Variable dearness allowance (VDA) is the part of the minimum wage that moves with consumer prices. As prices rise, VDA rises with them, so that the real value of the minimum wage is protected.
The Uttarakhand Labour Commissioner has issued the VDA rates applicable from 1 October 2026 to 31 March 2027. The formula behind these rates is clear enough for employers to verify independently, which makes it worth understanding how the figures are arrived at.
VDA for the 57 Scheduled Employments
For the 57 scheduled employments, the state adjusts VDA at ₹57.60 for every point by which the All India Consumer Price Index (2016=100) exceeds 139.
The calculation for this period works as follows:
- Base index: 139
- Average index for January to June 2026: 150
- Difference: 11 points
- VDA: 11 × ₹57.60 = ₹634 per month (rounded)
This amount of ₹634 a month applies uniformly across all categories of workers.
The schedule covers a wide range of establishments, including:
- Shops and commercial establishments
- Hotels and restaurants
- Dairies
- Plastics
- Private clinics
- Many other scheduled employments
VDA for Engineering Establishments (50+ Workers)
For engineering establishments employing 50 or more workers, the calculation differs. Here, VDA is linked to the base wage of each category rather than being a flat amount.
- Threshold index: 425
- Average index: 431
- Difference: 6 points
- Formula: VDA = 6 × base wage ÷ 425
For an unskilled worker on a base wage of ₹13,800, this gives approximately ₹195, resulting in a monthly minimum wage of ₹13,995.
The corresponding monthly totals for other categories are:
- Unskilled: ₹13,995
- Semi-skilled: ₹15,313
- Skilled: ₹17,139
What This Means for Employers
VDA is a recurring payroll item
VDA is revised every six months. It should be treated as a fixed item in the payroll calendar and not as a one-time adjustment.
The applicable figure depends on the establishment
The VDA that applies depends on the type and size of the establishment. An organisation with different kinds of units in the same state should confirm which notification governs each one.
Conclusion
Uttarakhand's VDA revision for October 2026 to March 2027 follows a transparent formula linked to the All India Consumer Price Index. For most scheduled employments, the result is a flat ₹634 a month, while engineering establishments with 50 or more workers apply a separate, wage-linked calculation.
Employers should verify which notification applies to each unit, update payroll from 1 October 2026, and plan for the next revision in six months.