Confused About PF Deductions on Minimum Wages? Seeking Your Expert Opinion!

I want to have your opinion on following PF issue.

As per Karnataka Minimum Wages Act for Machine Shops the minimum wages were as under :-

FOR 26 DAYS OF WORKING

MONTHLY PER DAY WAGES

SKILLED LABOUR BASIC – 1430.00 BASIC – 55.00

VDA - 1249.30 VDA - 48.05

_____________ ______________

TOTAL - 2679.30 TOTAL – 103.05

__________ _______________

SEMI-SKILLED LABOUR

BASIC – 1274.00 BASIC – 49.00

VDA - 1249.30 VDA - 48.05

_______________ ______________

TOTAL - 2523.30 TOTAL - 97.05

________ ______



UN-SKILLED LABOUR

BASIC - 1122.00 BASIC – 43.15

VDA - 1249.30 VDA - 48.05

_____________ ________________

TOTAL - 2471.30 TOTAL - 96.20

_____________ _________________

AS PER THE PF ACT WE HAVE TO DEDUCT AND DEPOSIT PF ON BASIC WAGES or Gross Minimum Wages ? Can we biffurcate VDA into HRA, CON.& Washing Allowance etc., and deduct and deposit PF on Basic Wages as mentioned in Minimum Wages Act?

Sir, your early expert opinion shall certainly help us in finalising this valuable issue, as different lawyers/consultants are having different views on it.

Thanking you, expecting a reply soon.

Dear Vinay,

PF is always deducted on Basic Salary, and it is a statutory deduction until the Basic Salary reaches Rs. 6500/- and above this, it is at the discretion of the Management to proceed with these deductions. Alternatively, you can say that above the basic salary of Rs. 6500/-, it is a kind of benefit that the Company extends to employees.

Could you please provide me with the abbreviation for VDA?

Deepa