Can I Calculate PF on Payable Days with This Pharma Salary Structure? Seeking Advice

Respected Members,

I need help. Currently, I'm working in a manufacturing pharma company, and here the salary structure is as follows:

Salary Structure Details

Basic 60% - 7200 (as per government rule, the basic salary will be a minimum of 11700 for a semi-skilled worker)
HRA - 4200
Bonus 8.33% - 600
Gross Salary - 12000

ECR Challan Generation

To generate an ECR Challan, we show a fixed basic amount of 11700/- and mention Basic for payable days amount 7200/-, and calculate PF on payable days. Is this possible?

Please note that it's advisable to maintain the basic wages not lower than the minimum wages. In your case, gross wages consist of basic pay plus House Rent Allowance (HRA) only. Statutory bonus should not be included in gross wages under any circumstance, and it may be considered as part of the Cost to Company (CTC).

Miss Priya, you should discuss with management about the minimum wages as per government norms and then maintain the minimum wages. HRA is a part of the gross salary, not the basic salary, so do not calculate the bonus on the HRA value.

Also, for PF, the basic salary cannot be less than the minimum wages as per government norms.

Dear Mr. Raj,

Thank you for your reply. I discussed with management about the minimum wages as per government rules. However, in this case, they want PF deductions to be lower. For instance, if the basic salary is at the minimum of 11,700, then the company's PF contribution at 13% amounts to 1,521, which increases the employee's CTC. Bonuses are calculated based on the basic salary.

Hello, For the ECR Challan, use a fixed Basic amount of ₹11,700/- and mention Basic for payable days as ₹7,200/-. Calculate PF on payable days. Hope this helps.