India’s labour laws have been recently consolidated into four comprehensive Labour Codes which became effective on November 21, 2025. These new codes aim to simplify the regulatory framework, expand social security, and balance employer flexibility with worker protection.
The Four Labour Codes
The new framework replaces 29 existing laws and applies to various sectors including organized, unorganized, gig, and platform workers.
- The Code on Wages, 2019: Consolidates laws related to timely payment and minimum wages, bonus, and equal remuneration. Key highlights include a universal statutory right to minimum wages for all workers and a national “floor wage” that no state can undercut. Overtime pay must be at least twice the normal wage rate.
- The Industrial Relations Code, 2020: Amalgamates laws concerning trade unions, conditions of employment, and industrial disputes. It introduces provisions for fixed-term employment, a re-skilling fund for retrenched workers, and raises the threshold for requiring government approval for lay-offs and retrenchments from 100 to 300 workers.
- The Code on Social Security, 2020: Expands social security benefits like provident fund (PF), employee state insurance (ESI), and maternity benefits to a wider range of workers, including gig and platform workers. It simplifies registration processes and ensures portability of benefits across states.
- The Occupational Safety, Health and Working Conditions (OSHWC) Code, 2020: Consolidates laws related to workplace safety, health, and working conditions. It mandates an 8-hour workday/48-hour work week, free annual health check-ups for workers over 40 in specific establishments, and allows women to work night shifts with proper safety measures.
Key Provisions and Impacts
- Mandatory Appointment Letters: All workers must now receive an appointment letter specifying job details, wages, and social security entitlements, promoting formalization of employment.
- Wage Definition Change: The codes introduce a uniform definition of “wages,” stipulating that basic pay must constitute at least 50% of the total remuneration. This increases the base for PF and gratuity contributions, which may reduce an employee’s monthly take-home salary but increases their long-term savings.
- Simplified Compliance: The previous system of multiple registrations, licenses, and returns has been replaced with a single electronic registration, single license, and single annual return for employers.
- Penalties for Non-Compliance: Violations of labour laws can result in significant fines, legal action, and even imprisonment for severe offences, with provisions for compounding minor offences with monetary penalties.
For detailed information on the acts and rules, employers and employees can use the official Shram Suvidha Portal of the Ministry of Labour & Employment.
