Lets discuss on Major Impacts of Code on Wages Act’2019 instead of Earlier laws of Wages.
From India, Kolkata
Definition of wages under the Code:
As per the Code – (i) basic pay, (ii) dearness allowance and (iii) retaining allowance have been included as components of 'wages'.
Further, the Code excludes the following components from the definition of wages: (a) bonus payments;
(b) value of the house-accommodation, supply of light, water, medical attendance or other amenity or of any service excluded from the computation of wages by an order of the appropriate Government;
(c) employer contributions to any pension or provident fund;
(d) conveyance allowances;
(e) sums paid to the employee to defray special expenses on him by the nature of his employment;
(f) house rent allowance;
(g) remuneration payable under award or settlement between the parties or order of court or tribunal;
(h) overtime allowance;
(i) commission payable to employee;
(j) gratuity payments; and,
(k) retrenchment compensation or other retirement benefit payable to the employee or any ex-gratia payment made to the employee on the termination of his employment.
It is to be noted that for the purpose of equal wages to all genders and for the purpose of payment of wages, the emoluments specified in clauses (d), (f), (g) and (h) (specified above), should also be considered for computation of wages.
The Code prescribes that if the sum-total of the excluded components (apart from gratuity and retrenchment compensation) exceeds 50% (Fifty Percentage) (or such other percentage notified by the Central Government) of the total remuneration, then that portion of the amount exceeding 50% (Fifty percentage) (or such other percentage notified by the Central Government) is also to be calculated as 'wages' under the Code. Employers should be particularly wary of such a stipulation in devising salary structures for their employees.

From India, New Delhi
Dear Ranjeet,

As the Code on Wages,2019 subsumes the existing Payment of Wages Act,1936, the Minimum Wages Act,1948, the Payment of Bonus Act,1965 and the Equal Remuneration Act,1976, it acts as a single monetary legislation relating to employment. Broadly speaking, it has got the following merits in nutshell over the existing laws which stand subsumed:

1) Removal of multiplicity of definitions promoting ease of understanding and interpretative convenience.

2) Removal of multiplicity of authorities.

3) Ensuring timely payment of wages to all employees.

4) Ease of compliance and

5) Modification of the role of inspector to that of facilitator.

To be specific the following provisions of the COW,2019 can be described as improvement over the subsumed four laws:

1) The definition of the term wages u/s 2(y) of the Code removes the confusion over the components of the wage structure thereby eliminating disproportionate apportionment of components so as to reduce the fringe benefits of employment like statutory bonus, gratuity, retrenchment compensation.

2) The Code empowers the Central Government to fix National Floor Wages universally or region wise and imposes the restriction on the fixation of minimum wages by the appropriate Governments not less than the NFW.

3) Conviction for sexual harassment has been included as a disqualification for eligibility to statutory bonus.

4) Resignation also included in the final payment time limit for settlement of dues.

5) The time limit for filing all claims under the Code has been extended to three years.

6) Inspectors are redesignated as facilitators with expanded jurisdiction. Web based electronic inspections have been introduced to help employers with better compliance.

7) Penal provisions have been modified by providing for compounding of certain offences and by enhanced penalty up to one lakh Rupees with imprisonment up to 3 months in case of repeated offences.

From India, Salem
Thanks to HR-Revolution & Mr. Umakanthan. M for your brief notes. However if any .pdf or .ppt file available kindly upload the same for details understanding.
From India, Kolkata
rkn61
462

@Ranjeetjha,
By reducing the number of prevailing Labour Laws and also by aiming labour reforms & far reaching changes in the field of Labour, out of the four Codes of Labour implemented by Government of India, 3 Codes are passed in Parliament. Occupational Safety, Health and Working Conditions Code,2020, the Industrial Relations Code 2020 and the Code on Social Security, 2020 are the three bills which are approved in both Houses of Parliament. Code of Wages, fourth Code, was already passed in Parliament in the year 2019 and assent from President was also received.
Definition of words, such as, Employer, Employee, Establishment, Wages are given equal definition in all the four Codes. Therefore, confusion and arguments, arising out of these words, shall come to an end. Process of registration is also simplified. An Establishment which is registered under one Law, need not apply for registration under the remaining other Laws.

From India, Aizawl
Please find the attached interpretation
From India, Pune

Attached Files
File Type: pdf Interpretation.pdf (364.9 KB, 286 views)

Hi Everyone
Related to the topic of discussion.....Impact of COW 2020.... while viewing a webinar on youtube, came to know from one of the speaker that since Occupier and Manager has been clearly defined as Employer in case of factory, the owners of the factory who gives the factory on lease are now saved from several vicarious liabilities, which was not the case earlier.
However, upon reading its found that the same definition is also there in repealed act POW1936.
Request if experts can throw some light on this please.
Thanks and regards

From India, Calcutta
Under Code on Wages, Scheduled Employments have been abolished and therefore all works are covered under Minimum Wages Act. The wage limit under Payment of Wages Act is also removed to protect wages of all 'employees'
From India, Pune
There is one point that I feel requires review. Settlement for exiting employees withing 2 days from last working day. I assume this is framed keeping in mind the Government sector. In IT sector, there would be a number of assets and clearances that need to be done on the last working day and terminating the employee in the system . Given that the payroll have a defined pay cycle, this would lead to a daily process of settlements and can have impact on the final pay as taxes would have to be recovered ,if the employee has not made his investments for the year at the time of exit.
From India, Bangalore
Dear all, hoping to get some advice from experts as I am bit confused. We have an employee whom we will be paying as below for 2020-21 :
Monthly Basic : 14,450
Monthly HRA : 7,225
Monthly Conveyance : 1600
Monthly special allowance : 14,150
TOTAL MONTHLY : 37,425
Yearly LTA+Medical (Fixed) : 20,000
Yearly Bonus + Performance payment : 43,350 (ALMOST SIMILAR EVERY YEAR)
TOTAL ANNUAL : 512,450
Apart from this we also pay gratuity in group gratuity fund and employer PF.
What changes would we need to make to fit the new CODE OF WAGES?

From India, Aurangabad

If you are knowledgeable about any fact, resource or experience related to this topic - please add your views using the reply box below. For articles and copyrighted material please only cite the original source link. Each contribution will make this page a resource useful for everyone.


Please Login To Add Reply






About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2021 CiteHR.Com™

All Material Copyright And Trademarks Posted Held By Respective Owners.
Panel Selection For Threads Are Automated - Members Notified Via CiteMailer Server