What's Happening?
India has implemented four Labour Codes, effective November 21, 2025, replacing 29 existing labor laws. These codes aim to modernize labor governance, ensuring better wages, social security, and occupational
safety. Key features include mandatory appointment letters, universal social security coverage, statutory minimum wages, and free annual health check-ups for workers over 40. The codes also allow women to work night shifts and extend ESIC coverage nationwide, simplifying compliance and enhancing worker protections.
Why It's Important?
The implementation of these Labour Codes marks a significant reform in India's labor policy, aligning with global standards and addressing outdated regulations. By enhancing worker welfare and simplifying compliance, the codes are expected to boost productivity and attract investment. The inclusion of gig and platform workers in social security coverage is a major step towards formalizing the gig economy. These reforms could lead to a more resilient and competitive workforce, supporting India's economic growth.
What's Next?
The Indian government will work with state governments to ensure a smooth implementation of the new codes. Draft rules will be published for public comment, and final rules will be established after consultations. Businesses will need to adapt to the new regulatory framework, which may involve changes in employment practices and compliance systems. The government will also focus on building digital infrastructure to support the new system.
Beyond the Headlines
The Labour Codes address gender equality by allowing women to work in all sectors, including night shifts, with safety measures. This could increase female workforce participation and contribute to economic empowerment. The recognition of gig workers and the extension of social security benefits to them is a significant step towards formalizing the gig economy, which is expected to grow substantially in the coming years.
