The document summarizes various labor laws and employee benefits in India. It discusses laws such as the Payment of Wages Act, Minimum Wages Act, Employee Provident Fund Act, Payment of Bonus Act, Gratuity Act, Maternity Benefit Act, Workmen's Compensation Act, and Employees' State Insurance Act. It provides details on the applicability, eligibility criteria, and key benefits prescribed under each law such as minimum wages, timely payment of wages, provident fund contributions, bonus payments, gratuity amounts, maternity benefits, and compensation for work-related injuries. It also discusses allowances paid to employees and their taxability, as well as dearness allowance calculation.

1. Submitted To :- Prof.Taqdees
Chetana’s
H.S. College of Com.&Eco.&
Smt.Kusumtai Chaudhari
College of Art.
(CSFC)
SUBJECT :- Human Resource Management

2. Company
LOGO
GROUP
NO :- 10
“Act of Salary and Compensation”

3. Names Roll No
Akash Gupta 3119
Abhishek Shetty 3149
Anagha 3128
Prachi Chaube 3106
Mustaqeem Navrange 3138

4. Payment of Wages Act, 1936
Applicability:
•Every person employed in any factory, upon any railway or through subcontractor in a railway
and a person employed in an industrial or other establishment.
Eligibility:
•Every person who is employed in any of the above mentioned
establishments and who is drawing less than Rs. 1,600 per month
Benefits: the Act prescribes for
•The regular and timely payment of wages (on or before 7th day or 10th day after last day of the wage
period in respect of which the wages are payable).

5. Applicability
•Any person who directly or through another person, whether for himself or for
any other person employs one or more employees in any scheduled employment
in respect of which minimum rates of wages have been fixed under this Act.
Eligibility
•Any person who is employed for hire or reward to do any work in a scheduled
employment and includes an outdoor worker to whom any articles or materials are
given for either doing some work either at home or at any other premises.
Benefits
•The Act prescribes the minimum rates of wages payable to employees for
different scheduled employment for different class of work and for adults,
adolescents, children and apprentices depending upon different localities.

7. Scheme Employee's
Contribution
Employer's
Contribution
Employee Provident Fund
(EPF)
12% 3.67%
Employee Pension
Scheme (EPS)
8.33%
Administration Charges 1.10%
Employee Deposit-Linked
Insurance Scheme (EDLI)
0.50%
EDLI Administrative
Charges
0.01%
Total 12% 13.61%
Applicability of the Act
•To every factory employing 20 or more persons.
•An employee whose pay at the time he is otherwise entitled to
become a member of the fund exceeds Rs.6500/- per month
Rates of Contribution
(Provident Fund is calculated from Basic Salary + DA)

8. Payment of Bonus Act, 1965
Applicability
•Every factory (as def. in Factories Act), & (b) Every other establishment in which 20 or
more persons (less than 20 but 10 or more if appropriate Govt. notifies) are employed on
any day subject to certain exemptions.
Eligibility
•Every person (other than an apprentice)
drawing salary up to RS 3,500 per month.
• Every person drawing salary between RS
2,501/- and RS 3,500/- per month. The
bonus payable to him is to be calculated as
if his salary were RS 2,500/- p.m.

9. Contd…
Penal Provisions
•Imprisonment up to 6 months and or fine up to RS 1000/-

10. Gratuity is a defined benefit plan and is one of the many retirement benefits offered
by the employer to the employee upon leaving his job. An employee may leave his job
for various reasons, such as - retirement/superannuation, for a better job elsewhere,
on being retrenched or by way of voluntary retirement.
Benefits
•The quantum of gratuity is to be computed at the rate of 15 days wages (7 days
wages in case of seasonal establishments) based on rate of wages last drawn by
the employee concerned for every completed year of service or a part thereof
exceeding 6 months.
Applicability
I. Every factory (as defined in Factories Act), mine, oilfield, plantation, port and railway.
II. Every shop or establishment to which Shops & Establishment Act of a State applies in which 10
or more persons are employed at any time during the year end.
III. Any establishment employing 10 or more persons as may be notified by the Central Government.
IV. Once Act applies, it continues to apply even if employment strength falls below 10.

11. Calculation of Gratuity
•Gratuity =
Monthly Salary x 15 days x No. of yrs. of service 26
•Let’s consider 2 situations here – (a) Varun’s employer is covered under
Payment of Gratuity Act, 1972; and (b) Varun’s employer is not covered
under Payment of Gratuity Act, 1972.
Salary = Basic + DA = Rs 40,000 pm + Rs 5,000 pm = Rs 45,000 pm.
•Average salary = 10 months’ salary (immediately proceeding the month of
leaving the job)/10 = (Rs 45,000 pm * 10)/10 = Rs 45,000 pm. Therefore,
half-month’s average salary is = Rs 45,000/2
Let’s understand the above math clearly with an example:
Varun had been working with an IT company since past 10
years, 7 months. He is retiring on 15th April, 2010. His current
Basic = Rs 40,000 pm, DA = Rs 5,000 pm. He is going to
receive a gratuity amount of Rs 3 lakhs on retirement. Note:
Varun’s basic and DA have been the same since past 1 year.
Example

12. Compensation & Benefits
Compensation strategies can affect many facts of the
business. Such as;
 Improved employee morale and retention
 Increased employee engagement and productivity
 Strengthened governance and compliance with
company vision and mission
Compensation is the methods and practices of
maintaining balance between interests of operating
the company within the fiscal budget

13. Maternity Benefit Act 1961
OBJECT:
(1) To provide for maternity benefit to women employees; and
(2) To regulate the employment of women for certain periods before and after childbirth.
The Act was enacted to have uniform maternity benefit provisions for all women
employees.

14. Period for which a woman is entitled to maternity benefit
and the nature of benefit OR Right to payment of
maternity benefit: Sec. 5 and 18:
1. Maximum period a woman is entitled to maternity benefit shall be 12
weeks of which up to 6 weeks shall be before the date of her expected
delivery.
2. If the woman dies during this period, the maternity benefit shall be payable
only for the days up to and including the day of her death.
3. If the woman, having delivered a child, dies during the period for which she is entitled
for the maternity benefit, leaving behind the child, the employer shall pay the maternity
benefit for the entire period. If the child also dies during the staid period, then the
payment shall be made up to the date of the death of the child.
4. A woman shall not be entitled to MB unless she has actually worked in the
establishment for a period of not less than 80 days in the 12 months
immediately preceding the date of her expected date of delivery.
5. When calculating the number of days a woman has actually worked, the
days of lay-off or leave with wages shall be included.

15. Workmen Compensation Act, 1923
Employer's liability to pay compensation to a workman
•According to Sec. 3 "On death or personal injury resulting into total or
partial disablement or occupational disease caused to a workmen
arising out of and during the course of the employment."
Amount of compensation
a) Where death of a workman results from the injury - An amount equal to fifty per cent of the
monthly wages of the deceased workman multiplied by the relevant factor on an amount of
eighty thousand rupees, whichever is more.
b) Where permanent total disablement results from the injury.
c) An amount equal to sixty per cent of the monthly wages of the injured workman multiplied by
the relevant factor or an amount of ninety thousand rupees, whichever is more.
Procedure for calculation Higher the age – Lower the compensation

16. DA-Calculator
•Say, if you want to calculate Dearness Allowance get the average of
monthly All India Consumer Price Index (AICPI) with the base year
2001=100 for the preceding 12 months and apply the same in the following
formula
Dearness Allowance = (Avg. of AICPI for the past 12 months – 115.76)*100/115.76

17. Different Types of Allowances and Their Taxability
City Compensatory Allowance: It paid generally to compensate higher cost of
living in certain big cities. It is also taxable.
House Rent Allowance [10(13A) and Rule 2A]:This sort of relief is granted by
the employer to the employee in order to compensate him in the matter of higher
rent prevailing in big cities.
Foreign Allowance [10(7)]:This allowance is paid by the Government of India
to its citizen employees for being posted outside the country and it is not included
in total income. It is completely tax-free.
Travelling Allowance: Travelling allowance paid to the
employees and spent or them on official duties is not taxed. If
however some allowance remains unspent, it is put to tax.

18. Employees State Insurance
Employees' State Insurance is a self-financing social security and health insurance
scheme for Indian workers. For all employees earning 15000 or less per month as
wages, the employer contributes 4.75 percentages and employee contributes 1.75
percentages, total share 6.5 percentage.
The benefits are broadly classified into two: (1) Medical benefits and (2) cash benefits.
In case of employment-related disablement or death there is provision for a disablement benefit and a
family pension, respectively. Funeral Benefit to dependents of Insured Persons/Insured Women. Super
Specialty Treatment through Private Tie up Network as well as through its own Super Specialty Hospitals
situated throughout India.
Recent years have seen an increasing role of information technology in ESI, with the
introduction of Pehchan smart cards in 'Project Panchdeep', India's largest e-governance project.
In addition to insured workers, poor families eligible under the Rashtriya Swasthya Bima Yojna
can also avail facilities in ESI hospitals and dispensaries. There are plans to open medical,
nursing and paramedical schools in ESI hospitals.

19. Thank
you