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krishna@kk
Dear All,
Can Employer reduce Gross Salary of a working employee. As like ESIC limit increase up to 21K in this scenario if employee already taking 16K as Gross and now he comes under ESIC, should Gross will affected ??
2. Is there any law related that Employee can not reduce the Gross salary to maintain the CTC.
3.Like if a contractor workimng for principle employer and principle employer does not want to increase the CTC whether Min wage hike is there of ESIC new limit is there, what a contractor do.

From India, New Delhi
umakanthan53
6016

Dear Krishna,

Really, I am at a loss to understand your question most probably because of the way it is drafted.

The effect of any hike announced in the existing ceiling of wages/salary by way of a statutory amendment for the purpose of extending the coverage of employees under a particular Labour Enactment would be the application of the Act to more no of employees.

In effect, (a) there can not be any reduction in the Net salary of the employees already covered (b) the employees hither too not covered but brought under the scheme of the Act because of the enhancement of the salary ceiling will receive less net salary to the extent of their contribution (c) in any case there can not be reduction in their gross salary and (d) the CTC in respect of the newly covered employees would certainly raise because of the employer's contribution. Therefore, where is the question of the employer reducing the gross salary on this score? Had you meant reduction in the salary so as to avoid application of the Act like ESIC or EPF, it is not possible for no employee would accept such a reduction in the existing salary. Furthermore, CTC is just an accounting aid to calculate the overall financial commitment of the employer to retain the individual employee on the job. It has no statutory force or flavour.

"NO" is the answer for your last question. Every Statutory hike applicable to the wages, both direct and indirect, of the contract labour has to be included in the charges payable to the contractor by the principal employer.

From India, Salem
manojkamble
377

Dear Krishna,
Answers for your queries are as below :
1. Employer is not suppose to deduct any amount from gross, CTC will increase and there is no other choice for the same. Yes, employee may be affected in their net salary.
2. Yes, as per wages act you can not decrease an gross salary of the employee just to meet any statutory requirements.
3. Every statutory amendment is applicable to all establishments falls under it's purview. Eventhough it's principle employer or contractor the rules are same and to be applied accordingly.


Rupali Divatankar
Dear Sir,
If Hr Manager on notice period and no new manager is appointed till now , So as an Hr What all need to take hand over from the Manager to continue with Hr work without distrubing system.
Thanks

From India, Bhiwandi
manojkamble
377

Dear Rupali,
You need to take all statutory work handover which may or may not been shared with anybody by your HR Manager. As in HR Statutory violation may result in penalty in terms of money and punishment as well. Rest of the things can be still managed.


Bharat Gera
223

1. Irrespective of any situation employer can not reduce salary of an employee who falls under the category of workmen under section 2(s) of the Industrial Disputes Act.
2. Law does not recognize concept of CTC. It is a commercial concept adopted by the companies to cheat the employees showing them a bigger package.
3. Reduction in monthly gross salary will impact statutory deductions which is an offence punishable with fine and/or imprisonment under various labour laws like ESI Act, EPF Act, Payment of gratuity Act etc.

From India, Thane
krishna@kk
@Bharat Gera Sir: Thank you for your reply. Can you share any notification where is it mentioned that decrease gross may lead to fine or imprisonment.
2. For example an emplyees gross was 17k at Dec 2016 now in Jan 2017 ESIC raise its limit upto 21K. Now ESIC deduction is mendotry.
In this scenario what will happen to gross salary.

From India, New Delhi
Bharat Gera
223

Please study payment of Wages Act. This Act allows certain deductions from the employees salary. EPF Act, Payment of Gratuity Act and Rules made there under you need to study. Further there are court judgement also.
From India, Thane
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