Explained : Why the employers may have to revise offer letters As per the new definition of wages under the Code on Wages, 2019, the government has put a cap on the allowances at 50 percent of the total compensation. The experts, therefore, say this will entail higher costs for employers and a lower take home pay for employees. December 24, 2020 / 07:33 PM IST Payroll experts are of the opinion that employers may have to revise offer letters if the Code on Wages becomes effective from April 1, 2021. As per the new definition of wages under the Code on Wages, 2019, the government has put a cap on the allowances at 50 percent of the total compensation. The experts, therefore, say this will entail higher costs for employers and a lower take home pay for employees.