4 labour codes take effect nationwide: Here's what's changing for workers

New labour Code 2025: New rules promise better wages, wider social security and simpler compliance effective from today.

The Union government has brought all four labour codes into effect starting Friday, marking the biggest overhaul of India’s labour framework in decades. According to the Press Information Bureau (PIB), the move consolidates 29 central labour laws into a simplified system aimed at improving worker welfare, reducing compliance burden and aligning India’s labour ecosystem with global standards.

 

Many of the older laws go back to the 1930s-50s, creating overlaps and inconsistencies. The government says the new codes, Code on Wages (2019), Industrial Relations Code (2020), Code on Social Security (2020) and Occupational Safety, Health and Working Conditions Code (2020), make the regulatory framework “future-ready” and support both workforce protection and industry growth.

 

What changes for workers in New labour Code 2025

 

Universal minimum wages and timely pay

The Code on Wages guarantees minimum wages for all workers, moving away from the earlier system where wage protection applied only to scheduled industries. Timely wage payment is now mandatory, aimed at improving financial stability and reducing distress.

 

Expands social security

The Code on Social Security extends protection to gig workers, platform workers and all categories of employees. Benefits such as EPF, ESIC, insurance and gratuity become widely accessible. Gig and platform aggregators will contribute 1-2 per cent of annual turnover, capped at 5 per cent of payouts to workers.

 

Health and safety

Workers above 40 will receive free annual health check-ups. Sectors such as mining, hazardous industries, plantations and docks will have stronger safety requirements. Women can work in all occupations, including night shifts and hazardous roles, with mandatory safety measures.

 

Appointment letters for all

Employers must issue appointment letters to all workers, important for proving employment history, securing loans and accessing formal benefits. 

 

Benefits for specific worker groups

Fixed-term employees: To receive benefits equal to permanent staff, gratuity eligibility cut to one year.

 

Women workers: Protected from discrimination; allowed night shifts with consent; equal pay mandated.

 

Youth and MSME workers: Guaranteed minimum wages, formal employment records and timely wages.

 

Textile and migrant workers: Access to equal wages, welfare schemes and portability of PDS benefits.

 

IT/ITES employees: Salary must be released by the 7th of every month; faster resolution of workplace disputes.

 

Audio-visual and media workers: Mandatory appointment letters and protection for overtime and wage delays.

 

What changes for employers in new Labour Law

• The government highlights major compliance simplification:
• Single registration, single licence and single return across codes.
• Inspector-cum-facilitator system to support compliance rather than penalise.
• National OSH Board to create unified safety standards.
• Higher applicability thresholds for factories to ease burden on small units.

 

The government also plans further stakeholder consultations while transitioning from old regulations. Existing rules will continue where required until new schemes are notified.

 

Why the labour codes matter for households

 

For millions of families, these changes could mean:

 

• More predictable income through minimum wages and timely payments
• Lower financial risk due to wider social security
• Improved job opportunities for women and youth
• Greater protection for gig and platform workers, who are increasingly central to urban livelihoods

 

With the move, the government aims to build a pro-worker, pro-women and pro-employment labour environment, the PIB release noted.