is dearness allownce mandatory in state owened company

abhishek kumar (Querist) 22 March 2011 This query is : Resolved
i am working in madhya pradesh poorva khestra vidyut vitran company ltd as an assistant engineer. this company is 100% owned by madhya pradesh goverment. the company is planing to revise the salary structure. in the new structure it is proposed to remove the dearness allowance . so i want to know that is it legal to remove the dearness allowance by the company. i joined the company in september 2008.

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Guest (Expert) 22 March 2011
In any company Board of Directors has the independence to decide about the service mattrers of the employees. However, if in the case of Public Secor companies, the Centre or the concerned State, as the case may be, makes it compulsory to act according to the provisions of Centre or the State concerned about such matters, the Board has to act accordingly. But, still the date of implementation depends upon the date of passing of the resolution by the Board, unless specifically given retrospective effect through that Board Resolution.

M V Gupta (Expert) 23 March 2011
Pl check ur staff Rules. They set out the salary structure. I am sure they would have included DA as one of the componants. In any revision of pay scales DA is merged with the basic salary and new DA formula is prescribed.

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