STATUTORY COMPLIANCE
Statutory Compliance & Wage Structure Alignment - For a Leading Automation Engineering Company
EXECUTIVE SUMMARY
A rapidly growing Automation Engineering Company was struggling with statutory compliance due to unstructured salary components, inconsistent wage definitions, and lack of documented processes. With the new Wage Code coming into effect, their existing payroll framework exposed them to significant compliance risks in PF, ESI, Bonus, Gratuity and wage calculations.
Paresha HR Services conducted an in-depth statutory compliance review, redesigned salary structures and established a unified compliance framework that strengthened governance, accuracy and audit readiness.
Key Challenges
01
Misaligned salary components not compliant with the Wage Code
02
Inconsistent definition of wages across employee categories
03
Exposure to financial risk in PF, ESI, gratuity & bonus calculations
04
No standard operating procedures or compliance documentation
05
Limited internal awareness of Wage Code implications and statutory requirements
Paresha HR’s Intervention
01
Compliance Audit & Gap Assessment
- Conducted a detailed audit of existing wage structures & statutory parameters
- Identified mismatches with Wage Code definitions of “wages”
- Assessed financial and legal impact on PF, ESI, gratuity & bonus computations
02
Wage Structure Realignment
- Redesigned salary structures fully aligned to Wage Code norms
- Standardised classification of basic wages, allowances and exclusions
- Reduced compliance risk without affecting employee take-home salary
- Ensured a legally robust and future-ready wage framework
03
Statutory Alignment Across All Components
- Updated PF, ESI, gratuity & bonus calculations with the newly aligned wage structure
- Ensured consistent statutory treatment for all employee levels
- Eliminated discrepancies in statutory deductions and employer contributions
04
Process Documentation & Internal Controls
- Created comprehensive statutory compliance SOPs
- Established checkpoints for payroll verification and compliance validation
- Set up periodic review cycles for continuous compliance monitoring
05
Knowledge Transfer & Stabilisation
- Conducted training sessions for management & HR teams on Wage Code impact
- Enabled the internal HR team to independently manage ongoing compliance
- Ensured audit readiness and preparedness for future legislative changes
Results & Business Impact
✔ Full alignment with Wage Code requirements
✔ Reduced statutory compliance risks and audit exposure
✔ Accurate PF, ESI, gratuity and bonus calculations
✔ Standardised wage structure & compliance processes across the organisation
✔ Improved management confidence and operational transparency
“The clarity and structure Paresha HR brought into our statutory compliance process exceeded our expectations.
The team helped us understand the real impact of the Wage Code and guided us through every step of restructuring our salary components.
The transition was smooth, well-documented, and completed far quicker than we anticipated.
Today, our payroll and compliance processes are consistent, transparent, and audit-ready. Something we struggled with for years.”
— HR & Compliance Lead, Automation Engineering Company
Value Delivered
Paresha HR transformed the company’s compliance ecosystem from fragmented and non-aligned wage structures to a legally compliant, standardised and transparent statutory framework.
Our intervention ensured accuracy, sustainability and readiness for future labour law transitions. Strengthening both compliance governance and organisational trust.
