New labour laws likely to affect CTCs, take-home salary may come down
The new laws will prompt companies to restructure the CTC as they cap several allowances including LTA, house rent, overtime and conveyance at 50%. Representative image
Updated: Feb 15, 2021, 09:01 AM IST
The Ministry of Labour and Employment is likely to complete the process to finalise the rules for four new labour codes or laws soon and they are likely to be implemented from the coming fiscal year. While there are proposals about four-day week and overtime limit, one thing that will directly affect the salary of employees is the impact of Cost-to-company (CTC) and the take-home pay.
New labour codes to affect employees in-hand salary, companies wage bill
While the new definition of wages will increase the social security component of compensation packages, it could also mean lesser take-home salary for employees
BusinessToday.In | February 15, 2021 | Updated 15:26 IST
Rules for new labour codes to be notified soon
The central government is set to notify the rules under new labour codes, which will have an impact on employees cost to company (CTC) as well as employers wage bills. Employers will have to modify the employee compensations once the extensive labour reforms come into play to accommodate the new definition of wages. Expected changes for employees include higher post-retirement benefits, while decline in take-home salaries. Employers are likely to see increased outgo towards provident fund (PF) and gratuity contributions.
Centre To Allow 4 Day Work Week, Shift Hours Will Increase Feb 10, 2021, 16:32 IST
The Ministry of Labour and Employment are planning for a new labor code. These codes will have the company make decisions for a possible four day work week. But the hours will remain the same. So a worker will have to stay for a longer shift to complete 48 hours of service.
Labour and Employment Secretary Apurva Chandra spoke about the suggestion given by the Trade Union. She said that the government is planning to approve the 12 hour daily shift with three days as Weekly off. If a person is working for 4 days a week then the working hours will be 12. But if it is six days, then the daily hours will be reduced to 8.
Labour ministry clarifies on four labour codes ILO compliance
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“The ILO has not commented about India’s lack of compliance with ILO Convention - 144 on tripartite consultations in implementing the four Labour Codes,” labour minister Santosh Kumar Gangwar said in response to a question in Rajya Sabha.
How will the new labour codes impact you? Key provisions decoded
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The labour ministry, on Tuesday, clarified that the International Labour Organisation has not commented on India’s lack of compliance while finalising the four labour codes.
“The ILO has not commented about India’s lack of compliance with ILO Convention - 144 on tripartite consultations in implementing the four Labour Codes,” labour minister Santosh Kumar Gangwar said in response to a question in Rajya Sabha.
New Labour Codes May Allow 4-day Work Week But With Longer Hours
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The Union Ministry of Labour and Employment is working to roll out new labour codes, where it proposes flexibility to companies to reduce the number of working days to four days a week and provide free medical check-ups to workers through state insurance. However, the cap on working hours of 48 hours per week will remain sacrosanct.
Companies will have to give three days’ of paid leaves and 12 hours of work per day to their employees with the consent of the workers, said Labour and Employment Secretary Apurva Chandra said on Monday.