The company where I am working as HR belongs to General Engineering sector, I have this query:

Is DA applicable to employees of Private Limited Companies, as I was told it is not mandatory? Please clarify.

Thanks, Human Resources

From India, Trivandrum
Labour Law & Hr Consultant
Management Consultancy
+1 Other


Separate accounting for DA is not mandatory so long as notified Minimum Wages are paid to the employees.
From India, Mumbai

When an employment is brought under the Schedule of the Minimum Wages Act, 1948 by the Appropriate Government, the initially devised and periodically revised structure of the minimum rates of wages invariably comprises of the components of a fixed basic and a variable dearness allowance linked to some cost of living index or other which is normally on an ascending trend. Such a trend results in periodical rise of the statutory minimum wages and compels a constant parity between the statutory minimum wages and the industry wages with or without the component of D.A and the failure of which would lead to contravention of non-payment of minimum wages under section 12 resulting in claim u/s 20 of the MW Act, 1948 involving at times the heavy penalty of 10 times of the difference in addition to payment of the wages actually due as per the minimum rates of wages.

Hence, inclusion of the component of variable D.A into the industry wage structure is highly recommendatory though not mandatory.

From India, Salem

In case of fair wages which is much more than the minimum wages under the circumstances cost of living components can be withdrawn Regards Ranjan Dixit
From India, New Delhi

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