India's New Labour Codes Draft Rules Redefine Wage and Gratuity Calculations
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India's New Labour Codes Draft Rules Redefine Wage and Gratuity Calculations

New draft rules for India's labour codes aim to standardize wage and gratuity calculations. Previously, employers often minimized statutory contributions by allocating a small portion of compensation to basic pay and dearness allowance. The new rules mandate that most components of cost-to-company (CTC) will count towards remuneration, with a maximum 50% exemption for allowances. This is expected to increase employer contributions to provident fund and gratuity.

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