gratuity & family planning increment

Dear Ram Mohan,

The special increment is not the part of the wages. As per Sec 2(s) under payment of gratuity act,1972 - "wages" means all emoluments which are earned by an employee while on duty or on leave in accordance with the terms and conditions of his employment and which are paid or payable to him in cash and includes DA but does not include any bonus, commission, HRA, overtime wages, and any other allowance.

Hope this is useful to you,

Regards,

Raj Narayan

Dear Mr. Acharya,

When the increment is given whether it forms part of the basic pay or not?  Whether DA is calculated on such basic pay (i.e. including the increment) or not?  Therefore, there should not be any doubt whatsoever in this regard.  Without doubt, it is a wage - it might have been earned on whatever criteria - say passing of hindi examination, achievement in sports, exemplary service etc. 

Any increments, whether it is for additional qualification, granted for family planning, excellance in sports, best perfomance, etc., are added to the basic pay and it includes for the calculation of DA and other perks and calculated as pay in raspect of Government service. The PG Act does not exclude these aspects while computing the salary.

Thanks for the discussion.

Here in this case it is a PSU. This increment is not taken as a part of Basic for the purpose of calculation of DA.However is taken as a part of the basic for calculation of HRA. terminology is also not the allowance. It is increment and fixed. Kindly enlight.

Dear Mr. Acharya,

If the increment is not being treated as a 'wage' it is wrong.   Let us understand the basics.  If some one is granted an increment, will not increase his basic salary?  The increment may be of any kind.  So long as it is called increment, it is nothing but increase in the basic.  Once it forms part of the basic, it is his wage and all the allowances will depend upon that basic.

Whether in your PSU or in any other PSU it is the same.  If some one has wrongly treated the special increment as not basic, that is not correct and the situation needs to be corrected.