Labour Codes Notified | Update

The Ministry of Labour and Employment (“Ministry”) has notified the four labour codes (“New Labour Codes”) as of 21 November 2025.  The overarching objective of the New Labour Codes is to establish a more streamlined, uniform, and future-ready labour law framework aimed at strengthening worker protection, improving productivity, and broadening social security coverage across sectors and categories of employees. The New Labour Codes seek to simplify and modernise the existing regulatory architecture while simultaneously introducing several significant compliance obligations for employers. Organisations will be required, among other things, to compute social security contributions in accordance with the revised definition of “wages”, provide annual leave encashment to eligible employees, restructure CTC components, and establish a grievance redressal committee.

That said, the complete operationalisation of the Codes will ultimately depend on the notification and enforcement of the corresponding Central and State Rules. Further guidance from the Ministry in the coming weeks will be essential to facilitate a smooth transition and to address the practical challenges arising from this phased implementation.