Indian Polity · Polity
Consider the following statements regarding the Code on Wages, 2019 and social security contributions: Statement I: Under the Code on Wages, 2019, employers can structure remuneration with higher allowances beyond 50% of total pay to reduce provident fund and gratuity liabilities, provided the basic pay remains above the notified minimum wage. Statement II: The Code on Wages introduces a uniform definition of 'wages' that caps the proportion of allowances in total remuneration for the purpose of calculating statutory social security contributions. Which one of the following is correct in respect of the above statements?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both Statement I and Statement II are correct, and Statement II is the correct explanation for Statement I.
- 2Both Statement I and Statement II are correct, but Statement II is not the correct explanation for Statement I.
- 3Statement I is correct, but Statement II is incorrect.
- 4Statement I is incorrect, but Statement II is correct.✓
Correct answer
Statement I is incorrect, but Statement II is correct.
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