Karnataka increases consumer price index. Will impact employee’s dearness allowance
The Government of Karnataka has increased the base consumer price index effective from April 01, 2019 by 162 points. Employers will need to multiply this with the applicable rate of dearness allowance and 30 in order to determine the monthly variable dearness allowance that their employees will be entitled to.
Consumer price index is a measure of the change in prices of basic consumer goods and services purchased by households.
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- The increase in consumer price index will increase the amount of dearness allowance that employees will be entitled to. Employers will need to be aware of this as it will become effective from the coming months. Non compliance of this can lead to a fine of ₹ 500 and/or imprisonment up to a term of 6 months.
Labour ministry reiterates that ceiling of gratuity has been increased from ₹ 10 Lakhs to ₹ 20 Lakhs
The Ministry of Labour and Employment (“Labour Ministry”) has released a press note reiterating an earlier notification stating that the ceiling of gratuity as stipulated under Section 4(3) of the Payment of Gratuity Act, 1972 (“PG Act”) has been increased from ₹ 10 Lakhs to ₹ 20 lakhs.
The ceiling on gratuity is the maximum amount of gratuity an employee is entitled to as per the PG Act.
Although the ceiling has been increased to ₹ 20 lakhs, employees who are entitled to more than ₹ 20 lakhs of gratuity will still be governed by the PG Act. This has been provided in Section 4(5) of the PG Act which was recently upheld by the Delhi High Court.
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- Although this change was brought in last year by the Labour Ministry, this reassurance will be welcomed by millions of employees across the country who will be impacted by this increase in ceiling.
Labour Ministry notifies the Payment of Bonus (Amendment) Rules 2019. Filings to be done electronically
The Ministry of Labour and Employment (the “Labour Ministry”) has notified the Payment of Bonus (Amendment) Rules, 2019 (the “Amendment Rules”). The Amendment Rules require all employers to upload their unified annual returns electronically on the Labour Ministry’s web portal by the 1st of February every year. Earlier, employers were required to file physical copies of their annual returns with the inspector within 30 days of paying bonuses to their employers.
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- This move essentially means that entities will no longer be able to file any physical annual returns with the inspector and that all filings will need to be done electronically through the web portal of the Labour Ministry. Although this may help entities in major cities in filing their annual returns, entities in rural areas with no access or limited access to the internet, may find the Amendment Rules as an additional burdensome compliance to deal with.
Del HC restrains entity from airing false and misleading advertisements
The Delhi High Court (“Del HC”), in the case of TATA Chemicals Ltd v. Puro Wellness Pvt Ltd, issued a restraining order preventing Puro Wellness Pvt Ltd from airing advertisements on print or digital media that degraded TATA’s product.
TATA Chemical’s Ltd claimed that the advertisements aired by Puro Wellness Pvt Ltd contained materials that were false, baseless, misleading, and gave the impression that TATA Chemical’s product was not fit for consumption.
The Del HC, reiterated its ruling in the Colgate Palmolive Company and Ors v. Hindustan Unilever Co, held that whilst puffery is permitted in advertising, disparagement and denigration is not. The Del HC accordingly, issued a restraining order against Puro Wellness Pvt Ltd.
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- This judgement of the Del HC will be welcomed by the public. It will, in our opinion, go a long way in ensuring that brands do not indulge in false advertising, therefore, giving the public a better idea of what the product is. We hope that brands fall in line and follow the principles laid down by the Del HC in this judgement.
Disclaimer: This post has been prepared for informational purposes only. The information/or observations contained in this post does not constitute legal advice and should not be acted upon in any specific situation without seeking proper legal advice from a practicing attorney.