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Central Govt Employees: Centre Hikes Variable DA; PF, Gratuity Set to Increase

Variable DA hike will also result in an increase in rate of minimum wages for central sphere employees and workers

Variable DA hike will also result in an increase in rate of minimum wages for central sphere employees and workers

Variable dearness allowance hike: The revised rate of variable dearness allowance or VDA will benefit 1.5 crore workers

In a bid to provide some relief to central government employees amid the second wave of coronavirus pandemic, Centre has recently hiked the rate of variable dearness allowance (VDA). The dearness hike ranges from ₹105 to ₹210 per month. The revised rate of variable dearness allowance or VDA will benefit 1.5 crore workers. The labour ministry said it has notified and increased the rate of DA with effect from April 1, 2021.

“It will be for scheduled employment in central sphere and applicable to the establishments under the authority of central government, railway administration, mines, oil fields, major ports or any corporation established by the central government. These rates are equally applicable to contract and casual employees/workers," the ministry of labour & employment said in a statement.

“This will benefit about 1.50 crore workers engaged in various scheduled employments in central sphere across the country. This hike in variable dearness allowance will support these workers particularly in the current pandemic times," said Santosh Gangwar, labour and employment minister.

“The variable dearness allowance is revised on the basis of average consumer price index for industrial workers (CPI-IW) a price index compiled by labour bureau. The average CPI-IW for the months of July to December 2020 was used for undertaking the latest variable dearness allowance revision," the labour ministry added.

The hike will also result in an increase in rate of minimum wages for central sphere employees and workers."The enforcement of Minimum Wages Act in the central sphere is ensured through the inspecting officers of Chief Labour Commissioner (Central) across the country for employees engaged in the scheduled employment in the central sphere," labour ministry added.

“It is a welcome relief for applicable central government employees in this time of raging second wave of pandemic. This will also result in increase in the provident fund, gratuity and other benefits directly linked with DA," said Subodh Sadana, Partner, AnantLaw.

“This move will enable the community workers to cope with the increased cost of living due to inflation and support their families," said Suraj Malik, partner, BDO India LLP.

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first published:May 24, 2021, 12:11 IST