their is a law that 40 %of total ctc should be basic+merged da Thnaks and regards Jayendra Chaturvedi
From India, Gurgaon
vishwa2
3

Dear Jayendra,
It would helpful if you can provide such ceilings with specific reference to Act/Rules.
Aside to Suresh: Lower basic may attract your attention of PF inspector. It is not advised to go too low.
Rgds
Vishwanath

From India, Bangalore
Srinivas Neeragantapalli
2

Dear Suresh,
There is no any law as such, however I understand that some inspecting staff insisting that Basic +DA should be at 50% of the Gross salary.
To my knowledge PF authorities only should clarify this.
Regards,
Srinivas

From Germany
vishwa2
3

Dear Srinivas
You re right. We have experienced difficulty in this respect.
The inspection team has directed us to pay PF on other allowances since Basic is less than 50%.
We are forced to change the structure.
rgds
Vishwanath

From India, Bangalore
Jayendra Chaturvedi
2

Dear Vishwa/Suresh,
You cannot cross the lower ceiling limit (40 % Basic ) ,in any salary structure it is a guideline,which is a parameter base for pf proceedings.
Thnaks an dregards
Jayendra Chaturvedi

From India, Gurgaon
s.anitha
2

Hi all,
As per the inspection done in our organization,
the inspector told me that if Basic+ DA is less then 6500/- then it will attract special allowance, food allowance etc as wages.
HRA and Conveyance are excluded.
Regards,
Anita

From India, Bangalore
sureshjakhotiya
10

Dear All
This query needs a specific answer.We all experience the same type of difficulty & PF dept just directs its way
Neither the employee nor the employer is benefited as per the Social Security guide lines & money keeps lying with the dept.
Request Seniors to Guide
Regards
Suresh

From India, Nagpur
vishwa2
3

Anita and Suresh,
You are right. I am told that there is High court order favouring Department. Since I dont have copy of the same, I dont wish to comment further.
If any one has more info, request them to share.
Rgds
Vishwanath

From India, Bangalore
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