New Wage Code Explained: Employee Working Hours, Salary Structure Likely To Change By April 1

With the new financial year starting from April 1, several changes in the corporate sector are likely to take place. 

One of these is the expected change in the working hours and salary structure of employees. The central government plans to roll out a scheme that  allows institutions to have four working days a week by increasing the daily working hours to 12 hours in place of the current 9 hours. 

In another change likely to place, the government is expected to reduce the take-home salary of an employee by increasing the gratuity and provident fund. 

The government passed Wages Code Bill in the parliament last year. Likely to come into effect by April 1, these are the changes the law will bring into the lives of corporate employees as well as the employer:

1. A break of 30 minutes would be mandatory after every five hours of work.

2. Over five hours of continuous work is prohibited.

3. Over 15 minutes of work would qualify as overtime. Currently, less than 30 minutes of work after the working hours is not considered overtime.

4. Basic salary would be 50 per cent or more of the total salary, thus compulsorily changing the salary structure of an employee. 

5. A rise in gratuity and the provident fund would increase the amount of money received after one's retirement.

The central government claims that the new laws will benefit both the employees as well as the employer at any working institution.