The draft labour law which is likely to come into effect from 1st
Oct 2021, which comprises the basic pay requirement, change in working hours,
etc.,
The four new codes on industrial relations, wages, social security and occupational health safety (OSH), and working conditions will rationalise 44 central labour laws. Union Ministry is set to implement several changes in the rules of labour law from October 1, 2021.
According to new labour law..
1. The working hours of employees are going to be increased from 9 hours
to 12 hours (4 working days instead of working for 5 days in a week).
2. Impact on PF, Gratuity, Social security contributions due to the
condition of maintaining basic pay as 50% of actual salary as mandatory.
The existing provisions
of the new rules will lead to an increase in working hours for employees from
nine to 12 hours, while the in-hand salary will also see a change. Under the
new wage code, allowances have been capped at 50 per cent, which will lead to
half of the monthly pay being calculated as basic wage. Provident fund (PF)
contribution is calculated as a percentage of basic wage, which includes basic
pay and dearness allowance. Increase in basic pay will result in an increase in
the PF contribution, which will reduce the take-home pay for workers. The PF
liability for employers will also increase in many cases.
The new code will allow organisations to let their
employees work for four days instead of the currently mandated five if
employees are working for 12 hours a day.
The Centre has also proposed a provision for free
medical check-ups for workers through the Employees State Insurance
Corporation.
- VJ
