Supreme Court clarifies definition of basic wages

CreditAccess India capital money

The Supreme Court, in a recent judgment, clarified whether allowances paid to employees would fall within the definition of basic wages in the context of calculating contributions to employee’s provident funds (PF).

The case, in the Regional provident fund commissioner (ii) West Bengal v Vivekananda Vidyamandir and ors, comprised five different appeals or transferred cases where employers and regional provident fund commissioners were seeking clarification whether certain allowances were to be excluded from the aggregate amount on which PF contribution under section 6 of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952, (EPF act) is calculated.

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