Dear Sirs,
The Government of India has implemented the four consolidated Labour Codes with effect from 21 November 2025, replacing 29 existing Central labour laws. These Codes significantly streamline regulatory requirements while enhancing worker welfare, social security, and workplace safety. To support your organisation’s transition, we have prepared a concise comparative summary outlining the practical impact of the new regime.
- Comparative Overview: Existing Practice vs New Practice
| Compliance Area | Existing Practice (Earlier Laws) | New Practice under Labour Code 2025 |
| Appointment Letters | Not uniformly mandatory | Mandatory issuance of appointment letters to all workers, ensuring documentation and formalisation |
| Minimum Wages | Applied only to scheduled industries | Statutory minimum wages extended to all categories of workers |
| Release of Wages | Sector-specific or inconsistent timelines | Mandatory timely payment; uniform timelines (e.g., salary for monthly-rated employees to be released promptly) |
| Social Security Coverage | PF/ESI coverage limited to specific categories and locations | Universalised social security for all workers including gig, platform, migrant, contract, and fixed-term employees |
| Annual Health Check-ups | No statutory requirement | Free annual health check-up mandatory for all workers aged 40 and above; sector-specific mandatory coverage for certain categories |
| Women in Night Shifts | Restrictions on night work and certain occupations | Women permitted to work in all establishments and night shifts with consent and prescribed safety measures |
| Gig & Platform Workers | No statutory definition or dedicated protection | Gig and platform workers legally recognised; aggregators required to contribute 1–2 percent of turnover to their social-security fund |
| Gratuity Entitlement | Eligible after 5 years of continuous service | Fixed-term employees eligible after 1 year of continuous service |
| Working Hours | Varied across industries | Standardised working hours of 8–12 hours per day and 48 hours per week |
| Compliance Filings | Multiple registrations, licences, and returns across various labour laws | Single registration, PAN-India single licence, and single return across Codes |
| Contract Labour | Inconsistent application of benefits | Contract workers entitled to social security, health benefits, and annual health check-ups; parity in certain benefits with permanent employees |
| Safety & OSH Standards | Disparate standards across sectors | Harmonised national standards under the OSH Code; mandatory safety committees for units with 500 or more workers |
| Dispute Resolution | Fragmented and time-consuming processes | Faster adjudication through two-member Industrial Tribunals and streamlined conciliation workflow |
- Key Implications for Employers
A. HR and Documentation Updates – Employment contracts, appointment letters, HR manuals, standing orders, and compliance registers will require updating to align with the new statutory definitions, wage structures, and worker categories.
B. Payroll and Wage-Structure Alignment – Organisations must reassess wage components and payroll processes to ensure timely disbursements, adherence to minimum-wage requirements, and proper computation of social-security contributions.
C. Workforce Classification and Social Security – Businesses must identify and classify all workers, including fixed-term, gig, platform, and contract labour, to ensure complete social-security coverage and benefits compliance.
D. Enhanced Safety, Health, and Welfare Obligations – The Codes introduce uniform national standards for workplace safety, annual health examinations, and mandatory establishment-level committees. These requirements will impact operational SOPs and compliance documentation.
E. Streamlined Compliance Framework – The single-registration and single-return system simplifies processes but requires early preparation to transition internal compliance workflows to the new regime.
- How We Can Assist
Our firm can support your organisation with:
- Review and redrafting of employment contracts, HR policies, and appointment formats
- Compliance gap audit based on the four Labour Codes
- Guidance on workforce restructuring, fixed-term engagement, and third-party contract labour
- Payroll and wage-structure review under Code on Wages, 2019
- Preparedness documentation for audits and inspections
- Sector-specific advisory for IT/ITES, manufacturing, MSMEs, logistics, export-oriented units, and gig-economy platforms
Please feel free to contact us for a detailed compliance roadmap or assistance in implementing the necessary changes.