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Check out how India’s new wage ‘labour’ code will benefit you in 2022?

New labour laws will go into effect nationwide on July 1. Your pay, working hours, and weekly vacation time may all be affected. The four codes pertaining to pay, social security, labour relations, and workplace safety have been finalized by the Center. The states must now put them into effect. In accordance with the code, the responsible corporation is required to make the complete and final payment of arrearages within two days of the employee’s last day of employment. “The four labour codes are likely to be implemented in the next financial year of 2022-23 as a large number of states have finalized draft rules on these. The Centre has completed the process of finalizing the draft rules on these codes in February 2021. But since labour is a concurrent subject, the Centre wants the states to implement these as well in one go”, As stated by officials in December.

Date of Implementation of New Wage Code

It is anticipated to go into effect on July 1st, 2022. The take-home pay would decrease after the new codes went into effect as the PF contribution would increase. Additionally, the four-day workweek is probably going to be adopted. Since the Labour Ministry made it apparent that a 48-hour workweek is a necessity, employees may be required to work 12 hours a day.

Fully and finally paid under the new wage code of 2022 in just two days

Businesses often pay the full settlement of salaries and other obligations 45 to 60 days after an employee’s final day of work, and in some situations, up to 90 days afterward. The full and final settlement of wages and obligations, however, must be made by the employer within two days after the employee’s last day of employment or service, as per the new regulations. According to the new salary code under the labour legislation, “The wages owing to him should be paid within two working days after his removal from employment, dismissal from service, retrenching from service, resignation from service, or becoming jobless as a result of the closing of the establishment,” states the policy.

2022’s New Labour Code: Shifts in Working Hours

Three weeks of vacation time would be granted to employees under the new labour laws. Any employee would only be required to labour for a maximum of 48 hours. This implies that employees who put in eight hours a day will only receive one week off. But those who put in 12 hours a day will be granted three weeks off. 9-hour shift workers will receive two weeks off. Additionally, the new labour laws permit an increase in the maximum number of overtime hours from 50 (permitted by the Factories Act) to 125 (permitted by the new labour codes) in a calendar quarter across all industries.

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What effects will the new pay code have on salaried workers?

1. The new wage law will affect your pay. Following the introduction of the Wage Code, your in-hand salary will decrease.

2. The take-home pay might decrease as a result of the government’s Code on Wages 2019 announcement, whereas components like PF could increase depending on a number of circumstances.

3. A new pay code will affect the allowance component of your compensation.

4. Additionally, if the aforementioned clause is put into action, employees won’t be allowed to receive more than half of their net monthly wage in the form of benefits.

5. PF will be greater following the introduction of the new wage code.

6. Additionally, the employee’s PF contribution will increase as a result.

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7. A longer working hour may result from the new wage rule, although in such case, your week off would be longer than two.

8. Despite the 48-hour workweek requirement, the number of days off each week may vary based on the workload.

9. There may be significant changes to the Earned Leave policy following the introduction of the new pay law.

Defense workers now have 60 holidays in a year, compared to 30 for government agencies. Employees are permitted to carry forward up to 300 holidays for pay, but the labour union is pushing for a new regulation to boost the number of holidays to 450.

The Wage Code now includes a new leave policy.

For female employees, maternity leave will now last for 26 weeks. They cannot be put on the night shift against their will by the employer. The right facilities and security must be provided. As was also previously indicated, the Earned Leave Policy may be most affected. From 2022 to 2023, employees in India could be able to take advantage of a four-day workweek as compared to the existing five-day workweek. Depending on the number of working hours, weekly offs could be given. If this code is put into effect, the workforce will have access to leaves every 180 days as opposed to 240 days previously.

The new labour code, therefore, offers significant benefits to employees. While some individuals believe that some rules need to change, others are eagerly awaiting their implementation. The COVID-19 pandemic-era work-from-home policy is also discussed in the revised regulations. The purpose of the new regulations is to enhance employee welfare.

So what do you think about the proposed changes? Do let us know in the comments and also follow us for more informational content.

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