7th Pay Commission: The possibility of changing the monthly PF and gratuity contribution of central government employees from April 1. Changes in the Provident Fund (PF) after the new pay code comes into force from 1 April may also have an impact on private sector employees. In the new pay code proposed by the central government, a provision has been made to keep 50 per cent of the basic salary of employees in the net monthly CTC. This means that if the new pay code comes into force from April 1, 2021, you will not get more than 50 percent of the monthly salary as an allowance.
What does the government say in this matter?
The Ministry of Labor Secretary Apoorva Chanda said that the Labor Ministry would soon be in a position to implement 4 codes. These will include codes related to salary, related codes related to industrial relations, codes related to employment security and codes related to health, working conditions and social security.
What will be the effect of the wedge on your PF and gratuity?
The implementation of the new wedge code will directly affect your PF and gratuity contribution.
When will the wedge code come into force
The central government has not announced any deadline to implement it yet. However, it is expected that it will come into force from 1 April 2021.
DA edge position
It is expected that the central government may soon announce an increase in DA of central employees. The government will have to wait for the DA announcement between January and June 2021 due to the Corona epidemic.
This decision of the Center will benefit millions of employees
The Finance Ministry has already said that DA can be announced keeping in view the pension and basic salary of central employees. The upcoming expenditure of DA and DR (Dearness Relief) is currently Rs 12510 crore annually. But after the proposed increase it is expected to reach 14995 crores.