Labour Codes: Capping of allowances at 50%

According to the new wage code, basic pay should account for 50 per cent of employees’ cost-to-company or CTC. The allowances given to employees, such as house rent allowance (HRA), leave travel, conveyance/transportation and overtime, will account for the remaining 50 per cent of the CTC. If any of these go beyond 50 per cent of the CTC, the excess will be considered as remuneration and get added to the salary.
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