INTRODUCTION
India’s consolidation of 29 labour laws into four new codes is one of the most significant overhauls of labour regulation in independent India. By merging and rationalising numerous central labour statutes into a streamlined framework, the new Codes seek to simplify compliance, widen worker protection, and encourage a more uniform regulatory environment across sectors. Although the reforms seek to update obsolete laws and bring scattered provisions under a unified framework, its real impact will hinge on how consistently it is implemented and how effectively emerging gaps are resolved on the ground.
BACKGROUND
Over time India’s labour framework expanded through numerous separate statutes dealing with wages, industrial relations, social security, workplace safety and related matters. With growing industrial diversification, these scatters laws created overlaps, inconsistencies and procedural burdens for both employers and workers. Recognising the need for simplification, the Second National Commission on Labour (2002) proposed merging central labour enactments into few coherent codes. Acting on this long – pending recommendation, Parliament enacted four major Labour Codes such as, the Code on Wages, 2019; the Industrial Relations Code, 2020; the Occupational Safety, Health and Working Conditions Code, 2020; and the Code on Social Security, 2020. Together, they subsume over 25 existing statutes. The government’s new notification of the Codes signifies India’s shift towards a more streamlined labour framework designed to prioritize clarity, ensure consistency and facilitate easier compliance.
KEY FEATURES OF THE FOUR LABOUR CODES
- Code on Wages, 2019:
This code consolidates, and rationalizes the provisions of four existing laws- The Payment of Wages Act, 1936; The Minimum Wages Act, 1948; The Payment of Bonus Act, 1965; and The Equal Remuneration Act, 1976. It brings all major wage related laws under one roof to ensure employees receive fair, timely, and uniform wages. By introducing a national wage floor, it therefore ensures to reduce disparities between states and create a more consistent wage system across the country.
- Industrial Relations Code, 2020:
This code has been prepared after amalgamating, simplifying and rationalizing the relevant provisions of the Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946 and the Industrial Disputes Act, 1947. It streamlines laws on trade unions and industrial disputes while setting clearer rules for hiring, layoff, and retrenchment. It encourages smoother employer – employee engagement through fixed term employment and more efficient dispute resolution procedures.
- Occupational Safety, Health and Working Conditions Code, 2020:
This Code has been drafted after amalgamation, simplification and rationalization of the relevant provisions of the 13 Central Labour Acts- The Factories Act, 1948; The Plantations Labour Act, 1951; The Mines Act, 1952; The Working Journalists and other Newspaper Employees (Conditions of Service and Miscellaneous Provisions) Act, 1955; The Working Journalists (Fixation of Rates of Wages) Act, 1958; The Motor Transport Workers Act, 1961; The Beedi and Cigar Workers (Conditions of Employment) Act, 1966; The Contract Labour (Regulation and Abolition) Act, 1970; The Sales Promotion Employees (Conditions of Service) Act, 1976; The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979; The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981; The Dock Workers (Safety, Health and Welfare) Act, 1986 and; The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996.
The Code balances the twin objectives of safeguarding worker rights and safe working conditions, and creating a business-friendly regulatory environment. Its core focus is to guarantee improved working hour regulations and enforce stricter welfare provisions for employees across all sectors.
- Code on Social Security, 2020:
This code incorporates the nine existing Social Security Acts such as, The Employee’s Compensation Act, 1923; The Employees’ State Insurance Act, 1948; The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952; The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959; The Maternity Benefit Act, 1961; The Payment of Gratuity Act, 1972; The Cine-Workers Welfare Fund Act, 1981; The Building and Other Construction Workers’ Welfare Cess Act, 1996 and; The Unorganised Workers’ Social Security Act, 2008.
It expands social security protection to a broader workforce, including unorganised, gig and platform workers. This code seeks to foster a more inclusive and secure support system for the modern workforce by broadening the availability of protections such as insurance, pension plans, and maternity benefits.
RECENT DEVELOPMENTS
Current legislative and regulatory evolution continue to shape the functional landscape of the four Labour Codes. The question of extending social security to gig and platform workers is currently before the Supreme Court in the case of, The Indian Federation of App-based Transport Workers (IFAT) v. Union of India [W.P.(C) No. 1068/2021], where petitioners argue that excluding such workers from statutory protection violates Articles 14 and 21. At the same time, issues relating to contract labour and regularisation remain influenced by the principles laid down in Secretary, State of Karnataka v. Uma Devi (2006) 4 SCC 1, which restrict automatic regularisation of temporary workers. Another case Ms. X v. Internal Complaints Committee, ANI Technologies Pvt. Ltd. & Ors [(2024) SCC Online Kar 3793] the Karnataka High Court held that OLA driver – subscribers could be treated as “employees” for the purposes of the POSH Act (Sexual Harassment of Women at Workplace Act), ordered the internal complaints committee to act and imposed compensation. This is a recent, highly relevant HC decision that shows one Indian High Court recognising statutory protection for gig workers.
These judicial precedents, coupled with ongoing state level actions to extend welfare to gig and informal workers, reflect the evolution of the environment into which the Labour Codes will ultimately be implemented.
CONCLUSION
The consolidation of diverse labour statutes into four broad Labour Codes marks a significant reorientation of India’s labour regulation framework. By restructuring a previously scattered set of laws, the Codes seek to minimise uncertainty, reinforce worker protections, and promote easier compliance. However, their true effectiveness will depend on how well they are implemented, ensuring that procedural simplification does not erode substantive rights and that administrative systems can meet the expectations of both employers and workers. As industries, regulators, and the judiciary engage with the new framework, its contours will continue to develop through practical application and judicial interpretation.
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WRITTEN BY- SUSMITA ROYCHOWDHURY
