Unlocking the Mechanics of Variable Dearness Allowance: A Detailed Insight

In a recent notification issued by the Government of Rajasthan, the Labour Department shed light on the recalibration of Variable Dearness Allowance (VDA) according to the recommendations of the Engineering Wage Board. The shift to a new series of Consumer Price Index Numbers (CPI) with a with a base year of 2016 = 100, effective from September 2020 onwards, triggered the need for adjustments. Due to the discontinuation of the old series, linking factors were utilized to compute the CPI base year of 1949 = 100 for the period spanning October 2023 to March 2024. Through meticulous calculations, the average CPI for this period was determined to be 6658, translating to an average of 1109 when rounded off. This signifies a notable increase of 155 points from the previous period’s average, underscoring the evolving economic landscape impacting industrial workers. This notification was published on June 11, 2024.