Business desk : November 2025:
Sandeep Dhand Journalist
Tv10 Punjab
India has taken a major step in labour reform by implementing four new Labour Codes from 21 November 2025. These codes bring together 29 old labour laws into a simpler and modern structure. The aim is to make the rules for wages, safety, social security and industrial relations easier to understand and more worker-friendly.
The government says that these reforms will provide stronger protection to workers, especially those in unorganised sectors. Experts believe that these changes will affect over 40 crore workers across the country.
Why New Labour Codes Were Needed
For many years, India’s labour laws were considered complicated and outdated. There were multiple rules, different laws for different industries and many processes that caused confusion for employees as well as employers. Companies had to follow many separate registrations, inspections and compliance formats.
Workers, especially those working on contract or in the unorganised sector, faced problems like:
Irregular wages
No appointment letter
No social security
Lack of safety at workplaces
Delayed payments
To solve these long-standing issues, the government created four Labour Codes that combine all major labour laws into four easy categories.
Overview of the Four New Labour Codes
- The Wage Code (2019)
The Wage Code brings together laws related to wages and payment. Under this code:
Minimum wages will be fixed more clearly.
All workers must receive wages on time.
Wage rules will be the same for all industries, helping avoid confusion.
This code ensures that every employee, whether in organised or unorganised sectors, gets fair and timely payment.
- The Industrial Relations Code (2020)
This code focuses on relations between employers and employees. It covers:
Rules for forming trade unions
Procedures for disputes
Conditions for hiring and retrenchment
One important change is that workers must give prior notice before going on a strike. Also, if a large number of employees take leave together, it may be treated as a strike. Some worker groups feel this rule may make strikes more difficult.
- The Social Security Code (2020)
This is one of the most important codes because it covers:
Provident Fund (PF)
Employee State Insurance (ESI)
Gratuity
Maternity benefits
Social benefits for gig and platform workers
Almost 40 crore workers are expected to receive some benefit under this code. Workers above 40 years will get free annual health check-ups. Fixed-term employees working for one year will become eligible for gratuity, which earlier required five years.
Gig workers like delivery agents, cab drivers and online freelancers are also included for the first time in India’s labour law framework.
- The Occupational Safety, Health and Working Conditions Code (2020)
This code focuses on safer and healthier work environments. It applies to factories, mines, construction sites, shops and establishments.
Key features include:
Better safety standards for workers
Health and facility requirements
Regular inspections to ensure compliance
100% health security in high-risk jobs
The idea is to improve working conditions and reduce accidents and health risks.
Major Benefits for Workers
The government claims that the new Labour Codes will make working conditions in India more secure and transparent. Major benefits include:
- Timely and Guaranteed Minimum Wage
Every worker will receive wages on time, and minimum wage rules will be followed strictly.
- Appointment Letter for Every Employee
This is especially helpful for young workers. Companies must issue appointment letters, ensuring job clarity.
- Equal Pay for Women
Women employees must receive equal pay for equal work, creating a more fair workplace.
- Social Security for Millions of Workers
More than 40 crore workers will fall under some form of social security, including gig workers.
- Gratuity for Fixed-Term Employees
Workers on a fixed-term contract will get gratuity after completing one year.
- Free Health Check-up for Workers Above 40
This will help detect health problems early and protect long-term health.
- Double Overtime Payment
Workers doing overtime must be paid twice the normal wage rate.
- Safer Workplaces
Health and safety standards will be strictly monitored.
These benefits are expected to bring long-term financial stability and security to workers.
Prime Minister Modi’s Response
Prime Minister Narendra Modi welcomed the implementation of the Labour Codes. He said it is the biggest labour reform since Independence, aimed at making workers empowered, secure and protected. He added that these changes will improve the quality of life for workers and create a fair and modern labour system in India.
Criticism and Challenges
While the Labour Codes have many strong points, several labour groups and experts have pointed out concerns and challenges.
- Strikes May Become Harder
Workers now need to give advance notice before going on strike. In some cases, even mass leave can be considered as a strike. This may limit workers’ right to protest.
- Less Protection in Smaller Companies
Companies with up to 300 workers do not have to follow strict Standing Orders. This may reduce job security for employees in small and medium firms.
- Easier Lay-offs
Companies with fewer than 300 employees can retrench workers or close units with less approval. Critics say this may reduce job protection.
- Confusion About Definition of Wages
Many employers are unsure which allowances are included in “wages” and which are excluded. This may lead to compliance problems.
- Many Rules Still Need Clarification
Some parts of the codes will work fully only after the government issues detailed rules and schemes. Until then, workers may not see the actual benefits on the ground.
Impact on Industry
The new Labour Codes bring several reliefs for industries:
Simplified compliance
Single registration for multiple rules
Faster dispute resolution
Flexibility in hiring and retrenchment
Many industries believe this will help create more employment and increase investment in India. However, they must also upgrade safety systems and ensure proper working conditions, as required under the new safety code.
Impact on Contract Workers and Gig Workers
A major change is the inclusion of gig and platform workers. This is important because India has a rapidly growing gig economy. Under the new codes:
Gig workers will receive social security
PF-like schemes may be introduced
A welfare fund may be created for their benefit
Contract workers will also see improvements in working conditions and safety measures.
How Workers Should Prepare
Workers need to be aware of their new rights so they can take full advantage of the Labour Codes. They should:
Understand their wage structure
Check if they receive an appointment letter
Know about PF, ESI and gratuity benefits
Stay informed about safety rules
Seek help if rules are not followed
Awareness is key to ensuring that workers receive the full benefits promised by the reforms.
Conclusion
The implementation of the four Labour Codes marks a major change in India’s labour system. The reforms aim to create a balance between worker protection and industry-friendly rules.
While the new codes offer many benefits such as better wages, job clarity, social security and safer workplaces, there are also challenges that need attention. Workers, companies and the government will all play a crucial role in making the new system effective.
Experts say that if implemented properly, these reforms can help improve India’s employment system and strengthen the country’s workforce for the future.