India: Progress for the New Labour Codes

Some progress has been made towards the full implementation of India’s four new, harmonised Labour Codes. The central government has implemented the Codes on Social Security, Wages, Occupational Health, Safety and Working Conditions, and Industrial Relations at the federal level.

However, this only applies to undertakings for which the central government is the “appropriate government” under the Codes. In practice, this is largely public sector undertakings and businesses owned or controlled by the central government, typically in sectors such as railways, ports, mines, telecoms, banking and insurance. The central government may also be the “appropriate government” for certain private entities operating across multiple States.

The position remains incomplete at State level. Where a State government is the “appropriate government”, the new Codes will only apply once implemented locally and, to date, most States have not done so.

For now, employers must continue to assess compliance on a Code-by-Code and State-by-State basis. Full harmonisation of Indian labour law remains some way off.

Overview of the Codes that now apply at Central Government Level

Social Security Rules:  The Social Security Rules establish the institutional and administrative framework for applying the Code, including processes for appeals. They also expand health and welfare spending under the Employees’ State Insurance scheme and clarify the position on a range of other employee benefits.

Wages Rules: The Wages Rules provide clarification on the calculation of minimum wages and the scope of permissible deductions.

Occupational, Health, Safety and Working Conditions Rules: The Occupational Health, Safety and Working Conditions Rules set out key operational requirements for workplace health and safety, including provisions on annual medical examinations, safety committees, and recording and reporting obligations. They also address hiring practices and employment contract terms, with existing contracts requiring updates to reflect mandatory provisions. Certain administrative processes are streamlined, including the introduction of a single annual return filing system to replace multiple registers.

Industrial Relations Rules: The Industrial Relations Rules focus on workplace dispute resolution, including the framework for works committees and grievance redressal mechanisms.

This is a high-level general update only. Legal advice should be obtained on specific circumstances.