New Wage Code 2022: Employees with Rs 25 basic pay people will get Rs 1.16 crore, check out this calculation

New Delhi: The four labour codes on wages, social security, industrial relations and occupation safety, health and working conditions which were likely to be implemented from July 1, did not kick in. However, the media is abuzz with a lot of speculations regarding Cost to Company (CTC), provident fund and gratuity.

Once implemented, the new wage code will purportedly impact working hours, salary restructuring and PF contribution, encashing of Earned Leaves among the prominent ones. Since these are early speculations, employees will have to wait till government officially notifies the rules.

New Wage Code 2022 gazette notification

Till now, 23 states have pre-published draft rules on these laws, while the Centre has completed the process of finalising the draft rules on these codes in February 2021. The central government has notified four labour codes, namely, the Code on Wages, 2019, on August 8, 2019, and the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 on September 29, 2020.

New Wage Code Implementation Date

Since labour is a concurrent subject, the Centre wants the states to implement these as well in one go, as has been reported earlier. Thought there is no official word on the new wage code implementation date, it is expected to kick in soon.

New Wages Act 2022

Meanwhile a report in the media states that if the basic pay of an employee is Rs 25,000 per month, and assuming that the employee has an annual increment of 5 percent, the amount of EPF on retirement will be Rs 1,16,62,366. In the same vein, if the basic pay of an employee is Rs 15,000 then post retirement the EPF fund will be Rs 65,36,758.

An employee's Cost to Company is an assimilation of various allowances along with the  basic pay. The pay structure also combines HRA, LTA, Conveyance, DA, special allowance, medical allowance, and other incentives.