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From Salary, Working Hours and Weekly off. The Central Government has updated 29 existing Labour Laws and introduced four new Labour Laws codes. The New Labour Law codes were implemented on 1st July 2022. With this, there is a major change and impact in all industries and sectors. However, there is no official notification issued by the Central Government in this regard.
The new labour laws were implemented on 1st July 2022 and are applicable to all corporates and organizations having registration with the ministry of corporate affairs.
Q1. To whom these new rules are applicable?
According to the Government’s booklet on New Labour Codes “Employees’ Provident Fund (EPF), Employees’ Pension Scheme (EPS) and coverage of all types of medical benefits under Employees’ Insurance will be applicable to all workers.” It means it applies to both i.e., employees working in organized or unorganized sectors.
Q2. How do these new rules impact the working hours and days?
The Company at its own discretion can implement four, five or six working days for its employees. The new wage code requires a 48-hour working week. Hence, the existing daily limit is 9 hours. It means if an employee works for 4 days instead of 5 days a week, the number of working hours will substantially increase.
Q3. How do these rules impact the leaves?
The Factories Act has currently provided a provision of annual/earned leave of 12 working days for all the workers who have worked at least 240 days in a year. This has now been reduced to 180 which means a new employee can take a leave of absence after working for 180 days instead of 240 days. Government Employees can take 30 holidays in a year and defence employees would get 60 holidays in a year.
Q4. What are the special benefits for a women Employee?
The maternity leaves for female employees will increase to 26 weeks. Also, companies cannot ask them for a night shift without their consent. If they are working then proper facilities and security must be provided by the Employer.
Q5. How do these new rules impact the Provident Fund?
As per the newly implemented code, the take-home salary will be reduced as a contribution to the Provident Fund will be increased. As per the new codes, the basic salary of an employee will at least be 50 per cent of their gross salary. This will lead to an increase in the PF contribution made by employees and their employers.
Q6. Is there any impact on the Salary?
The most important and concerning issue for every working-class individual is, Is there any impact on my take-home salary after the implementation of these codes? Now, the new rules have fixed the basic salary of workers to be at least 50 per cent of their gross salary. 50 per cent of the gross salary should be towards basic wages (Basic Pay and Dearness Allowance). The ceiling on the allowances will be 50 per cent of the gross salary which means Employers will have to ensure that deductions made from the salary relate to specifically permissible deductions (such as contribution to Provident Fund, tax deduction at source (TDS), etc.) and that the total deduction in any month should not exceed 50% of wages.
Conclusion: The new Labour code has brought many advantages for the employees. The new rules also talk about Work from home which was implemented during the COVID-19 pandemic. The new rules have been drafted to improve the well-being of employees which means Companies are required to have some basic principles and policies in place regarding Work From Home to ensure that the work-life balance is not affected and this will going to be very beneficial for the employees working from home.
Article By: Ms Bhavya Sharma, a Practising Company Secretary from Delhi. In case you need any assistance in filing of documents in the above-mentioned scheme or any related queries you can connect with us. You can contact us at legal@bhavyasharmaandassociates.com or for more details you can visit: www.bhavyasharmaandassociates.com
Disclaimer: Although due care and diligence have been taken in the preparation and uploading of this Article, Bhavya Sharma & Associate shall not be responsible for any loss or damage, resulting from any action taken on the basis of the contents of this Article. Anyone wishing to act on the basis of the material contained herein should do so after cross-checking with the circulars, notifications, applicable acts, and press releases issued by the concerned department or seek appropriate counsel for their situation.
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