New Labour Law in India 2022 PDF Summary
Dear readers, here we are providing New Labour Law in India 2022 PDF to all of you. New Labour Law has been updated from the last once with some of the new amendments and in the law so that it can ben reliable as per the modern time. If you also want to learn about it in detail then you can stay here.
The Central government plans to implement new labour codes on wages, social security, occupation safety, industrial relations, health and working conditions from July 1. If implemented, the new wage code will change your salary in many ways. These laws will affect your salary structure, PF contribution, working hours, and earned leave encashment, among other changes.
New Labour Law in India 2022 PDF – Overview
- The Ministry of Labor is ready with the rules of 4 codes and mentions them when some states will be ready for the guidelines applicable in their domain. Jammu and Kashmir have notified the rules, while Uttar Pradesh, Bihar, Uttarakhand, and Madhya Pradesh have drafted laws for two codes and Karnataka has framed rules for one code.
- One of the biggest impacts of the new labor law will be on take-home pay, which is expected to come down, due to the fact that the government is eyeing increasing contributions to the provident fund (PF) and other post-retirement schemes Have happened.
- The new law is expected to go into effect soon, which will force employers to revise their employee compensation. As per the Wage Code 2019, the wages paid to an employee include basic pay and dearness allowance (DA) and retention payments.
- Therefore, other remunerations like PF contribution, bonus, pension, HRA, gratuity, overtime, etc. do not come under the definition of wages.
Basic Pay to be 50 Percent of CTC
The new pay code makes it mandatory for organizations to ensure that 50 percent of CTC of employees is basic pay, while the remaining 50 percent includes other employee allowances including house rent, overtime, etc.
If the company pays any additional rebate or allowance which is more than 50 percent of the CTC, it will be treated as remuneration to be added to the remuneration.
Gratuity Cost of Companies to Increase
The new labor laws limit the maximum basic pay of CTC to 50 percent, thus effectively increasing the gratuity bonus to be paid to the employee.
Under the new pay code, the gratuity amount will be calculated on a larger pay basis, which will include basic pay and allowances like a special allowance on pay. This is expected to increase the gratuity cost of the companies. While increasing the Social Security (pension) component of pay, the new laws are expected to reduce employees’ take-home pay.
Employment Law Over India 2022-23 – Four Broad Labour Codes on Wages
With the new law, the government is all set to amalgamate 44 central labor laws into four board labor codes, which are – Code on Wages, Industrial Relations; Occupational safety, health and working conditions (OSH), and social security. It has already got the assent of the President.
While the Code on Wages was passed in Parliament in 2019, the other three codes were approved by both the Houses last year. The Labor Ministry is now all set to implement the new rules under these four labor codes.
15 Minutes Overtime Payment
There is also a rule incoming for any 15 minutes or more overtime will be attracting overtime payment to the employees.
48 Hours Set Work Time for One Week
The government has also made it clear that 48 hours is the maximum limit for a one-week work capacity and the employers are flexible to choose this work time and make it available in 4 days, 5 days, or 6-day week structure.
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