In the Halachot of the Jewish wedding, there is discussion regarding the role of the "Heder Yihud"-the room od seclusion, in which the Hatan and Kallah are secluded behind closed doors, with witnesses, as part of the wedding process. The Rambam and Maran (E.H. 55) both rule that the wedding is not consummated until there is Yihud. Accordingly, it would follow that the logical time to do Yihud is right after the Hupa and the Berachot of the Nissuin.
Yet, it seems that many of the Aharonim were not concerned about doing the Heder Yihud. The Ben Ish Hai (Rav Yosef Haim of Baghdad, 1833-1909) in Parashat Shoftim writes that the custom in Baghdad was to perform the wedding under a Hupa and/or a Tallit, and after the wedding, the couple would go to their new home, not mentioning a Heder Yihud. Rav Haim Palachi (Turkey, 1788-1869) brings the same tradition, as does Rabbi Aharon Ben Shimon. Thus, it seems that he tradition throughout the ages was to rely on the Poskim who hold that a Hupa or Tallit is sufficient, and there is no need for a Yihud room. The requirement of seclusion is fulfilled after the wedding when the couple goes to the place they will spend the night. Alternatively, the Aruch HaShulhan (Rav Yechiel Michel Epstein of Nevarduk, 1829-1908), in Siman 55:15, writes that even the Rambam did not require seclusion in a room. He just meant that the Hatan has to stand next to his bride. However, there is a discussion as to how to understand this Aruch HaShulhan.
The argument to do a Yihud room is actually a concern raised by the Bet Shmuel in Hilchot Berachot. He argues that waiting to do the Yihud until the wedding party is over constitutes a Hefsek-interruption between the Sheva Berachot and the actual execution of the Misva. Hacham Ovadia in Yabia Omer disagrees and explains why there is no concern.
First, it is not so clear the Sheva Berachot are regular Berachot on a Misva which need to be performed immediately before the Misva. The Bet Yosef writes explicitly in the name of the Ran that these Berachot are actually Birkot HaShevach-Berachot of praise, which do not have to be attached to the act. For example, the Birkot HaShahar are recited each morning as praise for our bodily functions after we have already done the act.
Secondly, even if they are Birkot HaMisva, perhaps doing Yihud several hours later is also considered "Over La’Asiyatan"-prior to execution-and there is no problem. He asks, would anyone say that it’s a problem for the Hatan and Kala to talk while exiting the Hupa? Would that be considered a Hefsek-interruption? Rather, the wedding canopy or Tallit can be relied upon to be the main form of Hupa, which is immediately upon recitation of the Berachot. The Yihud is an extra element.
Third, he argues that it is somewhat distasteful to do the Yihud during the wedding, as everyone knows the purpose of the seclusion.
Finally, the fact is that the custom of the Sephardim has always been not to do the Heder Yihud. If someone would now go out of his way to start doing a Heder Yihud, it is disrespectful to his parents and past generations, as if to say that he is smarter and better than them. Moreover, if someone would do this Yihud, it would consummate the marriage in such a way that the Kallah would then have to cover her hair, which is not the common practice at weddings.
This is the opinion of Hacham Ovadia. There is a disagreement what Hacham Bension did. Hacham Natan Ben Senyar writes that he did, in fact, insist on a Heder Yihud. On the other hand, Hacham Ovadia writes that the rabbis of Porat Yosef did not do Heder Yihud.
SUMMARY
It is not the Sephardic practice to do a Heder Yihud at the wedding.
