7Circumstances where part of salary or wages not to be treated as salary for purposes of Act

#### 7 Circumstances where part of salary or wages not to be treated as salary for purposes of Act (1) Where: (a) an allowance of a kind referred to in paragraph 5(j) or (k) is payable to an eligible employee; and (b) a part (in this subregulation referred to as the relevant part) of that allowance is payable to the eligible employee by reason of a reduction in, or the discontinuance of, the payment to the eligible employee of another allowance, not being an allowance of a kind referred to in regulation 5, that is or was payable to the eligible employee; so much of the salary or wages of the eligible employee as is equal to the amount of the relevant part of that allowance shall not be treated as salary for the purposes of the Act. (2) Where: (a) an eligible employee performs on a particular day duties or work in respect of the performance of which an allowance of a prescribed kind is payable to the eligible employee and that allowance is payable on a regular basis to the eligible employee; and (b) at any time during the relevant period an allowance of the same kind as the allowance referred to in paragraph (a) was payable to the eligible employee at a rate that is lower than the rate at which the allowance referred to in paragraph (a) is payable; so much of the salary or wages payable to the eligible employee on the particular day as is equal to the amount by which the amount of the allowance referred to in paragraph (a) exceeds the amount of the allowance that would be payable to the eligible employee on the particular day if he or she had continued to perform those duties, or that work, performed by him or her during the relevant period in respect of which an allowance of the same kind as the allowance referred to in paragraph (a) was payable to him or her at the lower or lowest rate, as the case may be, shall not be treated as salary for the purposes of the Act. (3) In this regulation, relevant period, in relation to an eligible employee who performs on a particular day duties or work in respect of the performance of which an allowance of a prescribed kind is payable, means: (a) if paragraph (b) does not apply—the period of 12 months immediately preceding the particular day; or (b) if the eligible employee has, for a continuous period of less than 12 months immediately preceding the particular day, performed the duties or work performed by him or her on the particular day or duties or work in respect of the performance of which an allowance of the same kind as the allowance payable to him or her on the relevant day has been paid or is payable to him or her—that lesser period.