New Delhi: In a historic decision, the government announced on Friday the implementation of the four Labour Codes, which rationalised 29 existing labour laws, with immediate effect.
Table of contents
The four labour codes are: 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, which are effective Friday, replacing 29 fragmented laws with a unified, modern framework.
“The four labour codes have been notified and now they are the law of the land,” said labour minister Mansukh Mandaviya at a press conference here.
According to the Minister, the Codes will formalise employment, strengthen worker protections, and make the labour ecosystem simpler, safer and globally aligned.
The government will now initiate consultations to frame detailed rules and schemes.
During the transition, provisions of existing labour laws will remain applicable wherever required.
Key changes under the labour codes
The Labour Codes introduce a series of transformative reforms that benefit workers across all sectors:
1. Formalisation of Employment
Mandatory appointment letters ensure transparency, proof of employment, and stronger job security.
2. Universal Social Security Coverage
All workers, including gig and platform workers, are now covered under the Social Security Code and eligible for PF, insurance, and other welfare benefits.
3. Minimum & Timely Wage Protection
A statutory minimum wage and timely payment requirements safeguard income stability for every worker.
4. Preventive Healthcare for Workers
Annual free health check-ups for employees aged above 40 to promote early detection and a national culture of preventive care.
5. Enhanced Women’s Workforce Participation
Women can now legally work night shifts across all establishments with their consent, provided they comply with mandatory safety measures, removing previous restrictions.
6. Nationwide ESIC Coverage
Employee State Insurance (ESI) benefits are now available pan-India, overcoming earlier limits based on notified areas and specific industries.
7. Reduced Compliance Burden
Single registration, single licence, and single return simplify procedures for employers without compromising worker protection.
Gig and platform workers identified for the first time
The Codes have defined ‘Gig work’, ‘Platform work’, and ‘Aggregators’ for the first time. Now aggregators must contribute 1 to 2% of the annual turnover. It is capped at 5% of the amount paid to gig or platform workers.
Under the Code on Social Security, 2020, all workers, including gig & platform workers, will be covered by social security. All workers will get Provident Fund (PF), Employee State Insurance Scheme (ESIC), insurance, and other social security benefits.
Under the Code on Wages, 2019, all workers are entitled to receive a statutory minimum wage payment. Minimum wages and timely payment will ensure financial security.
The social-security coverage expanded from 19 per cent in 2015 to over 64 per cent in 2025.
Other major benefits
The codes will guarantee minimum wages for all workers, appointment letters for the youth, equal pay and respect for women, social security for 40 crore workers, gratuity for fixed-term employees after one year of employment, free annual health check-ups for workers above 40 years of age, double wages for overtime, 100 per cent health security for workers in hazardous sectors and social justice for workers as per international standards.
“These reforms are not just ordinary changes, but a major step taken by Prime Minister Shri Narendra Modi for the welfare of the workforce. These new labour reforms are an important step towards a self-reliant India and will give new momentum to the goal of a developed India by 2047,” the Labour Minister said on X.
According to a ministry statement, the Codes lay the foundation for Aatmanirbhar Bharat.
Insurance coverage
The ESIC coverage and benefits are extended pan-India, are voluntary for establishments with fewer than 10 employees, and mandatory for establishments with even one employee engaged in hazardous processes.
Now, Fixed-Term Employees (FTE) will receive all benefits equal to those of permanent workers, including leave, medical, and social security.
Aadhaar-linked Universal Account Number will make welfare benefits easy to access, fully portable, and available across states, regardless of migration.
Moreover, Plantation workers will be brought under the Occupational Safety and Health Work Code (OSHWC) and the Social Security Code.
Digital and audiovisual workers, including journalists in electronic media, dubbing artists, and stunt performers, will now be entitled to full benefits.
Initially, India’s labour laws were framed in the pre-Independence and early post-Independence era (1930s–1950s), at a time when the economy and world of work were fundamentally different.
While most major economies have updated and consolidated their labour regulations in recent decades, India has continued to operate under fragmented, complex and in several parts outdated provisions spread across 29 central labour laws, it said.
(With inputs from PTI)
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