Difficulty: Medium
Correct Answer: There is no fixed statutory minimum period for revising basic salary; revisions depend on company policy, bargaining agreements, and market conditions, although many organisations review salaries annually.
Explanation:
Introduction / Context:
Employees are often interested in how frequently their basic salary can or should be revised. Interviewers may ask this question to check whether a candidate understands the difference between statutory requirements and company level practices. The key point is that, in many jurisdictions, labour laws set minimum wage levels and conditions but do not mandate a fixed time interval for basic salary revision for every employee.
Given Data / Assumptions:
Concept / Approach:
In most environments, there is no universal legal rule that basic salary must be revised after a fixed minimum period such as six months or one year. Instead, laws focus on ensuring that wages do not fall below statutory minimums and that contractual terms are honoured. Salary revision cycles are usually defined in company policies, collective bargaining agreements, or employment contracts. Some companies conduct annual increments, others may have mid term promotions or market adjustments, and in difficult times salary increases may be deferred. Therefore, the most accurate general statement is that there is no fixed statutory minimum period for revision; it is governed by policy and agreements.
Step-by-Step Solution:
Step 1: Distinguish between legal requirements about wages and internal company decisions about increments.Step 2: Recognise that labour laws commonly prescribe minimum wages and conditions but do not enforce a fixed schedule for salary increases for all private employers.Step 3: Note that most companies choose an annual salary review cycle, but this is a management choice rather than a legal minimum period.Step 4: Review the answer options and find the one that states there is no fixed statutory minimum period and that revisions depend on company policy and agreements.Step 5: Select option A because it accurately reflects the general situation, while options B, C, and D describe unrealistic or incorrect rules.
Verification / Alternative check:
Looking at different industries, you will observe a variety of practices. Some companies give annual increments linked to performance ratings, others follow wage agreements negotiated with unions every few years, and some may freeze salaries during economic downturns. If there were a rigid legal minimum period requiring monthly or daily revision, such widely varying practices would not be possible. This practical observation supports the statement that there is no fixed statutory minimum period for revising basic salary.
Why Other Options Are Wrong:
Option B claims that basic salary must be revised every month, which is not practical and not supported by labour laws in most jurisdictions. Option C suggests that basic salary can never be revised once set, which contradicts common practice of increments, promotions, and market corrections. Option D proposes daily revision, which is clearly impossible and would make payroll unmanageable.
Common Pitfalls:
Some candidates assume that because many companies review salaries once a year, this must be a legal requirement, which is not correct. Others may confuse minimum wage notifications, which update legal wage floors periodically, with mandatory salary revision schedules for all employers. To answer correctly, remember that basic salary revision frequency is usually a matter of policy and negotiation, not a fixed statutory minimum period.
Final Answer:
There is no fixed statutory minimum period for revising basic salary; the revision cycle depends on company policy, bargaining agreements, and market conditions, although many organisations review salaries annually as a matter of practice.
Discussion & Comments