Classify payroll components under the Code on Wages, 2019 and test your salary structure against the 50% wage floor.
Classify common payroll components against Section 2(y) of the Code on Wages, 2019. Each row shows the verdict, the statutory clause it rests on, and an audit-risk flag to guide review of the 50% wages floor.
Included heads count towards wages for the proviso (basic + DA + retaining allowance ≥ 50% of total remuneration). Excluded heads are listed in Section 2(y)(a) to (k). Conditional heads depend on how the component is structured in the salary letter and on documentation.
Search by component name or clause. Filter by verdict.
| Component | Verdict | Clause | Risk | Note |
|---|
Add your own components, using the classification above as a guide, and check whether the structure meets the 50% wages floor used for PF, gratuity and bonus purposes.
Type a component name (suggestions come from the 40 rows above) and choose how it is treated. Conditional heads need your own judgement based on documentation; the treatment is not locked.
| Component | Amount (₹) | Treatment |
|---|
Wages after the 50% rule add-back, if any.
Section 2(y), Code on Wages, 2019 (definition of "wages") with proviso and explanation.
The 50% rule: where excluded heads exceed one-half of the total remuneration, the excess is added back to wages.
Use the calculator above to test wage-floor compliance for a specific salary stack.
This reckoner is illustrative; verdicts must be tested against the actual salary letter and component definitions.
Book a free 30-minute compliance review and we'll walk through your actual payroll structure, Labour Code readiness, and statutory obligations.