The term subsistence allowance refers to the allowance which is
paid to a workman1 when he is suspended due to
allegations of misconduct, and the investigation or inquiry into
the allegations of misconduct is pending. The nexus behind
providing this allowance is two-fold, one is to ensure that the
suspended workman and his family do not face economic hardship
during the pendency of inquiry, and on the other hand it also
ensures that the employer completes the inquiry process timely and
without any unnecessary delay.
Although the term subsistence allowance has not been defined in
the statute, however, Section 10-A of the Industrial Employment
(Standing Orders) Act, 1946 lays down the guidelines and
circumstances when an employer is required to pay subsistence
allowance to the workman and it states the following:
