LatestCorporate Compliance 11 September 2026
India's New Labour Codes Slash Take‑Home Pay, Boost PF
India's four labour codes came into force on 21 Nov 2025, introducing a 50 % wage rule that trims employees' take‑home pay while mandating higher employer contributions to the provident fund and gratuity. A worked example shows net salary falling sharply, but PF and gratuity balances rising, reshaping payroll calculations nationwide.
Key changes:
- 50% wage rule limits take‑home pay, cutting net salary for many employees.
- Employer PF contribution rises to 12% of basic, and gratuity calculations increase.
- Example: a ₹50,000 salary now sees take‑home drop to ~₹40,000, while PF grows from ₹3,000 to ₹6,000.
For full details, see the original article.
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