New Labour Codes in India 2025

India is entering a new era of workplace reforms. With the new labour codes 2025 coming into force from 21 November 2025, the government aims to make workplaces more fair, secure, and future-ready. These new labour laws promise better protection for workers while simplifying compliance requirements for businesses.

Whether you are an employee, a business owner, a gig worker, or someone planning a career in industry, these reforms impact you directly. Let’s explore how.

What Has Changed in Labour Codes of India?

The new labour codes 2025 combine 29 old labour laws into just four simplified and comprehensive codes:

1. Wages 
2. Social Security 
3. Industrial Relations 
4. Occupational Safety 

Fewer complications, clearer rules, and more inclusive protection—that’s the direction India is moving toward.

New Labour Code India 2025 Details

1. Universal Minimum & Floor Wage

Every worker—whether in organised or unorganised sectors—will now receive wages based on a centrally determined floor wage.
States must set their minimum wages higher than this floor, ensuring:

• A dignified standard of living 
• Reduced wage inequality across different regions 

2. Expanded Social Security Coverage

Under the latest labour codes, social security benefits will now cover all types of workers, including gig and platform workers such as drivers, delivery partners, freelancers, and more.
Aggregator platforms must donate 1–2% of annual revenue to a social security fund.

3. Uniform Definition of Wages

“Wages” now include:

• Basic pay 
• Dearness allowance 
• Retaining allowance 

At least 50% of total salary must fall under core wage components so that workers receive fair PF, gratuity, and leave encashment benefits.

4. Mandatory Appointment Letters

For the first time in Indian labour history, even informal workers and fixed-term employees must receive formal appointment letters, ensuring clarity and legal protection for both sides.

5. Timely Wage Payments

Employees earning up to ₹24,000/month are now legally entitled to timely salary payments under the new labour laws.
Overtime must be paid at twice the regular wage.

6. Recognition of Work-from-Home

Service-oriented businesses can now officially offer work-from-home, adding flexibility for both employers and employees.

7. Gender Equality and Safe Workplaces

The new labour codes reinforce:

• Equal pay for equal work 
• Night shift opportunities for women with safety arrangements and consent 
• Mandatory representation of women in grievance committees 

8. Better Benefits for Fixed-Term Employees

Fixed-term workers will now:

• Receive gratuity after 1 year (earlier 5 years) 
• Enjoy benefits equivalent to permanent employees 

9. Layoffs & Closures – Greater Stability for Workers

Industries now need government approval for layoffs or closures only if 300 or more workers are employed (previously 100), helping maintain workforce stability.

10. Simplified Compliance for Factories

Factories are now defined as units with:

• 20 workers (with power) 
• 40 workers (without power) 

A single licence, single registration, and single annual return make compliance much easier for businesses.

11. Faster Dispute Resolution

Labour disputes will now be addressed by two-member tribunals, speeding up case disposal and reducing backlog.

Sector-Wise Impact of the New Labour Codes 2025

Major Structural Reforms

• Inspector-cum-Facilitator Model: Officials will guide businesses toward compliance rather than only penalising them. 
• Decriminalisation: Minor offences now attract monetary penalties instead of imprisonment. 
• National Safety Board: A central board will set uniform occupational safety standards across industries. 

Criticism and Challenges

Despite the benefits, some concerns exist:

• Trade unions fear that workers’ right to strike may become more limited. 
• Some small businesses worry about compliance expenses. 

To ensure smooth implementation, companies are being given time to adjust to the new labour codes 2025, and more stakeholder discussions are expected in the near future.

Final Thoughts

The new labour laws are a transformative reform for India. By modernising outdated systems, recognising gig workers, formalising employment structures, and improving workplace safety, the new labour codes 2025 take India closer to global labour standards.

These reforms aren’t just legal changes—they represent a future where:
businesses can grow with less compliance pressure, and
workers can feel secure, respected, and fairly treated.