Early gratuity, WFH provision, gender-neutral wages: Centre enacts new labour codes

NEW DELHI: The Government of India brought all four Labour Codes into effect from 21 November 2025, triggering the most comprehensive reform of the country’s labour legislation in decades.The Ministry of Labour and Employment issued official notifications confirming the enforcement of the Code on Wages, Industrial Relations Code, Social Security Code, and the Occupational Safety, Health and Working Conditions Code.

The new regime consolidates 29 Central labour laws into four streamlined Codes, which the Centre described as a “historic modernisation” intended to simplify compliance, reduce fragmentation, and extend social protection to a wider workforce.

According to the Government, many of India’s earlier labour laws were framed before or soon after Independence and no longer reflected current economic realities. The unified Codes introduce universal minimum wages, mandatory timely payment of wages, and compulsory appointment letters for all categories of workers.

Workers across sectors, including gig, platform, contract, migrant, women and MSME workers, will now be covered under a harmonised framework of rights and protections. ESIC (Employees’ State Insurance Corporation) coverage has been expanded nationwide, including to establishments employing even one worker engaged in hazardous processes. Fixed-term employees will be eligible for gratuity after one year, instead of the earlier five-year threshold.

The new framework also mandates gender-neutral wages, permits women to work night shifts subject to prescribed safety measures, and provides free annual health check-ups for workers above 40. Gig and platform workers will, for the first time, receive social-security benefits financed partly through aggregator contributions.

Compliance has been made easier through a single registration, single licence, and single return, replacing the need for multiple filings. A new inspector-cum-facilitator system will focus on guidance instead of only enforcement, while faster industrial tribunals aim to speed up dispute resolution.

The Industrial Relations Code has also been overhauled to simplify how disputes are handled, how unions are recognised, and how companies manage workforce flexibility without compromising worker protection. It formalises work-from-home arrangements in the services sector, expands the definition of “worker,” and introduces two-member tribunals to speed up conflict resolution. Retrenched workers will additionally receive 15 days’ wages through a new reskilling fund to help support job transitions.

Sector-specific rules include double wages for overtime, stricter safety standards for mines and hazardous industries, and mandatory safety committees in larger workplaces. Additional protections extend to IT/ITES, plantations, ports, export units, beedi and cigar units, textiles, and audio-visual media.

The Government said these changes bring India’s labour system closer to global standards and support the “Aatmanirbhar Bharat” goal by improving both worker welfare and industry productivity. During the transition, older laws will remain in force until the new rules under each Code are finalised after consultations.

The Centre noted that India’s social-security coverage has risen from 19 per cent of the workforce in 2015 to over 64 per cent in 2025, and said implementation of the labour codes represents the next major step in building a “protected, productive and future-ready workforce.”