Back Ground of the Act:-

             The Employees Provident Funds And Miscellaneous Provisions Act, 1952. The Act is a beneficent measure enacted for the purpose of institution of provident fund for the employees in factories and other establishments. The provisions have been made for the better future for the industrial worker.

             Provident Fund should be deducted on Minimum Wages and There fore Basic and Cola should be according to Minimum wages act?

1.The Employees Provident Funds and miscellaneous Provisions Act 1952 is a Central Act on the other hand Minimum Wages Rules is a State Act. Provident Fund Act Should be similar to the extent of whole of India except State of Jammu & Kasmir where as Minimum Wages Rule is differ from state to state industries. The Central act should be homogeneous and not heterogeneous to the extent of its applicability unless the exemption given under specific section or notification or amendments made from time to time.

2. As per section 2(h) of the Minimum Wages Act, 1948 “Wages” means all remuneration, capable of being contract of employment, express or implied were fulfilled be payable to a person employed in respect of his employment of his employment or of work done in such employment and includes house rent allowance but does not include the value of

1.  Any house accommodation, supply of light, water medical attendance or
2.  Any other amenity or any service excluded by general or special order of the appropriate government.
3.  Any contribution paid for pf, pension fund or any social insurance scheme.
4.  Any travelling allowance or the value of any travelling concession.
5.  Any sum paid for defray special expenses due to nature of his job.
6.  Any gratuity payable on his discharge.

Minimum wages consist of a component called special allowance. A special allowance and directs that so long as the notification is in force, the rate of such special allowance shall be adjusted by the competent authorities at the interval of every six months commencing from 1^st October and 1^st April on the basis of the average cost of living index numbers for the preceding period for six months ending on the 30^th June and 31^st December respectively in such manner that:

                 a. For the rise of every five points over the cost of living index number 1645 or over any such number which is greater than 1645 applicable to the employees in the scheduled employment special allowance payable in addition to the basic rate of wages shall be of Rs.0.20 paise per day for the  every five points below any cost of living index number which is not less 1645 the special allowance shall be reduced at the rate of Rs.0.20 paise per day. Provided that the rates of Special Allowance shall be first adjusted at the interval of the period of six months commencing from the prospective date.

                 The above theory is the base for determining the minimum wages for the period for territory wise. Which is called as index, index never remaining static or it doesn’t take deviation towards upward mode some time move towards downward trend which is depend on the demand supply of the goods, inflation or deflation rate, boom and depression, Economic Growth, political factor, inflow outflow of fund, foreign investment export import policy etc.

               Thus minimum wages may be high a couple hundred in period of six month if you set basic rate accordingly in the next interval it may fall to same extent or more will it be possible to keep a interval of six month at high rate of basic on the other hand in the next interval it may be reduced.

               i)   The cash value of any food concession

             ii)  Any dearness allowance that is to say, all cash payment by whatever name called paid to an employee on account of rise in the cost of living, house rent allowance, overtime allowance, bonus, commission or any other similar allowance payable to the employee in respect of his employment or of work done in such employment.

             iii)  Any present made by the employer   

In above case you can clearly view that the above section just gives meaning of the basic wages it doesn’t make any relevance with the minimum wages act basic. More over it doesn’t give any minimum limit or maximum limit of basic wages. It also excluded the other allowances for considering the basic wages even it doesn’t enlighten us about what should be the basic wages for time rated worker and piece rated worker. Employees Provident Fund & Misc Provisions Act 1952 is silent in above all matter therefore judgment given by either high court or apex court in this regard from time to time purely depends on the terms of condition, agreements made between worker and management as per settlement as per award given by the labour court and as mutually agreed in the appointment letter. Therefore courts put focus on the changes made from time to time on such agreement and assess the affected areas in different law and relevant parties.

 Example

      1.  Bridge & Roof Co (I) Ltd V Union of India 1962 II LLJ 490.

      2.  Burmah- Shell oil storage & distributing Co.Ltd Vs R.P.F.C Delhi 1981 II LLJ 86

      3. Shree Changadeo Sugar Mills Vs Union Of India 2001. I Clr 701 (S.C)

     4. K.Ramnathan Chettiar Jewellers, Madurai V Regional Commissioner, Employees Provident Fund, madurai, 1998 II LLJ 945 (Mad.H.C)

     5. Ponni Sugar & Chemicals Ltd . Pallipalayam, Erode Vs Cauvery Sugar & Chemicals Ltd. 2001 II LLJ 1201 (Mad – D.B)

5.Definition of wages is differs from act to act under labour laws.

        i)  Under Section 2 (h) of the minimum wages act, 1948 “Wages” means all remuneration, capable of being expressed in terms of money, which would if the terms of the contract of employment, express or implied, were fulfilled be payable to a person employed in respect of his employment or of work done in such employment and includes house rent allowance.

      ii)  Under Section 22 Of The Employees State Insurance Act, 1948 “Wages” means all remuneration paid or payable, in cash to an employee if the terms of the contract of employment, express or implied, were fulfilled and includes any payment to an employee in respect of authorized leave, lockout, strike, which is not illegal or layoff and other additional remuneration, if any paid at intervals not exceeding two months, but doesn’t include 

              a.  Any contribution paid by the employer to any pension fund or provision fund, or under this Act

              b.  Any travelling allowance or the value of any travelling concession

              c.  Any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or

              d.  Any gratuity payable on discharge

6.Under section 2 rr of Industrial Disputes Act, 1947 defines “Wages” means all remuneration capable of being expressed in terms of money, which would, if the terms of employment, express or implied, were fulfilled, be payable to a workman in respect of his employment or of work done in such employment and includes

           i)  Such allowance (including dearness allowance) as the workman is for the time being entitled to;  

         ii) the value of any house accommodation, or of supply of light water, medical attendance or other amenity or of any service or of any concessional supply of foodgrains or other articles;

         iii) any travelling concession; iv)any commission payable on the promotion of sales or business or both; but does not include

             i)  any bonus;

7.Under section 21 of payment of bonus act 1965 “Salary or Wages” means all remuneration (other than remuneration in respect of overtime work) capable of being expressed or implied were fulfilled, be payable to an employee in respect of his employment or of work done in such employment and includes dearness allowance (that is to say, all cash payment, by whatever name called, paid to an employee on account of a rise in the cost of living but does not include

           1.  Any other allowance which the employee is for the time being entitled to;

          2. The value of any house accommodation or of supply of light, water medical attendance or other amenity or of any service or of any concession supply of food grains or other articles;

                  a.  Any travelling concession;

                  b.  Any bonus (including incentive, production and attendance bonus);

                 c.  Any contribution paid or payable by the employer to any pension fund or provident fund or for the benefit of the employee under any law for the time being in force;

                 d. Any retrenchment compensation or any gratuity or other retirement benefit payable to the employee or any ex gratia payment made to him;

                 e. Any commission payable to the employee.

8. Under Section 2 h (vi) of the Payment of Wages Act 1936 “Wages” means all remuneration (whether by way of salary, allowance or otherwise expressed in terms of money or capable of being so expressed which would if the terms of employment, express or implied were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes.

          a.  any remuneration payable under any ward or settlement between the parties or order or a court;

          b. any remuneration to which the person employed is entitled in respect of overtime work or holiday or any leave period;

          c. any additional remuneration payable under the terms of employment (Whether called a bonus or by any other name);

         d. Any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions, but does not provide of the time within which the payment is to be made;

          e. Any sum to which the person employed is entitled under any scheme framed under any law for the time being in force; But does not include

   1) any bonus (whether under a scheme or profit sharing or otherwise) which does not form part of the remuneration payable under the terms of employment or which is not payable under any award of settlement  between the parties or order or a court;

 9. Under section 2 m of the Workmen’s Compensation Act,1923   “Wages” includes any privilege or benefit which is capable of being estimated in money, other than a travelling allowance or the value of any travelling concession or a contribution paid by the employer a workman towards any pension or provident fund or a sum paid to a workman to cover any special expenses entailed on him by the nature of his employment;

10.Under section 2 g of the Equal Remuneration Act, 1976    

  “Remuneration” means the basic wage or salary, and any additional emoluments whatsoever payable, either in cash or in kind, to a person employed in respect of employment or work done in such employment, if the terms of the contract of employment, express or implied, were fulfilled;

 11.Under section 2 (h) Contract Labour (Regulation And Abolition) Act, 1970 “Wages” shall have the meaning assigned to it in clause (vi) of section 2 of the payment of wages Act 1936.

 12.Under section 2 (s) of The Payment of Gratuity Act, 1972 “Wages” means all emoluments which are earned by an employee while on duty or leave in accordance with the terms and condition of his employment and which are paid or are payable to him in cash and includes dearness allowance but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance.

 13.Under section 2 (i) of Industrial Employment (Standing Orders) Act, 1946

             “wages” and “workman” have the meaning respectively assigned to them in clauses (rr) and (s) Section 2 of the Industrial Disputes Act, 1947.

             You can view that each labour laws enacted defines the meaning of wages in particular section but if any act not defines the definition of wages but it has mentioned the which acts section we have refer for that purpose.
             For example in case of

                   i) Industrial Employment (Standing Order) Act, 1946 we have refer to clauses (rr) and (s) of Section 2 of the Industrial Disputes Act 1947.

                   ii) Contract Labour (Regulation And Abolition) Act, 1970 we have refer the section 2 of the payment of wages Act 1936

             Where as in Employees State Insurance Act, 1948 it is clearly stated that under section 24 All other words and expressions used but not defined in this Act and defined in the Industrial Disputes Act 1947, 14 of 1947 shall have the meaning respectively assigned to them in that act.

             Above all acts wages definitions enlighten us that all acts are independent acts they have designed their own meaning of wages and further they have own section to safe guard the objectives of the each act they have to nothing to do with other acts section of wages. We can detect that meaning of wages is wider in one act on the other hand in another act it may be narrow. Some allowance were excluded in one act it may be included in another act.

            Moreover we can see that one thing is homogenous in all acts is  “Terms of Employment or contract express or implied”. As I Pointed out earlier agreement between the worker and managements as per settlement, as per award given by the labour court and as mutually agreed in the appointment letter of employee. Which play the vital rule and had heavy hold in providing any justice. If worker and employer agree then there is no space to poke nose in between by any 3^rd party to decide to pay more or less.

 14. Now we take the ceiling factor to whom the benefit should be given by different act for example

    a. Under the employees provident funds and miscellaneous provisions act 1952 Rs.6500/- p.m (Basic and Da).

    b. Under The Employees State Insurance Act, 1948 Rs.7500/- p.m (Excluding any travelling allowance

    c. Under the workmen’s compensation Act, 1923 p.m

                 i)  Where permanent total disablement result from the injury 50% of monthly wages x relevant factor or Rs.24000/-

                ii)  Where permanent total disablement result from the injury 50% of monthly wages x relevant factor or Rs.24000/-

               iii) Where permanent partial disablement or temporary disablement result from injury as per prescribed schedule.

    d. Under payment of wages act, 1936 Rs.6500/-p.m e.Under payment of bonus act,1936 Rs.3500/-p.m

        Apart from workmen compensation act (minimum & Maximum mentioned above) and bonus act (8.33 and 20%) it clearly stated in sections or in schedule what should be the minimum and maximum benefit. Taking into consideration above facts both central act defined minimum limit but other acts didn’t carved the section for this purpose because they nothing to do with this. It depends only the terms and agreement between the employees and employer.

       All acts came into existence in different years apart from The Maternity Benefit Act, 1961 & The Apprentice Act, 1961. Minimum Wages Act came into existence in 1948 where as the Employees Provident Funds and Miscellaneous Provisions Act came into Existence in year 1952. Suppose it has to make relevance of basic section 2 (b) in her act instead of that it straight away depict the section of minimum wages or either refer notification of basic wages as given by government department from at specific intervals as I quoted  a couple of sentence in page 3 & 4 in this regard.

     When you quote the pf should be deducted on minimum wages then you have to first determine what the meaning of wages in minimum wages. It is not only basic will be considered for minimum wages other components of wages are also taken into consideration under section 2 (h) of The minimum wages act and various judgment given by supreme court and high court.

  1.  Airfreight Ltd Vs State of Karnataka & others In

  2. In The High Court of Andra Pradesh CLR III 2002 P 416 Management of Ramkrishna Phramaceuticals Vs State Authority under Minimum Wages Act and Joint Commissioner of Labour Hyderabad & ors.

  3. Harilal Jechand Doshi, Ghatkopar Hindhu Sabha Hospital Vs Maharashtra General Kamgar Union & Anr.

Conclusion

           Thus in net shell it is clearly indicative that unless it is not clearly defined in the section or sections we do not have any right to verify other act for any interpretation whether it basic or anything else. We are not in position to make comparison for any components. Not a section of the provident fund act has not defined that component of “basic rate” as defined in the minimum wages act or rules we have to refer.