Is It Compulsory To Pay "Food Allowance", "Canteen Allownance" For Factory Workers

Hi,
I am stuck with a problem. I want to understand are there any specific heads which are compulsory under which salary/wages are paid under Factories Act.
In other words, I need to understand is it compulsory to have a heading "Food Allowance", "Canteen Allownance" in the payslip of a factory?

It is not compulsory under the Act You need to provide a Canteeen if you have more than 250 workmen You are supposed to provide food at subsidised rate
Sivasankaran

We do not have 250 workmen. We do not have a canteen but we have provided a place for them to have food.
We have Food Allowance and Canteen Allowance as part of our salary, which reflects in payslips as well as wages register. One PF inspector has visited the factory and informed us that food/canteen allowance is part of basic salary under PF act and we need to pay PF contribution on this amount. Which I checked in Bare Act, and it's correct.
We may cahnge the name of the allowance in future, but wanted to understand, if under Factories Act or any other act, is it compulsory to pay the allowances.
Thanks.
Gopinath
9822976398

Yes, he is right All such allowances are covered under PF and ESI Changing it is not going to solve your problem. At the most you cn make it part of HRA
Why two allowances... Food allow and canteen allow. I do not understand the logic
T Sivasankaran

Hi Siva,
We have workers whom we pay Canteen Allowance. We have staff members whom we pay Food Allowance. We are thinking of changing the name of these allowances and making them Misc. Allowance. But that will be a future step. Before that I wanted to understand are there any specific allowances we need to pay under factories act.
Now i am clear that there are no specific headings/allowances under factories act. I will speak to our consultant as well and take a call.
I am thanksful for your guidence.
Gopinath

Hi Siva,
I also wanted to understand are there any specific allowances we need to pay under factories act.
regards with,
Rushi Joshi
Jr.HR Exe.
Ahemdabad

hi sir i girija i want to know that complete for mat of of monthly salary calculation/monthly salary structure.

Hi,
Normally monthly salary has following headings -
Earnings -
Basic
HRA
Conveyance
Education Allowance
Special Allowance/ Misc Allowance
Deductions -
PF
PT
I Tax
The % of earnings depends on every company's stratige.

No, there is no provision to pay food allowance or arrange for subsidized rates in canteen. What is required by law id to arrange for canteen if the number of employees cross 250. The rates may be decided by the Works Committee formed under I.D.Act. Allowances etc are decided under agreements with the Union and not by legal provisions

Dear Friends,
My counter parts have clearly mentioned that no act will insist on the Management to pay food allowance or canteen allowance. As per the Factories Act Sec. 46 the State Govt. may make rules requiring that in any specified factory wherein more than 250 workmen are ordinarily employed(confirmed+staff+contract+staff+ trainees/Probationers+security+canteen workers all put together a canteen shall be provided and maintained by the occupier for the use of workers.
Most of the management, where less than 250 workers are there, during the course of wage settlement, split the basket amount into various heads for cost effectiveness and to avoid contributions on PF and payment of Gratuity. This is upto the Management and Union to sit and sort out these issues during the course of negotiations.
G.K.Manjunath
Sr.Manager HR