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Implementation of the Four Labour Codes - Effective 21 November 2025
On 21 November 2025, The Code on Wages, 2019, The Industrial Relations Code, 2020, The Code on Social Security, 2020 and The Occupational Safety, Health & Working Conditions Code, 2020, - together referred to as the "Four Labour Codes" - have been formally made effective across India. The move rationalises 29 older labour laws and marks a significant shift in India's labour-regulatory architecture.
What is Changing:
The Labour Codes introduce a modernised, and streamlined structure for the governance of wages, social security, industrial relations, and workplace health and safety.
The Codes bring several major changes.
- The consolidation and simplification of laws aim to reduce multiple registrations, licenses, and returns, by introducing a single registration, a single license, and a single electronic return.
- Worker rights and coverage are expanded: for example, minimum wage protection across unorganised and organised sectors, defined social security rights for gig and platform workers, and revised safety and working-condition norms.
- Compliance and enforcement mechanisms are modernised: decriminalisation of certain offences in favour of fines, an "inspector-cum-facilitator" role, and digitised processes to ease the regulatory burden.
The Prime Minister described the implementation of the Labour Codes as "one of the most comprehensive labour-oriented reforms since Independence," highlighting the objectives of strengthening worker welfare, simplifying compliance for enterprises, and preparing the labour ecosystem for emerging sectors and employment models. The Government emphasised that the Codes aim to create a predictable, transparent, and future-ready regulatory environment.
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Our Comments
The notification of the Labour Codes initiates a significant period of adjustment for organizations. As the corresponding rules are finalised, businesses may find it helpful to reassess key areas such as wage structures, payroll processes, employee benefits, working-hour policies, statutory registers, and HR systems in light of the harmonised definitions and compliance themes introduced by the Codes.
From an assurance standpoint, organizations may consider the following focus areas during this transition period:
- Review the completeness and accuracy of employee-related records (wage components, benefits, attendance, overtime, and statutory registers).
- Evaluate internal controls connected to payroll processing, employee benefit calculations, and statutory compliance under the existing laws.
- Map current HR, payroll, and compliance processes against the emerging themes and structural changes outlined in the Labour Codes.
- Assess documentation readiness, including appointment letters, policy documents, registers, and reporting formats, for future alignment.
- Monitor Central and State-level rule notifications to understand jurisdiction-specific requirements and operational timelines.
- Develop a structured readiness plan to support a smooth and controlled transition once all operational rules are fully notified.
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