Timely wages, higher basic pay, health checkups, Pg11

Key Highlights:

• New labour codes aim to create a uniform structure for wages, bonus, and wage-related matters, emphasizing equal remuneration for equal work.
• Wage definition includes basic pay, dearness allowance (DA), and retaining allowance (RA), excluding bonus, HRA, travel allowance, and gratuity.
• The Code on Wages mandates that deductions cannot exceed 50% of wages, implying a higher basic pay component.
• A National Floor Wage will be fixed by the Centre to define the baseline for wages across the country, ensuring no state fixes minimum wage below it.
• Employers must pay wages to daily wagers at the end of shift, weekly wagers before the weekly holiday, and monthly wagers within 7 days of the next month.
• Overtime wages must be at least twice the normal wage rate for work beyond normal working hours.

Detailed Insights:

• The new labour codes consolidate and streamline existing labour laws, aiming for simplified compliance and improved labour standards.
• The definition of wage under the new codes impacts social security contributions like PF, gratuity, maternity benefits, and bonus, which will be based on a larger portion of pay.
• The floor wage aims to reduce wage disparity across states and benefit casual employees, daily wagers, and migrant labourers.
• The codes ensure minimum wages are paid to all employees regardless of wage ceiling, whether in the organised or unorganised sector, providing a uniform legal safeguard.
• Working hours can range from 8-12 hours daily, with a weekly cap of 48 hours, and employers must provide a paid day of rest every 7 days.
• Fixed Term Employment (FTE) allows employers to hire workers directly under a fixed-term contract, adjusting the contract length based on industry seasonality.

Key Concepts Involved:

• Wage: Includes basic pay, dearness allowance, and retaining allowance, used to calculate social security contributions.
• Floor Wage: A minimum wage level set by the central government, below which states cannot set their minimum wages.
• Fixed Term Employment (FTE): Hiring workers for a specific period under a contract, allowing flexibility based on industry needs.