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 Laws: Latest update on wages for working overtime
India
Published: Monday, February 15, 2021, 11:23 [IST]
New Delhi, Feb 15: The government is preparing to implement a new Labour Law and once it comes into effect, there would be improved rules for the country s labour market.
According to a Hindustan Times report, the government may change the existing time limit of overtime under the new law and working more than 15 minutes beyond the scheduled hours will be considered as overtime.
The companies will have to pay their employees for this. This would mean that an employee would be paid overtime if he or she works even 15 minutes more than the scheduled work hours.
Companies will not be allowed to increase workings hours beyond mandated 48-hour limit for week. They will also need to ensure employees get three days of consecutive holidays after that, says Labour secretary Apurva Chandra
Synopsis
Under the new labour laws, the definition of wages is standardised. This will impact on how gratuity and EPF will be calculated and lead to hike in amount and individual is eligible to receive.
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The year 2020 ended with hope for a better 2021 in all facets of our lives - economic, social and health. The novel coronavirus pandemic hit the Indian economy adversely impacting almost all sectors be it agriculture, aviation, manufacturing or the service sector. All eyes are now set on Budget 2021 with the hope that taxpayers will be given some respite. Every year the Budget attracts lots of expectations, but Budget 2021 will be more important from the perspective of the remedial actions that will be taken by the Finance Minister to revive the economy.