📋 Organization & Workforce Profile
👥 Headcount & Salary Structure
What % of CTC is currently classified as wage
% of CTC paid as performance incentive/bonus
📊 Workforce Composition
💼 Financial Context
💰 Code on Wages – 50% Rule Impact
Calculate the cost of restructuring CTC to meet 50% wage requirement and its impact on PF, Gratuity, and Bonus.
Recommended: 50% of CTC
Employer + Employee combined
Average employee tenure for calculation
🛡️ Social Security Code – PF, ESIC, Gratuity & Benefits
Calculate current vs required coverage and liabilities under PF, ESIC, Gratuity, Maternity, and other benefits.
⚖️ Industrial Relations Code – Retrenchment, Closure & Risk
Calculate cost of retrenchment, closure, severance, and IR compliance. Model strike/lockout scenarios.
% of workforce to be retrenched
Typically 45 days per year of service
🔒 OSHWC Code – Safety Infrastructure & Compliance Cost
Estimate capex for safety infrastructure, training, welfare facilities, and medical services.
Ventilation, lighting, sanitation upgrades
Based on industry & history
Compensation, legal, reputational
📈 Complete Labour Codes Impact Summary
Consolidated view: All 4 codes, P&L impact, balance sheet liabilities, headcount sensitivity.
Organization & Financial Profile
| Parameter | Value | Notes |
|---|---|---|
| Organization | - | Industry: - |
| Total Employees | - | Permanent: - | Contract: - | Casual: - |
| Average Monthly CTC | - | Annual wage bill: - |
| Annual Revenue | - | Labour Cost %: - |
| Current EBITDA Margin | - | Post-compliance EBITDA: - |
Code-Wise Annual Cost Impact (P&L)
| Labour Code | Year 1 Cost (₹ Cr) | Year 2-3 Cost (₹ Cr) | Key Impact | Compliance Deadline |
|---|---|---|---|---|
| Code on Wages | - | - | - | June 2025 |
| Social Security Code | - | - | - | Ongoing |
| IR Code | - | - | - | Ongoing |
| OSHWC Code | - | - | - | Ongoing |
| TOTAL COMPLIANCE COST | - | - | % of Revenue | Staggered |
Balance Sheet Liabilities (Provisions)
| Liability | Current Provision (₹ Cr) | Post-Compliance (₹ Cr) | Increase (₹ Cr) | % Impact on Net Worth |
|---|---|---|---|---|
| Gratuity Reserve | - | - | - | - |
| Leave Encashment | - | - | - | - |
| Bonus Accrual | - | - | - | - |
| TOTAL EMPLOYEE LIABILITIES | - | - | - | - |
Risk Scenarios & Sensitivity
| Scenario | Headcount Change | Cost Impact (₹ Cr) | EBITDA Impact | Probability |
|---|---|---|---|---|
| Base Case (Full Compliance) | No change | - | - | 100% |
| Delayed Compliance (Penalties) | -5% to 10% (attrition/retrenchment) | - | - | 30% |
| Strike/Lockout Scenario | No immediate change | - | - | 15% (if union active) |
| Worst Case (Multiple Audits + Litigation) | -10% to 15% (settlements) | - | - | 10% |
Headcount Sensitivity (Annual Cost)
| Headcount | Code on Wages | Social Security | IR Code | OSHWC | TOTAL |
|---|---|---|---|---|---|
| -10% (--) | - | - | - | - | - |
| Current (-) | - | - | - | - | - |
| +10% (+-) | - | - | - | - | - |
| +20% (+-) | - | - | - | - | - |
Action Plan & Recommendations
🎯 Immediate Actions (Next 30 Days)
- ✓ Conduct wage structure audit – classify all components under wage definition
- ✓ Review PF/ESIC registrations and contributions – identify gaps
- ✓ Draft standing orders if >20 workers and not yet done
- ✓ Assess OSHWC compliance – gap analysis on infrastructure & training
- ✓ Constitute cross-functional team (HR, Finance, Compliance, Operations)
📅 Phase 1: Jan-Mar 2025 (Foundational)
- ✓ Finalize CTC restructuring (wage composition) – get employee buy-in
- ✓ Rectify PF/ESIC – retroactive corrections if needed
- ✓ Establish welfare board (if >250 workers)
- ✓ Roll out safety committee, grievance mechanisms
🔧 Phase 2: Apr-Jun 2025 (Implementation)
- ✓ Implement new wage structure (Code on Wages compliance deadline)
- ✓ Upgrade OSHWC infrastructure (training, PPE, medical)
- ✓ Finalize IR procedures (retrenchment, dismissal, closure)
- ✓ Revalue gratuity liability – update balance sheet
📊 Ongoing: Monitor & Report
- ✓ Monthly compliance checklist (wage rules, PF deductions, safety audits)
- ✓ Quarterly financials review (actual vs budgeted compliance cost)
- ✓ Annual external audit – legal compliance certification
- ✓ Board reporting on compliance posture, risks, incidents