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29 old labor laws enacted before and after independence (1930-1950) have now been subsumed into four new codes. These are the Wage Code, the Industrial Relations Code, the Social Security Code, and the Occupational Safety Code. The government argues that today’s economy and working methods are completely different from those of the past, and therefore, regulations should also be modern.
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New Delhi: The central government has implemented four new labor codes, replacing old labor laws. Union Labor and Employment Minister Mansukh Mandaviya described this as a historic step taken by Prime Minister Narendra Modi for the welfare of workers. The purpose of these reforms is not just to change the law, but to provide dignity, security, and economic strength to every worker. Giving information on social media, PM Modi wrote, "Today our government has implemented four labor codes. These are among the most comprehensive and progressive worker-centric reforms since independence. They empower workers significantly, make compliance easier, and also promote ease of doing business."
400 million people get 'shield'
29 old labor laws enacted before and after independence (1930-1950) have now been subsumed into four new codes. These are the Wage Code, the Industrial Relations Code, the Social Security Code, and the Occupational Safety Code. The government argues that today's economy and working methods are completely different from those of the past, and therefore, regulations should also be modern.
The biggest change concerns the "Appointment Letter." It is now mandatory for every employee to provide an appointment letter upon joining. This will bring transparency and curb corporate arbitrariness. Furthermore, approximately 400 million workers in the unorganized sector have now been brought under the ambit of Social Security. This means they will also be able to access benefits like PF, ESIC, and pension.
Meanwhile, India's Minister of Labor and Employment, Mansukh L. Mandaviya, clarified on the social media platform "X" that these reforms will prove to be a milestone towards making India a developed nation by 2047. Let's understand in detail how the implementation of these new rules will change the life of an ordinary employee.
Gratuity even after 1 year of service
The biggest good news for private sector employees concerns 'Fixed Term Employees' (FTE). Previously, gratuity was required for five consecutive years with the same company, which often deprived employees. Under the new rules, fixed-term employees are now eligible for gratuity after just one year of service.
Furthermore, the situation regarding overtime has been clarified. If an employee works more than the stipulated hours, they will be paid double the normal wage. Strict provisions have been made to ensure timely payment of wages, so that no one faces financial stress at the end of the month.
New doors of advancement open for women and gig workers
The new labor code places special emphasis on gender equality. Women will now be able to work night shifts, provided their safety is ensured and their consent is obtained. This move will provide women with equal opportunities in high-paying jobs and across industries (such as mining). Women are also guaranteed equal pay for equal work.
For the first time, "gig and platform workers" working on platforms like Zomato, Swiggy, Ola, and Uber have been defined in a legal framework. Aggregators will now be required to contribute 1-2% of their annual turnover to the welfare of these workers. Through their Aadhaar-linked Universal Account Number (UAN), they will be able to avail of their benefits from anywhere in the country.
Special care for employees over the age of 40
Health has been prioritized along with work. According to the new rules, employers will be required to provide free health checkups once a year for all employees over the age of 40. This step has been taken to ensure timely identification of serious illnesses and the health safety of employees.
In addition, 100% health coverage has been guaranteed for workers working in hazardous sectors. The scope of ESIC has now been expanded nationwide, allowing even those working in small organizations to access medical care. Separate provisions have also been made for the MSME, textile, and IT sectors to ensure balanced working hours and prevent exploitation of employees.
