New Labour Laws: Employees in India are celebrating the introduction of 4 primary new labour laws by the Indian government that improves the ease of doing business, formalize employment, and boost workplace safety.
The reforms are positioned as cornerstones for improving ease of doing business, enhancing workplace safety, fostering inclusive growth, and promoting formalization, while also aligning with stringent global standards. The new labour laws [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] also encourage wage and gender parity, national floor wage for all, provisions for night shifts for women with certain safeguards, and enhanced safety & health norms.
What Has Changed For Employees?
The new labour laws mandate extended social security benefits to unorganized sector, platform workers, gig, and fixed term employees. The new labour laws also propose free health checkup for employees of the age of 40 years and above, appointment letter, contract labour regulations, migrant worker protections, and timely payment rules being applied to all employees.
The code grants all employees in both organized and unorganized sectors a statutory right to minimum wages. Earlier, the Minimum Wages Act covered only scheduled employments that included about 30% of workers. Now, no state can set minimum wages below the national floor wage, ensuring uniform and adequate pay across the country.
The four codes also require employers to pay all employees overtime wages at no less than twice the normal rate for work done beyond regular hours. Employees now receive compensation for accidents that occur while traveling between home and the workplace, as such journeys are now considered employment-related.
What Has Changed For Businesses?
From a business perspective, digitized and simplified compliance will reduce litigation risk and administrative burden, improving investor confidence. Parallely, initiatives by the Indian government for digital transformation such as EPFO 3.0, etc. will promote trust and transparency.
The laws were enacted after deliberations held in the tripartite meeting of the Government, various trade unions, and employers’ industry representatives during 2015 to 2019. The new labour laws that were notified on November 21, 2025, will be fully operational from April 1, 2026. Since labour is a concurrent subject, both Center and states have to notify the rules under the four new labour laws to enforce them fully throughout the country.
