Indian Government, in a historic decision, has announced that the four Labour Codes – the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020 are being made effective from 21st November 2025.
Codes Included:
Code on Wages, 2019
- Applies to all employees and establishments, abolishing multiple minimum wage definitions and consolidating them under one law.
- Mandates a national minimum wage and sets criteria for region- and occupation-specific variations.
- Simplifies wage-related definitions, specifying that at least 50% of gross salary must be considered ‘wages’ for all legal calculations.
- Ensures equal pay for equal work and strengthens provisions against gender-based wage discrimination.
Code on Social Security, 2020
- Extends social security coverage comprehensively to unorganised sector workers, gig workers, and platform workers.
- Provides for life insurance, disability insurance, maternity benefits, and old age protection for all categories, including fixed-term employees and inter-state migrants.
- Establishes a National Social Security Board tasked with recommending and monitoring schemes for various worker categories.
- Expands the scope of gratuity eligibility and provides for simplified electronic registration of workers.
Industrial Relations Code, 2020
- Consolidates laws relating to trade unions, labour disputes, and employment conditions.
- Introduces single or negotiating trade union concept for streamlined employer-employee negotiations.
- Revises the definition of “worker” and balances lay-off, retrenchment, and compensation rules; lay-off compensation is 50% of basic wages plus dearness allowance.
- Mandates a grievance redressal committee for establishments with 20+ workers and new procedures for strikes and lockouts.
Occupational Safety, Health and Working Conditions Code, 2020
- Rationalizes safety and health standards across diverse work sectors including factories, mines, and construction sites.
- Sets daily work hour limits (max 8 hours) and rest provisions; mandates workplace welfare amenities like canteens and first-aid.
- Broadened definitions for workers including inter-state migrants, and requirements for regular health checks.
- Provides for gender-sensitive facilities (separate bathrooms/lockers), clear risk management, safety training, and recordkeeping obligations.
Consolidation: These codes replace and rationalize 29 existing labour laws into a simplified framework.
Objectives of the Reform
- Simplification: Streamline compliance for businesses and reduce complexity in labour regulations.
- Worker Empowerment: Ensure social justice, welfare, and protection for all categories of workers, including gig and platform workers.
- Ease of Doing Business: Promote efficiency and reduce bureaucratic hurdles for industries.
- Alignment with Global Standards: Modernize India’s labour ecosystem to match international practices.
Benefits for Workers
- Universal Social Security: Coverage extended to all workers, including informal and gig workers.
- Mandatory Appointment Letters: Employers must provide appointment letters to all employees.
- Timely Minimum Wages: Guarantee of minimum wages paid on time across sectors.
- Improved Safety & Health: Stronger occupational safety and working condition standards.
Benefits for Industry
- Simplified Compliance: One unified framework instead of 29 fragmented laws.
- Flexibility in Hiring & Firing: Easier industrial relations management under the new code.
- Boost to Productivity: Expected to drive efficiency and competitiveness in industries.
- Foundation for Aatmanirbhar Bharat: Supports self-reliant India by creating a future-ready workforce.
Government’s Position
- PM Modi hailed the reform as “one of the most comprehensive and progressive labour-oriented reforms since Independence”.
- The government emphasized that these codes will empower workers, boost job creation, and accelerate India’s journey towards a developed economy (Viksit Bharat).
The four labour codes effective from November 2025 mark a historic shift in India’s labour laws, aiming to balance worker welfare with industrial growth, simplify regulations, and align with global standards.