India’s Four Labour Codes: A Detailed and Comprehensive Analysis

The Government of India has ushered in a historic transformation in labour governance by formally implementing the four consolidated Labour Codes—the Code on Wages, 2019; Industrial Relations Code, 2020; Code on Social Security, 2020; and Occupational Safety, Health and Working Conditions (OSH) Code, 2020. These codes unify India’s labour law framework, replacing twenty-nine scattered legislations that had evolved over decades in response to the realities of the 1930s and 1950s. Those legacy laws were drafted at a time when workplaces were limited largely to factory floors, when the gig economy was unimaginable, when MSMEs did not dominate the industrial landscape, and when worker mobility, safety, and social security had a very restricted meaning.

In contrast, India today is a fast-changing, technology-driven, globally integrated economy. Employment takes multiple new forms such as platform work, fixed-term employment, hybrid engagement, and specialised contract services. The shift from a manufacturing ecosystem to a multi-sectoral economy created complexities and inconsistencies in labour regulation. As a result, employers faced administrative hurdles, and workers—especially those in the informal sector—received inadequate protection. It is against this backdrop that the new Labour Codes were introduced to establish a unified, simplified, and globally aligned labour framework.

At the heart of these reforms is the objective of unifying India’s labour laws into clear, easy-to-understand codes that protect workers while enabling industry growth. The table below captures the essence of the transition from the old regime to the new, simplified one:

Table 1: From Fragmented Labour Laws to Unified Codes

One of the most significant shifts brought by the Labour Codes is the strengthening of formal employment practices. Previously, the issuance of appointment letters was not mandatory in many sectors, which often led to disputes about wage entitlements, termination, and service conditions. Under the new regime, every employee must receive a formal appointment letter. This brings transparency, improves job security, and ensures workers understand their rights and obligations.

Social security has been another area of major enhancement. Earlier, access to PF, ESI, and insurance was limited largely to organised sector employees. Gig workers—who power the modern digital economy—were almost invisible under earlier labour laws. Today, gig and platform workers are legally recognised for the first time in India. The Social Security Code mandates aggregators to contribute a percentage of their turnover towards a Social Security Fund dedicated to worker welfare. An Aadhaar-linked universal account number allows portability of benefits across states and employers, ensuring lifelong access to benefits such as insurance, pension, and health schemes.

The Codes also introduce a landmark reform in the form of a Universal Minimum Wage, ensuring that every worker in India—not only those employed in scheduled sectors—receives a legally guaranteed floor wage. This national floor wage will be periodically revised based on cost-of-living indices, helping bring uniformity across states while preventing exploitation in low-wage sectors. Complementing this, the timely payment of wages is now mandatory, bringing clarity to wage cycles and protecting vulnerable workers from delayed payments.

Another progressive feature of the Labour Codes is their strong focus on preventive healthcare and occupational safety. Workers aged 40 years and above are now entitled to a free annual health check-up. In addition, the OSH Code mandates stricter safety standards, including hazard management protocols, periodic medical examinations, and compulsory safety committees in factories, mines, and hazardous industries. ESIC coverage has been expanded nationwide—even to establishments employing a single worker engaged in hazardous processes—ensuring comprehensive medical and social protection.

Women workers stand to gain considerably under the new Labour Codes. While earlier laws imposed restrictions on working hours and prohibited women from working at night in certain industries, the new Codes allow women to work in all sectors, including hazardous industries and night shifts, subject to their consent and adequate safety measures. Gender neutrality is emphasised throughout the Codes, with equal wages for equal work, anti-discrimination protections, and mandatory inclusion of women representatives in grievance redressal committees. The definition of “family” has also been expanded to include parents-in-law, further strengthening women's social security rights.

Fixed-term employment (FTE)—a modern, flexible mode of engagement—has been made more worker-friendly. FTEs are now entitled to the same wages, social security benefits, and working conditions as permanent employees. Additionally, they become eligible for gratuity after a single year of service, unlike the earlier regime where five years of continuous service were necessary. This balanced approach supports industries that face seasonal demand while protecting workers from exploitation.

The benefits extend equally to contract workers, who are now assured social security coverage, annual health check-ups, and gratuity. The Codes promote a more equitable relationship between principal employers and contractors by bringing transparency to wage payments, working conditions, and welfare facilities.

To facilitate easier understanding, the following table summarises how major worker groups benefit under the new Labour Codes:

Table 2: Worker Categories and Key Benefits

Sector-specific provisions further strengthen worker protection in industries that traditionally faced high risk or irregularities. Beedi and cigar workers will benefit from regulated working hours and mandatory overtime pay. Plantation workers receive enhanced chemical safety training, medical benefits, and family coverage under ESIC. Journalists and audio-visual workers gain transparent wage structures and mandatory appointment letters. Mines and hazardous industries must now comply with stringent safety standards and regular health assessments. The IT and ITES sector, which often faced ambiguity in labour compliance, now enjoys clarity: salaries must be released by the 7th of every month, and women workers may participate in night shifts with safeguards. Export, textile, and dock workers receive improved social security, wage protection, and occupational safety, boosting both worker welfare and industry competitiveness.

An equally transformative aspect of the Labour Codes is the shift to a guidance-oriented inspections system. Inspectors will act as facilitators helping establishments comply rather than acting solely as enforcement authorities. The introduction of digital inspection schemes, web-based compliance, and single electronic filings reduces human intervention, curbs corruption, and improves transparency. Industrial dispute resolution is expected to become faster with the creation of two-member Industrial Tribunals, ensuring predictable outcomes and reducing pendency.

The social security net in India has expanded significantly over the last decade—from covering only about 19% of the workforce in 2015 to more than 64% in 2025. With the Labour Codes, this coverage is expected to reach unprecedented levels as even unorganised and gig-sector workers receive mandatory social protection. A National Occupational Safety and Health Board will soon standardise safety protocols across industries, ensuring uniformity and compliance nationwide.

India is now laying the foundation for a labour system that promotes productivity while protecting worker dignity. These reforms recognise the realities of a modern economy and prepare the workforce for future challenges. As India positions itself to become a global economic leader, the new Labour Codes represent a bold step toward building a labour ecosystem that is fair, efficient, inclusive, and internationally aligned.

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