How the new Labour Codes will benefit workers with better wages, social security and safety
4 new labour codes: The new reforms set uniform wage rules, stricter safety norms and easier compliance for employers.
India’s new Labour Codes came into effect on Friday, replacing 29 older labour laws and marking one of the biggest reforms in the country’s labour system.
The four codes: the Code of Wages (2019), Industrial Relations Code (2020), Code on Social Security (2020) and the Occupational Safety, Health and Working Conditions Code (2020), bring all major labour rules under one modern framework aimed at improving worker welfare and expanding protections across sectors.
The new laws set uniform wage rules, stricter safety norms and easier compliance for employers.
Also Read | Four labour codes most comprehensive, progressive reforms since Independence: PM Modi
Prime Minister Narendra Modi also welcomed the reforms with a “Shramev Jayate” message, calling them the most comprehensive and progressive changes introduced since India's independence.
"India's new Labour Codes strengthen the rights of every worker--formal, informal and gig. These reforms ensure better wages, safety, and dignity for our workforce. A major stride towards Viksit Bharat."
Union Labour Minister Mansukh Mandaviya also praised the rollout, writing:
"Modi Government’s Guarantee: Dignity for Every Worker! From today, the new labour codes have been made effective in the country. They will ensure:
• A guarantee of timely minimum wages for all workers
• A guarantee of appointment letters for the youth
• A guarantee of equal pay and respect for women
• A guarantee of social security for 40 crore workers
• A guarantee of gratuity for fixed-term employees after one year of employment
• A guarantee of free annual health check-ups for workers above 40 years of age
• A guarantee of double wages for overtime
• A guarantee of 100% health security for workers in hazardous sectors
• A guarantee of social justice for workers as per international standards"
He said the changes are “not just ordinary changes” but a major step towards building a self-reliant and developed India by 2047.
What do the new Labour codes offer for different sectors?
Fixed-Term Employees (FTE)
• Equal benefits as permanent workers (leave, medical, social security).
• Gratuity eligibility after 1 year instead of 5.
• Equal wages to permanent staff.
• Reduces over-contractualisation and promotes direct hiring.
Gig & Platform Workers
• Clear definitions for gig work, platform work, and aggregators.
• Aggregators to contribute 1–2% of turnover (capped at 5% of payouts to workers) to social security.
• Aadhaar-linked Universal Account Number for fully portable welfare.
Contract Workers
• FTE structure increases employability and ensures equal benefits.
• Gratuity after 1 year for fixed-term workers.
• Principal employer to provide health and social security benefits.
• Free annual health check-up.
Women Workers
• Legal ban on gender discrimination.
• Equal pay for equal work.
• Permission for night shifts and all types of work with consent and safety measures.
• Mandatory women representation in grievance committees.
• Parents-in-law included in dependent definition for benefits.
Youth Workers
• Guaranteed minimum wage.
• Appointment letters for all workers.
• Mandatory payment of wages during leave.
• Wages based on national floor wage.
MSME Workers
• Full coverage under Social Security Code.
• Guaranteed minimum wage.
• Access to canteens, water, rest spaces.
• Standard working hours, double overtime pay, paid leave.
• Timely wage payment.
IT & ITES Workers
• Salary must be released by the 7th of every month.
• Equal pay and stronger women participation.
• Women allowed night shifts with safety.
• Quick dispute resolution for harassment and wage issues.
• Mandatory appointment letters and social security coverage.
Cross-Sector Reforms
• National Floor Wage for minimum living standards.
• Gender-neutral pay and job opportunities, including for transgender persons.
• Inspector-cum-Facilitator for guidance-based compliance.
• Faster dispute resolution via Industrial Tribunals.
• Single registration, licence, and return across codes.
• National OSH Board for unified safety standards.
• Mandatory safety committees in establishments with 500+ workers.
• Updated factory applicability limits to ease compliance for smaller units.
