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Dear Debojit,
There is no restriction for reduction in Basic as a percentage of the total salary.
But the Employees Provident Fund Act, restrict reduction in Basic Salary in amount terms (in rupee terms).
thus us can go ahead in reduction of Basic in percent terms but not in amount terms.
Hope this clarifies.
regards
Nishant Srivastava

Mr.Roy
we can not reduce the basic because its the part of Minimum wages act 1948-that is statury compliance under act

Dear Dabajit
Now u can't reduce the % of basic salary. You have to fix the % of basic salary in your HR manual. You have to inform your emplyoee about changes in the salary components.
Thanking You,
Smanisha

Dear Mr. Debajit,
Keeping aside all legal jargons regarding this matter, reduction in basis salary may be possible if there is no Standing Order / Service Rules / Bipartite or Tripartite Settlements in operation in your organisation ; even these or any of these exist there is no provision against reduction in basis salary of employees .

All we have to do is to ensure that after reducing basis salary there is substantial increase in one’s take home per month. This may be done through maneuvering
other components of salary package e.g. LTA / Medical / Mediclaim / Insurance / Attire / Communication Allowances / Retention Bonus / Soft Furn . / etc.

However, it is always advisable to take into confidence all concerned employees by HR. Personnel through suitable means before venturing into reduction in basis salary of employees.

Regards,
Manoj


PS. Government Organizations will not come under the above purview.

hi dear,
It will be affecting statutory compliances, gratuity, bonus, EL. Over and above this amounts a punishment and against conduct & discipline rules that have been finalised in line with Employees Model standing orders which are statutory. ensure whether it is not applicable.
gln

You can reduce the Basic Salary of the employee in order to restructure the salary for whatever reason you have. all have to make sure is that you are not reducing the salary below minimum wages. There is no rule in law where you can not reduce the salary.
Regards,
Ritesh Kumar Gupta