'Basic Wage' and 'Minimum Wage' have different definitions under different Acts, can't be equated, rules SC [Read Order]

Dismissing an appeal filed by the Assistant Provident Fund Commissioner, the Supreme Court has ruled that 'Basic Wage' and 'Minimum Wage' cannot be equated with each other.

A division bench of Justice Hima Kohli and Justice Rajesh Bindal has reiterated that 'Basic Wage' and 'Minimum Wage' carry different definitions under the Employee Provident Fund Act 1952 and Minimum Wages Act, 1948 respectively.

"In our opinion, once the EPF Act contains a specific provision defining the words ‘basic wage’ (under Section 2b), then there was no occasion for the appellant to expect the Court to have traveled to the Minimum Wages Act, 1948, to give it a different connotation or an expansive one, as sought to be urged. Clearly, that was not the intention of the legislature", the court said.

The appeal was filed against one Punjab and Haryana High Court order. by which, the single-judge bench order of dismissing the writ-petition of the appellant was affirmed.

Before the learned Single Judge, the appellant had impugned the order dated 15th June 2009, passed by the Appellate Tribunal under the provisions of the Employees Provident Fund and Miscellaneous Provisions Act, 19523, while determining the issue raised by the respondents regarding the liability of the Management under the provisions of Section 7A of the EPF Act.

It was the case of the appellant is that for the purposes of determining its contribution towards the provident fund, the respondent was wrongly splitting the wage structure of the employees and treating the reduced wage as the basic wage to the detriment of the employees, thereby evading its liability to contribute the correct amount towards provident fund.

The contention was however rejected by the Appellant Tribunal and both the single and division bench as well.

Appearing for the appellant, the learned ASG submitted that for the purposes of determining the basic wage under the EPF Act, reference must be made to the definition of the expression ‘minimum rate of wages’ under Section 4 of the Minimum Wages Act, 1948. 

The Court, however, was in consonance with the impugned judgment that there was no compulsion to hold the definition of ‘basic wage’ to be equated with the definition of ‘minimum wage’ under the Minimum Wages Act, 1948.

Read Order @LatestLaws.com:

Picture Source :