The government introduced four labour codes consolidating 29 laws to streamline compliance, enhance workers' rights, and promote business ease through modernized, unified regulations across sectors.
In Summary
The historic reform streamlines compliance, modernizes outdated provisions, and creates a simplified, efficient framework that promotes ease of doing business while safeguarding workers’ rights and welfare.
Labour Code
Laws it Subsumed
Key-Provisions
Code on Wages, 2019
Code replaces the following four laws:
Payment of Wages Act, 1936.
Minimum Wages Act, 1948.
Payment of Bonus Act, 1965.
Equal Remuneration Act, 1976.
Establishes a statutory right to minimum wages for all employees across both organized and unorganized sectors.
Employers shall not discriminate on the basis of gender, including transgender identity, in recruitment, wages.
Provisions ensuring timely payment and preventing un-authorized deductions will apply to all employees, irrespective of wage limits.
Fixed Term Employment (FTE): Allows direct, time-bound contracts with full parity in wages and benefits; gratuity eligibility after one year.
Higher Threshold for Lay-off/Retrenchment/Closure: Approval limit raised from 100 to 300 workers; States may enhance the limit further.
Expanded Worker Definition: Covers sales promotion staff, journalists, and supervisory employees earning up to ₹18,000/month.
Code on Social Security, 2020
Subsumes 9 Labour Acts like
Employees' Compensation
Act, 1923, Maternity Benefit
Act, 1961, etc.
All workers including gig & platform workers to get social security coverage.
Expanded ESIC (Employees' State Insurance) Coverage: ESIC now applies pan-India, eliminating the criteria of “notified areas.”
Occupational Safety, Health and Working Conditions Code, 2020
Subsumes 13 Labour Acts
like Factories Act, 1948,
Plantation Labour Act, 1951,
Mines Act, 1952 etc.
Employers must provide all workers above the age of 40 years with a free annual health check-up.
Extension to Hazardous Work: Government can extend the Code’s provisions to any establishment, even with one employee, engaged in hazardous or life-threatening occupations.
