I am working in Karnataka. Every year, there will be a notification for making payment for minimum wages, by stating Basic and DA, fixed at nearly Rs. 2842 (Basic - 2545 and VDA - 297).
I agree that we have to pay these wages to the employees. We will not pay it as two components. It will be paid as follows:
Basic: 1500.00
DA: 1842.00
CCA: 500.00
Att. Bonus: 200.00
Total: 4042.00
Please confirm if we can pay as stated above because I am paying more than the minimum wages.
From India, Bangalore
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I agree that we have to pay these wages to the employees. We will not pay it as two components. It will be paid as follows:
Basic: 1500.00
DA: 1842.00
CCA: 500.00
Att. Bonus: 200.00
Total: 4042.00
Please confirm if we can pay as stated above because I am paying more than the minimum wages.
From India, Bangalore
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Dear Mahesh,
Rule 22(2) of the Minimum Wages (Central) Rules defines "wages" as follows: Wages shall mean all remuneration payable to an employed person upon the fulfillment of the contract of employment and includes House Rent Allowance (HRA). It excludes:
(i) The value of rent-free accommodation, supply of light, water, medical facilities...
(ii) Contributions paid by the employer towards the Provident Fund (PF) or any social insurance scheme.
(iii) Travelling allowance/Travelling concession.
(iv) Gratuity.
The wages may consist of:
(i) a basic rate of wages and a special allowance called the cost of living allowance.
(ii) a basic rate with or without cost of living allowance plus any concession on the supply of essential commodities.
Since in your case the basic and Dearness Allowance (DA) (assuming you are deducting PF from this) exceed the stated minimum wages, you are safe.
Best wishes,
Sunil Joshi
From United States, Bedford
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16Rule 22(2) of the Minimum Wages (Central) Rules defines "wages" as follows: Wages shall mean all remuneration payable to an employed person upon the fulfillment of the contract of employment and includes House Rent Allowance (HRA). It excludes:
(i) The value of rent-free accommodation, supply of light, water, medical facilities...
(ii) Contributions paid by the employer towards the Provident Fund (PF) or any social insurance scheme.
(iii) Travelling allowance/Travelling concession.
(iv) Gratuity.
The wages may consist of:
(i) a basic rate of wages and a special allowance called the cost of living allowance.
(ii) a basic rate with or without cost of living allowance plus any concession on the supply of essential commodities.
Since in your case the basic and Dearness Allowance (DA) (assuming you are deducting PF from this) exceed the stated minimum wages, you are safe.
Best wishes,
Sunil Joshi
From United States, Bedford
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Dear Mahesh,
You need to pay the minimum wage as indicated by the enactment. This amount is considered for long-term benefit calculations. Secondly, whatever you pay above this amount is at your will and wish and on whatever account.
With warm regards,
Manjunatha PG
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You need to pay the minimum wage as indicated by the enactment. This amount is considered for long-term benefit calculations. Secondly, whatever you pay above this amount is at your will and wish and on whatever account.
With warm regards,
Manjunatha PG
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Dear all,
I have one query: How much should be the minimum basic wage paid to an employee in metros, and is DA inclusive in minimum wages? As far as I know, the minimum basic has been fixed at 3314/-. Can anyone elaborate on that?
Regards,
Gitanjali
From India, Delhi
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I have one query: How much should be the minimum basic wage paid to an employee in metros, and is DA inclusive in minimum wages? As far as I know, the minimum basic has been fixed at 3314/-. Can anyone elaborate on that?
Regards,
Gitanjali
From India, Delhi
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Dear Mahesh,
The Minimum Wages notification is issued by the State Labour Department bi-annually. The rate specified is the minimum wage that an employer must pay to employees covered under the Act. In addition to the Minimum Wages, some states like West Bengal have a compulsory House Rent Allowance (HRA) provision that must also be paid.
Therefore, in the absence of the above, the Minimum Wages must be paid, and both the Employee State Insurance (ESI) and Provident Fund (PF) are deducted. There is no provision in the Minimum Wages where you can divide the wages into components. The PF authorities at least charge PF on the Minimum Wages.
I would like to clarify that it is entirely legal for an employer to pay only the Minimum Wages.
Regards,
SC
From India, Thane
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The Minimum Wages notification is issued by the State Labour Department bi-annually. The rate specified is the minimum wage that an employer must pay to employees covered under the Act. In addition to the Minimum Wages, some states like West Bengal have a compulsory House Rent Allowance (HRA) provision that must also be paid.
Therefore, in the absence of the above, the Minimum Wages must be paid, and both the Employee State Insurance (ESI) and Provident Fund (PF) are deducted. There is no provision in the Minimum Wages where you can divide the wages into components. The PF authorities at least charge PF on the Minimum Wages.
I would like to clarify that it is entirely legal for an employer to pay only the Minimum Wages.
Regards,
SC
From India, Thane
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Hi all,
Please guide me on the following:
In Uttarakhand, the minimum wage for Clerk II category is 3165 (Basic + DA). Could you clarify if this amount should be the minimum Basic wage, or if we can separate it into Basic + DA + HRA since HRA is already included in the Minimum wages, and the total amount exceeds the Minimum wage? Your prompt advice is appreciated.
For example:
Basic - 2000
DA - 200
HRA - 1300
Conveyance allowance - 800
Total - 4300
Is this breakdown correct? Please let me know.
Regards,
Anagha
From India, Calcutta
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Please guide me on the following:
In Uttarakhand, the minimum wage for Clerk II category is 3165 (Basic + DA). Could you clarify if this amount should be the minimum Basic wage, or if we can separate it into Basic + DA + HRA since HRA is already included in the Minimum wages, and the total amount exceeds the Minimum wage? Your prompt advice is appreciated.
For example:
Basic - 2000
DA - 200
HRA - 1300
Conveyance allowance - 800
Total - 4300
Is this breakdown correct? Please let me know.
Regards,
Anagha
From India, Calcutta
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Hi Can any one guide me about the Maharastra minimum Wage information and the Calcution. Its Urgent Regards, Sashi
From India, Pune
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From India, Pune
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Dear All,
The Minimum Wages enforcement machinery is sometimes not very clear on the quantum of Basic wages (which attracts PF, Gratuity, Bonus). However, as a thumb rule, I have seen some labor inspectors in some states - look at the concept of 60-40 - that is Basic wages should not be less than 60% of Gross salary and the Allowances should be the balance. You can check with your local industries/industry association about this. Better to be safe than sorry at the time of your next labor inspection :)
Regards,
P. Arun Kumar
From India, Bangalore
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The Minimum Wages enforcement machinery is sometimes not very clear on the quantum of Basic wages (which attracts PF, Gratuity, Bonus). However, as a thumb rule, I have seen some labor inspectors in some states - look at the concept of 60-40 - that is Basic wages should not be less than 60% of Gross salary and the Allowances should be the balance. You can check with your local industries/industry association about this. Better to be safe than sorry at the time of your next labor inspection :)
Regards,
P. Arun Kumar
From India, Bangalore
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A small addition to what I had mailed earlier - the concept of a 60-40 breakup in basic wages and allowances - is observed more by the PF inspectors who assess the contribution quantum in relation to the overall gross salary of the employee.
Regards,
P. Arun Kumar
From India, Bangalore
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Regards,
P. Arun Kumar
From India, Bangalore
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Please guide me in the following case. We appointed an accountant in Delhi/NCR with the salary structure as below:
Basic: 2800
HRA: 1450
Conveyance: 1250
Total: 5500/-
Is this the correct structure, or should we also pay him basic VDA, etc.?
From India, Gurgaon
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Basic: 2800
HRA: 1450
Conveyance: 1250
Total: 5500/-
Is this the correct structure, or should we also pay him basic VDA, etc.?
From India, Gurgaon
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Hi 4 HRD, In Delhi the revised minimum wage to be paid to Graduate and above is Rs 4230.00 per month so you are entirely safe. Amit Goyal
From India, Delhi
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From India, Delhi
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Minimum wages should not be broken into more than two components. There are different slabs for unskilled, semi-skilled, skilled, matriculate, and so on. Having too many components in minimum wages indicates that the Head of HR in that company is trying to save money through statutory liabilities. Please refer to Group 4's case in Karnataka High Court.
Surya
From India, Delhi
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Surya
From India, Delhi
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Dear All, Can any one help me by providing the minimum wages for maharashtra for skilled semi skilled and highly skilled workers. Regards, Trupti :P
From India, Pune
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From India, Pune
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Hi all HR,
I have a query about the basic minimum wages in Andhra Pradesh.
4500 Basic
2000 HRA
850 Conveyance
800 Flexible Allowance
One of the consultants said that the basic should be 60% of the Gross. What should I do?
From India, Hyderabad
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I have a query about the basic minimum wages in Andhra Pradesh.
4500 Basic
2000 HRA
850 Conveyance
800 Flexible Allowance
One of the consultants said that the basic should be 60% of the Gross. What should I do?
From India, Hyderabad
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Dear All, Greetings of the day. Can anyone plz suggest the minimum wage strecture for Andhra Pradesh. Rams.
From India, Hyderabad
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From India, Hyderabad
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Dear ALL, When a workers leaving the company, what benefits he will get from employer? Regards, sharat
From India, Calcutta
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From India, Calcutta
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Hi Any one can help me to get the Karnataka State minimum wage slab for years of 2008, 2009 & 2010. Its very useful me. Thx n rgds. Satheesh. A +919611199935
From India, Madras
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From India, Madras
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Agreed on the 60-40 concept, but the question is: Is this minimum wage calculated based on 26 days or 30 days for payment?
For example, if the minimum wage per day is $350, should the monthly salary be calculated based on 26 days or 30 days?
From India, Delhi
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For example, if the minimum wage per day is $350, should the monthly salary be calculated based on 26 days or 30 days?
From India, Delhi
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In the context of minimum wage calculations, Basic Pay and Dearness Allowance (DA) are often combined to ensure employees receive a fair and adequate wage. Here's a breakdown of how they are typically calculated and understood:
Basic Pay
Basic Pay is the core component of an employee's salary. It is the fixed part of the wage that is agreed upon without any allowances or bonuses. It serves as the foundation for calculating other components of the salary such as allowances and benefits.
Dearness Allowance (DA)
Dearness Allowance is a cost of living adjustment allowance paid to employees to mitigate the impact of inflation. DA is typically calculated as a percentage of the Basic Pay. The rate of DA is revised periodically, often semi-annually, based on the inflation rate and cost of living index.
Combined Pay Approach
In some contexts, Basic Pay and DA are combined into a single wage component rather than being paid separately. Here's how this can work:
Combined Minimum Wage
Instead of specifying separate amounts for Basic Pay and DA, a combined minimum wage rate can be established. This approach simplifies payroll and ensures that employees receive a consolidated amount that meets or exceeds the statutory minimum wage.
Calculation Method
The combined wage is determined based on the total minimum wage required by law, including adjustments for inflation and cost of living. For example, if the minimum wage is set at ₹15,000 per month, this amount would include both the Basic Pay and any DA, rather than listing them separately.
Example Calculation
Suppose the minimum wage for a factory worker is set at ₹15,000 per month. This amount includes both Basic Pay and DA. Here's a simple illustration: If Basic Pay is determined to be ₹12,000, then DA would be ₹3,000. Alternatively, if the factory decides to simplify the payment structure, they might just state the total pay as ₹15,000 without breaking it down into Basic Pay and DA.
Legal and Practical Considerations
Legal Compliance: Employers must ensure that the combined pay meets or exceeds the minimum wage requirements as stipulated by law, including any adjustments for inflation or cost of living.
Payroll Management: Combining Basic Pay and DA into a single component can simplify payroll processing and reduce administrative complexity.
Employee Communication: Clear communication with employees regarding how their pay is structured and how it meets legal requirements is crucial to avoid misunderstandings. It's important for factories and employers to stay updated with local labor laws and regulations regarding minimum wages and to ensure that their pay structures are compliant.
From India, Mumbai
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Basic Pay
Basic Pay is the core component of an employee's salary. It is the fixed part of the wage that is agreed upon without any allowances or bonuses. It serves as the foundation for calculating other components of the salary such as allowances and benefits.
Dearness Allowance (DA)
Dearness Allowance is a cost of living adjustment allowance paid to employees to mitigate the impact of inflation. DA is typically calculated as a percentage of the Basic Pay. The rate of DA is revised periodically, often semi-annually, based on the inflation rate and cost of living index.
Combined Pay Approach
In some contexts, Basic Pay and DA are combined into a single wage component rather than being paid separately. Here's how this can work:
Combined Minimum Wage
Instead of specifying separate amounts for Basic Pay and DA, a combined minimum wage rate can be established. This approach simplifies payroll and ensures that employees receive a consolidated amount that meets or exceeds the statutory minimum wage.
Calculation Method
The combined wage is determined based on the total minimum wage required by law, including adjustments for inflation and cost of living. For example, if the minimum wage is set at ₹15,000 per month, this amount would include both the Basic Pay and any DA, rather than listing them separately.
Example Calculation
Suppose the minimum wage for a factory worker is set at ₹15,000 per month. This amount includes both Basic Pay and DA. Here's a simple illustration: If Basic Pay is determined to be ₹12,000, then DA would be ₹3,000. Alternatively, if the factory decides to simplify the payment structure, they might just state the total pay as ₹15,000 without breaking it down into Basic Pay and DA.
Legal and Practical Considerations
Legal Compliance: Employers must ensure that the combined pay meets or exceeds the minimum wage requirements as stipulated by law, including any adjustments for inflation or cost of living.
Payroll Management: Combining Basic Pay and DA into a single component can simplify payroll processing and reduce administrative complexity.
Employee Communication: Clear communication with employees regarding how their pay is structured and how it meets legal requirements is crucial to avoid misunderstandings. It's important for factories and employers to stay updated with local labor laws and regulations regarding minimum wages and to ensure that their pay structures are compliant.
From India, Mumbai
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SALARY CAN BE SPLIT INTO COMPONENTS BUT NOT LESS THAN THE MINIMUM WAGES.docx
Delhi Minimum Wages w.e.f. 01.10.2015.pdf