Employee working hours, salary structure likely to change from April 1; know how new wage code will affect you
New Delhi | Jagran Business Desk: The new financial year is going to start from April 1 and with the start of the new fiscal, several changes will also take place. The biggest among the changes will be the change in employees' working hours and their salary structure. The government is planning to increase the working hours to 12 hours from the current 9 hours. However, with the increase in working hours, the government is also likely to reduce the number of working days to four days a week.
The changes, expected to come into effect from April 1, is also likely to include the change in employees' salary structure with an increase in the gratuity and provident fund and a decrease in take-home salary.
This comes as the government had in 2020 passed three wage code bills in Parliament. These three laws can now be implemented from April 1, 2021. If this happens, the take-home salary of the employees will be reduced. Also, its effect will be on all the employees and the employer. The balance sheet of private companies will also be affected by this new rule.
These changes will happen with the new wage code
- Under the new definition of Wages, the allowances will be a maximum of 50 per cent of the total salary.
- The central government claims that the new law will benefit both employers and workers.
- According to the new rules, now the basic salary should be 50 per cent or more of the total salary. In this case, the structure of the salary of the employees will change.
- Since the provident fund is based on the basic salary, the PF will increase with the increase in the basic salary, which means that there will be a cut in the take-home salary or in-hand salary.
- Increase in the gratuity of employees and contribution to PF will increase the amount received after retirement.
- The new draft law proposes to work for a maximum of 12 hours.
- According to the rules, more than 5 hours of continuous work is prohibited from any employee.
- The employees have been instructed to give 30 minutes rest after every 5 hours.
Posted By: Talibuddin Khan