Hi friends,
I am seeing lot of articles these days saying employees take-home salary will be reduced once the new Wage code is implemented, because the PF contributions will increase - considering Basic will be capped at 50% of the Gross. so on & so forth.
I am not able to understand this logic, because there is a ceiling of Rs. 15000 for PF calculation and even if the Basic increases due to new wage code - PF contribution may be capped at the ceiling limit f Rs. 15000 only.
Then how will the PF contribution increase. Can you throw some light on this.
Best Regards
Kartik
From India, Belgaum
I am seeing lot of articles these days saying employees take-home salary will be reduced once the new Wage code is implemented, because the PF contributions will increase - considering Basic will be capped at 50% of the Gross. so on & so forth.
I am not able to understand this logic, because there is a ceiling of Rs. 15000 for PF calculation and even if the Basic increases due to new wage code - PF contribution may be capped at the ceiling limit f Rs. 15000 only.
Then how will the PF contribution increase. Can you throw some light on this.
Best Regards
Kartik
From India, Belgaum
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Dear Kartik,
Where the organizations are restricting themselves PF contribution up to 15,000/- , there is no problem. But there are organizations who are paying on actual Basic & DA which is more than 15,000/- statutory limit, for those organizations it will be extra cost due to increase of Basic and DA (50% of total wages after implementation of labor codes ).
Thanks & regards,
S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531
USD HR Solutions – To Strive towards excellence with effort and integrity
From India, New Delhi
257Where the organizations are restricting themselves PF contribution up to 15,000/- , there is no problem. But there are organizations who are paying on actual Basic & DA which is more than 15,000/- statutory limit, for those organizations it will be extra cost due to increase of Basic and DA (50% of total wages after implementation of labor codes ).
Thanks & regards,
S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531
USD HR Solutions – To Strive towards excellence with effort and integrity
From India, New Delhi
PF Contribution on not less than Minimum Wage.pdf