Dear All, What is the basic difference between VDA (Variable Dearness Allowance) and Special Allowance? Rahul Vaidya
From India, Pune
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1From India, Pune
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Understanding VDA and Special Allowance
VDA or Variable Dearness Allowance is a payment (part of the total wage) that varies with some Consumer Price Index (whatever the series) compiled by the Government of India (if I am right, by the National Sample Survey). Special Allowance is in the nature of a Dearness Allowance only but is a term used in the Minimum Wages Act. This Special Allowance is statutorily a part of the Minimum Wage under the act and is linked to a particular series also stated under the said act. Because of the different series of Cost of Living/Consumer Price Index and different linkages, these may vary at different rates but in essence, these are identical, being in the nature of a "payment to neutralize the rising costs." Without going into the technicalities of the matter, I suppose this explanation would be adequate!
Regards,
Samvedan
November 20, 2011
From India, Pune
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VDA or Variable Dearness Allowance is a payment (part of the total wage) that varies with some Consumer Price Index (whatever the series) compiled by the Government of India (if I am right, by the National Sample Survey). Special Allowance is in the nature of a Dearness Allowance only but is a term used in the Minimum Wages Act. This Special Allowance is statutorily a part of the Minimum Wage under the act and is linked to a particular series also stated under the said act. Because of the different series of Cost of Living/Consumer Price Index and different linkages, these may vary at different rates but in essence, these are identical, being in the nature of a "payment to neutralize the rising costs." Without going into the technicalities of the matter, I suppose this explanation would be adequate!
Regards,
Samvedan
November 20, 2011
From India, Pune
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agreed with samvedan and in addittion to it VDa is calculated on basis of India wide average consumer price index. this iis done on every jan and july for more details go through labour.nic.in
From India, Warangal
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From India, Warangal
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As far as knowledge is concerned, special allowances are the same as other allowances such as HRA, Cony., Educational Cess, Medical Incentives, and various other allowances. DA/VDA depends on the variation of the consumer index and is defined by the state government from time to time under the Minimum Wages Act.
Thanks and regards,
Sumit Kumar Saxena
From India, Ghaziabad
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Thanks and regards,
Sumit Kumar Saxena
From India, Ghaziabad
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Difference Between DA & VDA
The difference between DA & VDA is explained here. Special allowance is the residual amount of your CTC after adjusting Basic, DA, HRA, and other tax-saving components. I don't think the Minimum Wages Act prescribes anything about special allowance.
Pon
https://www.citehr.com/33995-differe...a-ida-vda.html
From India, Lucknow
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The difference between DA & VDA is explained here. Special allowance is the residual amount of your CTC after adjusting Basic, DA, HRA, and other tax-saving components. I don't think the Minimum Wages Act prescribes anything about special allowance.
Pon
https://www.citehr.com/33995-differe...a-ida-vda.html
From India, Lucknow
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VDA is the part of gross wage where as SPL allowance is excluded the total wage for ex..washing allowance, medica allowance etc Deepak
From India, Hyderabad
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From India, Hyderabad
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Kindly check out the provisions of the Minimum Wages Act. What I referred to as "Special Allowance" is a sanctified and variable component of the Statutory Minimum Wage. Further, CTC has NO statutory recognition/sanctification. It is a tool for budgeting and controlling "Employee Costs". It is certainly NOT the residual component of the wage to be somehow called "Special Allowance" after adjusting Basic, HRA, and other tax-saving components.
I am afraid we differ on this point. I thought I should provide a clarification for the general benefit of the members.
Regards,
Samvedan
November 24, 2011
From India, Pune
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I am afraid we differ on this point. I thought I should provide a clarification for the general benefit of the members.
Regards,
Samvedan
November 24, 2011
From India, Pune
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Yes, I referred to the cited Act. The term "spl. allowance" is used for DA/VDA, I construe. The Act was formulated in 1948, and the term has not yet been changed to DA by our policymakers. CTC is not legal but is practiced worldwide and accepted. In the CTC regime, the definition of "spl. allowance" is as mentioned above. I think most of the members here are under the CTC regime; that's what I meant.
Regards,
Pon
From India, Lucknow
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Regards,
Pon
From India, Lucknow
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Dear Mr. Pon,
While fixing the wage rate for Security Guards and some technically skilled workmen, the Special Allowance is considered by the Government under the Minimum Wages Act. In factory areas, the Minimum Wages are comprised of Basic Wages and Special Allowances for the workmen. However, in the construction industry, the Minimum Wages are bifurcated into Basic Wages and VDA (as per CPI).
From India, Kumbakonam
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While fixing the wage rate for Security Guards and some technically skilled workmen, the Special Allowance is considered by the Government under the Minimum Wages Act. In factory areas, the Minimum Wages are comprised of Basic Wages and Special Allowances for the workmen. However, in the construction industry, the Minimum Wages are bifurcated into Basic Wages and VDA (as per CPI).
From India, Kumbakonam
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Minimum Wages -Special Allowance.pdf
SELF-CERTIFICAT E PROFORMA UNNDER THE MINIMUM WAGES ACT, 1948.doc