India on Friday implemented the four key 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. The move is being hailed as the biggest workforce reform since Independence.
The Government has termed the implementation of the four laws a “historic decision.” It further stated that the new reforms rationalise 29 central labour laws and will help millions of employees by expanding social security coverage and simplifying the pre-Independence regulatory system.
Calling the new labour regime “one of the most comprehensive and progressive labour-oriented reforms since 1947,” Prime Minister Modi said the decision will empower workers and promote ‘ease of doing business.’
The new labour codes offer benefits for all sections of the workforce-from enhanced rights, workplace security, and safety for women to expanded social security for gig and platform workers.
For Gig and Platform Workers
The new codes fully define ‘gig work,’ ‘platform work,’ and ‘aggregators.’ The laws make it mandatory for aggregators to contribute 1–2% of their annual turnover, capped at 5% of the payout to gig and platform workers.
These changes will be complemented by the presence of an Aadhaar-linked Universal Account Number, which will make welfare benefits easy to access, fully portable, and available across states, regardless of migration or where the labour works.
For Contract Workers
Fixed-term employment (FTE) will increase employability and ensure social security and legal protection, offering benefits equal to those of permanent employees. Fixed-term employees will be eligible for gratuity after one year of continuous service.
Under the new codes, the principal employer must provide health benefits and social security benefits for contract workers. Workers will also receive free annual health check-ups.
For Women Workers
Gender discrimination has been legally prohibited, and equal pay for equal work has been ensured. Women workers will now be allowed to work night shifts across all types of work, subject to their consent and mandatory safety measures.
Beyond this, the new laws mandate fixed representation of women in grievance redressal committees. The provision to add parents-in-law to the family definition of female employees expands dependent coverage and strengthens inclusivity.
For Youth Workers
All workers applying for new jobs will receive appointment letters, promoting social security, employment history, and formal employment. The new codes include strict rules to prevent exploitation of workers by employers, and payment of wages during leave has been made mandatory.
Wages will be paid as per the floor wage determined by the Central Government.
For MSME Workers
All MSME workers are covered under the Social Security Code, 2020, with eligibility based on employee count. Minimum wage is guaranteed for all workers, and special provisions have been established for standard working hours, double overtime wages, and paid leave.
