EPFO: In a major overhaul of India’s labor framework, the government on Friday implemented all four labor codes, replacing 29 existing laws. Officials described it as the biggest reform in the sector since independence. These codes—on wages, industrial relations, social security, and occupational safety and health—come into effect today.
This move brings together decades-old labor regulations, which were scattered across multiple laws, into a coherent framework. Many of these old laws date back to pre- and post-independence eras and were considered largely outdated for an economy experiencing rapid formalization and a shift to new ways of working.
Four labor codes – the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 – are coming into effect from November 21, 2025, overhauling 29 existing labor laws. By modernizing labor regulations, enhancing worker well-being, and aligning the labor ecosystem with the changing world of work, this historic step lays the foundation for a future-ready workforce and strong, resilient industries that will drive labor reforms for a self-reliant India.
PF will be deducted, insurance benefits will be available
These reforms will provide significant relief to temporary workers. They will also receive pensions. All workers, including gig and platform workers, are required to provide appointment letters for social security coverage. All workers will receive PF, ESIC, insurance, and other social security benefits.
Employers must provide free annual health check-ups to all workers over the age of 40. Employers are required to pay salaries on time. Women are permitted to work at all workplaces and at night.
The terms “gig work,” “platform work,” and “aggregators” are defined for the first time. Aggregators will be required to pay a share of 1–2% of annual turnover, limited to 5% of the amount paid/payable to gig and platform workers.
Many of India’s labor laws were enacted before independence and in the early post-independence era (1930s–1950s), at a time when the economy and the world of work were essentially different. While larger economies have updated and strengthened their labor regulations in recent decades, India continues to operate under fragmented, cumbersome, and in many ways outdated rules spread across 29 central labor laws. These restrictive frameworks struggled to adapt to changing economic realities and evolving employment patterns, creating uncertainty and increasing compliance burdens for both workers and industries.
The implementation of four labor codes has addressed this long-standing need to move beyond colonial-era structures and align with modern global trends. Together, these codes strengthen both workers and companies, creating a workforce that is safe, productive, and adapts to the changing world of work—paving the way for a stronger, more competitive, and self-reliant nation.
Benefits of labor reforms in key sectors
Fixed-Term Employee (FTE): FTEs receive all the same benefits as permanent workers, including leave, medical care, and social security. Gratuity eligibility is increased after one year instead of five. Salary, income, and protection are increased to match those of permanent staff. Direct hiring is encouraged and excessive contract work is reduced.
Gig and platform workers: The terms ‘gig work’, ‘platform work’, and ‘aggregator’ have been defined in the labor law for the first time. Aggregators will be required to pay a share of 1–2% of annual turnover, limited to 5% of the amount paid/payable to gig and platform workers. Aadhaar-linked Universal Account Numbers will make welfare benefits easily accessible, fully portable, and available across all states, regardless of migration.
Contract workers: Fixed-term employment (FTE) offers improved job prospects and guaranteed legal protections, such as social security and benefits comparable to those of permanent employees. Fixed-term employees are eligible for gratuity after one year of continuous service. The principal employer will provide health benefits and social security benefits to contract workers.
