India's new salary rules are not coming into effect tomorrow, as was being expected. The new wage code that is likely to change the existing salary structures for most employees has been deferred, reports The Economic Times, citing a senior labour ministry official. This code and the other three codes, including the social security code, the code on industrial relations and the code on occupational safety, health and working conditions, are not going to be implemented starting April 1 as was the earlier deadline. Industry experts on compensation, law and recruitment see this as a breather for now. The delay will provide more time for companies to rework the employee compensation structures. After the government notifies it, the new wage regime will usher in changes to salary structures of most of India’s formal sector. The Wage Code deals with both government jobs as well as private sector jobs.

Staffing firms and HR professionals say that the new salary regime will cause changes to most pay structures in the country. Currently, for an overwhelming number of employees, the basic pay component is significantly lower than 50%. Data from staffing firms shows allowances sometimes make up as much as 80% of compensation for high-earning employees. Such employees are set to take the most noticeable hit on take-home pay.