Hi
The minimum wages can be bifurcated in two components, first being the basic pay and other is dearness allowance so called as DA.
The Government in every six months revises the DA component of the minimum wages. If any of you have seen the Government Order (G.O.) of minimum wages issued by the State Labour department, you'll see these two components applicability upto a definite time period.
Please refer to the attachment, which has a minimum wages GO applicability upto 30th September 2007, where you will see Basic Pay in Serial No. 3 and Dearness Allowance in Sr. No. 5. You need to follow the same while making the salary. The basic pay of an employee can be more than the minimum basic pay as mentioned in the GO but it cannot be less than that of. In the same you can pay more DA to your employee but the DA figure cannot be less than which is mentioned in the GO.
Thus, the minimum has two components basic pay and dearness allowance. Contribution of PF and ESIC is both applicable on basic pay and dearness allowance.
I hope it's clear to you Sunita.
warm regards,
Umesh Chaudhary
(welcomeumesh@yahoo.com)