We are a public Junior High School with 35 employees and registered with EPF and ESI. As you know, EPF limits has been enhanced from 6500/- to 15000/- w.e.f. 01/09/14, below is my query -
Ex. One of our Employee has been working with us at Rs. 10000/- per month (Basic + DA). Before 1-Sep, his CTC per month to us is 10418/- (Basic + DA + ESI employee + ESI employer). Now from 1-Sep. can we re-structure his Salary as follows -
Basic + DA = 8800/-
EPF employee = 1056/-
ESI employee = 154/-
Salary payable = 7590/-
Revised CTC per month = 10424/- ( Basic + DA + EPF employer +ESI Employer)
Can we do this? or We need to bear the additional 13.71% of earlier Basic+DA ourself?
One of our advisor advised against doing so since we are decreasing the salary of the employee which is not permissible and Labour Inspector will term it as willful manipulation. But my argument is we are not decreasing the CTC per month by doing so.