After the implementation of the new wage code, there will be several major changes for the salaried employees, with the biggest impact likely to be on their salary. It is being estimated that after the implementation of the new wage code, the take-home salary of the employees will decrease. However, there is also a discussion that the basic minimum salary of the employees may be increased.
According to the new Wage Code rules, the basic salary of the employees should be 50% of the total salary or the Cost to Company (CTC), and not less than this. At present, most companies keep the basic salary of the employees low and the number of allowances remains high. But as soon as the new wage code is implemented, the existing system will change completely. Companies will have to keep 50 percent or more of the basic salary of the employees’ CTC. In the remaining 50 percent, all the allowances being received by the employees will be counted.
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