As a general rule percentage of allowances are calculated from Basic.
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28th June 2013 From India
28th June 2013 From India, Chennai
On Basic, Scale of the pay should be determined after taking into consideration the nature of the work done, capacity of the industry to pay and other similar factors; whether employer is able to make profit or not has no bearing on the question of proper wages of a workman.
To determine the proper basic wages of a workman a comparison with the rates obtaining in similar business of the locality is useful.
28th June 2013 From India, Ahmadabad