India's new labour codes could impact your salary starting next year. The key change? Your basic salary must be at least 50% of your total pay. This could increase deductions like Provident Fund (PF), potentially reducing your take-home income. However, the Labour Ministry there will be no drastic change for the employees.
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New Labour Code 2025: Will Your Take-Home Salary Shrink? | Vantage with Palki Sharma
India is set to introduce new labor laws that will consolidate 29 existing rules into 4 simplified labor codes. This change could affect how salaries are structured, potentially altering the take-home pay of employees. The new rules mandate that the basic salary must be at least 50% of the total compensation package, which could increase deductions towards retirement savings like the Provident Fund (PF) and reduce the in-hand salary. However, the Indian government has clarified that for most employees, especially those with PF contributions already capped at ₹15,000, there won't be significant changes. The impact on take-home pay will largely depend on how individual companies adjust their salary structures to comply with the new codes. Employees are advised to review their salary slips carefully as these changes take effect.
This summary is AI Generated & Firstpost is not responsible for the facts represented in it.