Understanding Basic Salary and Dearness Allowance: How Are They Allocated?

TANYA BAJAJ
Hello all,
I need to understand on what basis we allocate the basic salary and dearness allowance. Please explain once.

Regards,
Tanya
Sharp payroll
Basic salary is 50% of the per month gross salary, and DA is 50% of the Basic salary.
rdsyadav
Dear Friends and CiteHR,

It's in our benefit to make a long-term study plan to understand the basics and fundamentals in various HR/IR courses. It may not be possible to stay in the field and perform consistently without self-help. It's true, like the law of nature we observe in real life. Furthermore, to rise high and grow professionally successful, agile, and confident in HR/ER by practicing in a shortcut method is a process but not advisable.

Please read on the neutralization of dearness due to price hikes. The concept is that employees are receiving wages/salaries at certain constant rates and assumptions. The price hike on certain minimum consumption of items like rice, flour, potato, onion, etc., does not allow meeting the daily needs of family members. You will find the Consumer Price Index, a factor that has been analyzed to approximate the price hike city-wise. HR professionals must conduct a careful study and keep abreast of this model and also about ILOs, which cover basic and elementary needs, genesis, and the process of discipline that has allowed the growth of labor legislations - a way to resolve grievances in India.

CiteHR has a plan to host this type of event for the benefit of HR practitioners. It is requested to organize an orientation program for our colleagues to learn the prevailing practices across the country and around the globe.

Regards,
RDS Yadav
Management Advisor and Trainer
Director, Future Institute of Management Technology
gopinath varahamurthi
As stated by Shri Rdsyadav, the basic salary is the mean amount required to sustain the business and livelihood. Dearness allowance is the result of enhancing performance and adjusting to the consumer price index with an appropriate value. Other allowances, such as House Rent Allowance (HRA), travel allowance, and additional pay contributions, aim to excel in the provided service/work and motivate employees for better performance. Therefore, the basic salary is the compensation given to employees for their performance, enabling them to sustain their livelihood while carrying out their duties. This fundamental amount serves as an introduction to the work environment.
TANYA BAJAJ
Dear all,

Suppose the company is paying Rs. 10,000 as Gross Salary. Then the calculation will go as follows:

ESI CONTRIBUTION (Both for employer and employee) = Rs 650 (475 + 175) Basic Salary (50% of Gross Salary) = Rs 5000 D.A (50% of Basic Salary) = Rs 2500 Travelling Allowance = Rs 1850. All of these add up to a total of Rs 10,000.

Am I right???

Regards, Tanya
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