As per the PF act, the contribution is payable only on basic wages.What consitutes basic wage is million dollar question.Various courts have given different interpretation like what are the earned componets while on duty or on leave is basic.Hence other than HRA is basic.Such basic wage accotrding to the act is restricted to Rs.6500. Another view is that, when their is contract of employment is prevail, what the employer and employee agrees as wages by bifrcution is basic. This is the well settled position by supreme court.However department is taking the corporates for ride by the Gujart High court decision and the industries should address the issue in the proper forum by litiation or representation.
The main affecting industries are shop act and contract workers.
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The main affecting industries are shop act and contract workers.
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