As per the Wage code - Excess of 50% of total remuneration to be added back to the wages. The only exclusion are gratuity (clause j) and retrenchment pay (clause k).
Variable pay is neither in the inclusive nor in the exclusive list but is part of the CTC or total remuneration to the employee.
Would request your views whether Variable Pay is to be included for the purpose of calculation of excess of 50%.
Is Variable Pay in CTC Counted as Wages Under Wage Code Section 2(y) 50% Threshold Rule? A company seeks clarification under the Wage Code on whether variable pay, which is part of cost-to-company (CTC) but neither expressly included nor excluded in the statutory wage definition, must be considered when determining if wages are below 50% of total remuneration, thereby triggering addition of the excess back to 'wages.' The query notes that only gratuity and retrenchment compensation are explicitly excluded. The sole reply in the forum does not address the legal issue and is irrelevant promotional content. (AI Summary)
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