1. Is ESI+PF share to be deducted from arrear salary (which section)?
2. One of our employees is currently receiving a salary of basic 4500 + HRA 1000 + conveyance 500. Now, as per the revised minimum wages, the basic should be 6000/-. Can we adjust the amount from the allowances so that his minimum salary will be 6000/- without any extra increment?
From India, Delhi
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2. One of our employees is currently receiving a salary of basic 4500 + HRA 1000 + conveyance 500. Now, as per the revised minimum wages, the basic should be 6000/-. Can we adjust the amount from the allowances so that his minimum salary will be 6000/- without any extra increment?
From India, Delhi
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Please refer to Chapter VIII of the ESI manual regarding contributions on wages paid for back periods (arrears of wages):
CONTRIBUTION
CHAPTER VIII
Thus, non-payment of contributions results in the payment of penal interest, damages, and also invites criminal action simultaneously.
8.19 Contributions on Wages Paid for Back Periods (Arrears of Wages):
The question of payment of wages for a back period arises in any one of the following contingencies:
1. Sanction and payment of increment from a previous period.
2. Any increase in wages/remuneration declared from a retrospective date as a result of wage revision under mutual agreement with the employees’ association/union and the management.
3. Periodical increases in Dearness Allowance from a back date.
4. An award of a tribunal or a judgment of any court.
5. A unilateral decision by the management effecting an increase in pay.
In all the above contingencies, the liability towards payment of contribution accrues only from the month in which the increment is sanctioned, the agreement is entered into, the increase is announced, the judgment is pronounced, or the decision is taken, as the case may be. There is no need to pay any contribution on the arrears pertaining to the period prior to the month of declaration/announcement/agreement, as the case may be.
From India, Pune
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9CONTRIBUTION
CHAPTER VIII
Thus, non-payment of contributions results in the payment of penal interest, damages, and also invites criminal action simultaneously.
8.19 Contributions on Wages Paid for Back Periods (Arrears of Wages):
The question of payment of wages for a back period arises in any one of the following contingencies:
1. Sanction and payment of increment from a previous period.
2. Any increase in wages/remuneration declared from a retrospective date as a result of wage revision under mutual agreement with the employees’ association/union and the management.
3. Periodical increases in Dearness Allowance from a back date.
4. An award of a tribunal or a judgment of any court.
5. A unilateral decision by the management effecting an increase in pay.
In all the above contingencies, the liability towards payment of contribution accrues only from the month in which the increment is sanctioned, the agreement is entered into, the increase is announced, the judgment is pronounced, or the decision is taken, as the case may be. There is no need to pay any contribution on the arrears pertaining to the period prior to the month of declaration/announcement/agreement, as the case may be.
From India, Pune
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PF Contribution on not less than Minimum Wage.pdf
Minimum Wages, ESI & PF.pps