July 12, 2024
Business Featured Latest News

Salary, Complete and Final Settlement Within 2 Days, Declares New Wage Code

According to the new wage code, a corporation must pay an employee’s full and final settlement of earnings and dues within two days of their last working day following their resignation, dismissal, or departure from employment and services.

Businesses often pay the full settlement of salaries and other obligations 45 to 60 days after an employee’s last day of work, and in some situations, up to 90 days afterwards.

The four labour codes—pay, social security, labour relations, occupational safety, health, and working conditions—are India’s most recent reform, which the parliament has already approved.

The new wage code under the labour law states that “the wages payable to him shall be paid within two working days of his removal, dismissal, retrenchment, or, as the case may be, his resignation” when an employee has been I removed or dismissed from service; or (ii) retrenched or has resigned from service, or (iii) became unemployed due to closure of the establishment.”

The existing 29 Central labour laws were examined and combined to create the four new labour regulations. Although the government wants to put these new laws into force by July 1, many states have not yet ratified them, which is required under the constitution because labour is on the concurrent list.

In his written reply to the Lok Sabha, Minister of State for Labour and Employment Rameshwar Teli stated that only 23 states and union territories (UTs) had made the draught Code on Wages guidelines available.

Businesses would need to adjust their payroll operations if the wage code were to become law, working around the deadlines and methods for determining the full settlement of salaries within two working days.

However, the legislation also gives individual states the option to determine their own full and final settlement timelines depending on what they deem to be reasonable.

According to the new legislation, businesses are permitted to extend the standard workday from 8 to 12 hours.

They will have to provide the workers with three weekly days off, nevertheless. Thus, the number of working days per week will be reduced to four, but the number of working hours per week as a whole will remain the same. A total of 48 hours must be worked each week according to the new wage regulation.

The take-home pay of the employees will also alter dramatically since, under the new wage code, the basic compensation must be at least 50% of the gross monthly payment.Additionally, this would result in higher PF contributions from both employees and employers, which will have a greater impact on private sector employees’ take-home pay. The retirement corpus and gratuity amount will rise in accordance with the new labour legislation.

Picture Courtesy: Google/images are subject to copyright


Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *