India’s New Labour Codes 2025: Key Changes You Must Know Pre vs Post Reforms

India’s labour landscape has undergone a historic transformation with the introduction of four new labour codes, effective from November 21, 2025. These reforms aim to modernise employment practices, expand worker protections, and simplify compliance for businesses. The new codes replace fragmented, outdated laws with a uniform framework, ensuring a future-ready workforce and stronger industries under Aatmanirbhar Bharat.

Key Changes Pre vs Post Labour Reforms

Aspect	Pre-Reform Scenario	Post-Reform Scenario
Formalisation of Employment	No mandatory appointment letters.	Written appointment letters are mandatory for all workers.
Social Security Coverage	Limited coverage; gig and platform workers mostly excluded.	All workers, including gig and platform workers, receive benefits like PF, ESIC, insurance, and other social security schemes.
Minimum Wages	Applied only to scheduled industries; many workers uncovered.	Statutory right to minimum wages for all workers with timely payment under Code on Wages, 2019.
Preventive Healthcare	No legal requirement for free health check-ups.	Employers must provide annual free health check-ups for all workers above 40 years.
Timely Payment of Wages	No mandatory compliance.	Employers must pay wages on time, ensuring financial security for workers.
Women Workforce Participation	Restrictions on night shifts and certain jobs.	Women allowed in all occupations, including night shifts, with proper consent and safety measures; equal opportunity for higher earnings.
ESIC Coverage	Limited to specific industries and establishments; hazardous-process units often excluded.	ESIC extended Pan-India; voluntary for <10 employees, mandatory for hazardous-process units, expanding social protection for all workers.
Compliance Burden	Multiple registrations, licenses, and returns across various laws.	Single PAN-India registration, single license, and unified return system, reducing administrative complexity.

1. Written Appointment Letters Made Mandatory

Previously, employers were not legally required to issue appointment letters. The new labour codes now mandate written appointment letters for all workers, ensuring transparency and clear employment terms.

2. Minimum Wages Now Statutory for All Workers

Earlier, minimum wages applied only to scheduled industries, leaving millions without protection. Post-reform, all workers have a legal right to minimum wages, ensuring fair compensation across sectors.

3. Universal Social Security Coverage

The Code on Social Security, 2020 extends benefits such as health insurance, provident funds, and pensions to all employees, including gig and platform workers who were previously outside the formal system.

4. Enhanced Workplace Safety and Conditions

The Occupational Safety, Health and Working Conditions Code, 2020 mandates safer and healthier workplaces. Employers must adhere to strict safety protocols, ensuring better protection for all employees.

5. Simplified Industrial Relations

The Industrial Relations Code , 2020 streamlines processes for strikes, layoffs, and dispute resolution. This modern framework reduces administrative burdens and provides clarity for both employers and workers.

6. Easier Compliance and Regulatory Oversight

The new labour codes consolidate 29 existing laws, eliminating overlapping regulations. This rationalisation simplifies compliance, making it easier for businesses to operate while protecting workers’ rights.

7. Focus on Women and Youth Empowerment

Prime Minister Modi highlighted that the reforms promote Nari Shakti and Yuva Shakti by ensuring equal opportunities, fair pay, and safe workplaces for women and young workers in India.

8. Timely Payment of Wages Guaranteed

The Code on Wages ensures that all employees receive salaries on time, with legal recourse for delayed payments. This strengthens financial security for the workforce.

9. Modernisation for the Digital and Gig Economy

Recognising changes in the economy, the codes address gig, contract, and platform workers, integrating them into the formal system with clear rights and protections.

10. Strengthening India’s Economic Growth

By providing legal clarity, protecting workers, and simplifying compliance, the new labour codes aim to boost job creation, attract investment, and create a resilient, competitive workforce.

India’s new labour codes mark the most significant reforms since independence, creating a balanced ecosystem for workers and employers alike. From guaranteed minimum wages to enhanced safety and social security, these codes lay a strong foundation for economic growth, employment protection, and inclusive development in the 21st century.