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New Wage Code may be implemented from 1st October! Change in salary structure, holidays, pension and PF will also change

New Wage Code 2021: Take home salary, PF and Gratuity of a private job worker will change completely. In this code, the cash in hand salary of the private employer will decrease and the retirement fund will increase.

New wage code 2021: When will the new labor code or new wage code be implemented? Everyone wants to know the answer to this question. There are many speculations. A lot is about to change in the new wage code. There will be a lot of changes, especially for the employed and laborers. But, there is no clarity on the status of its implementation yet. The central government wanted to implement it from April 2021. It was postponed as the system was not ready at the state level. Then it was expected to be implemented in July. However, the government has not set any timeline for this after April. If sources are to be believed, the New Wage Code can be implemented from October.

Postponed due to non-preparation of draft rules

According to information received from sources by, the matter is stuck regarding the New Wage Code Draft rules. Many states have not yet sent their drafts. Until the draft rules are received from all the states, the central government will not notify it. At present, Uttar Pradesh, Uttarakhand, Punjab, Madhya Pradesh, Bihar and Jammu and Kashmir have published the draft rules. The draft rules for Haryana, Meghalaya, Chhattisgarh, Goa, Sikkim, Tripura and Jharkhand are in the final stages. In some drafts only 3 codes have been mentioned, the fourth code Occupational Safety, Health and working conditions is not mentioned. This is the reason why it could not be implemented yet. However, sources are skeptical on whether it will be applicable in October also.

New wage code may be implemented from October

If sources are to be believed, the central government is ready to notify the New Wage Code. The central government does not want to issue notifications without the consent of the states. The states have been given time till September 2021. New Wage Code 2021 can be implemented from October 2021 as soon as the draft rules are received. However, even after the publication of the draft rules, states will have to give 30-45 days to invite comments and suggestions from all the stakeholders. Based on the suggestions, the code will be finalized and then it can be notified.

What is the New Wages Code?

The government has made 4 new codes by combining 29 central labor laws. These include the Industrial Relations Code, Code on Occupational Safety, Health and Working Conditions Code (OSH), Social Security Code and Code on Wages. But, the biggest change is in the definition of ‘wage’. It has been expanded. The new labor code is aimed at consolidation. 50% of the salary will be directly included in the wages. Let us tell you, new laws related to labor reforms have been passed by the Parliament. Now to implement them.

How will the salary structure change?

According to the New Wage Code Act 2019, the basic salary of an employee cannot be less than 50% of the cost of the company (CTC). At present, many companies reduce the basic salary and give more allowances from above so that the burden on the company is reduced. With the implementation of the New Wage Code, the salary structure of the employees will change completely. The ‘Take Home Salary’ of the employees will decrease, because by increasing the Basic Pay, the PF of the employees will be deducted more, that is, their future will be more secure.

Rules of holidays, pension and working hours will change

According to EPFO ​​board member and Bharatiya Mazdoor Sangh general secretary Virjesh Upadhyay, social security is very important for employees. There are many important aspects to this. The rules have to be changed on important issues like working hours of employees, annual holidays, pension, PF, take home salary, retirement.

There will also be a change in PF, Gratuity

Contribution to gratuity will also increase along with Provident Fund. Take home salary will definitely decrease but the employee will get more amount on retirement. The New Wage Code 2021 will also be applicable for the employees of the unorganized sector. The rules related to salary and bonus will change and there will be equality in the salary of employees working in every industry and sector.

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @
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