New Labour Codes Explained: Nearly everyone is impacted by the new framework, regardless of whether they work full-time, under contract, or in industry-specific positions like media, plantations, or factories. Along with a few other significant changes that haven’t gotten enough attention, these are the main updates that employees should be aware of.
India’s new labor laws have finally taken effect, replacing a patchwork of previous legislation with a single, more comprehensive set of regulations. Everyday necessities like pay, leave, working hours, and workplace security are all impacted by these changes.
Nearly everyone is impacted by the new framework, regardless of whether they work full-time, under contract, or in industry-specific positions like media, plantations, or factories.
Along with a few other significant changes that haven’t gotten enough attention, these are the main updates that employees should be aware of.
GRATUITY FOR FIXED-TERM EMPLOYEES AFTER A YEAR
All labor laws now have a common definition of wages, which has changed how benefits are determined. Gratuity is one of the largest shifts.
Workers hired on time-bound contracts, such as those in IT, manufacturing, media, logistics, and services, are now eligible after just one year of service rather than five.
This official recognition “gives employers hiring flexibility while ensuring workers are not left without basic protection,” according to Kartik Narayan, CEO of Apna’s Jobs Marketplace.
PAID LEAVE IS EASIER TO GET
Workers must now work 180 days to receive annual paid leave. The previous threshold was 240 days. Seasonal or shift-heavy workers who couldn’t meet the longer eligibility period benefit from the lower requirement.
CLEARER HOURS AND BETTER OVERTIME PAY
The eight-hour workday and forty-eight-hour workweek remain, but governments can now schedule four long days, five medium days, or six standard days.
States can now allow higher overtime limits and require voluntary, double-pay overtime.
Narayan says this framework “balances flexibility for employers with safety and predictability for workers.”
MUST NOW GET APPOINTMENT LETTERS
Every employee must receive a written appointment letter detailing wages, duties, hours, and benefits. The ambiguity many workers, especially in services, trades, and media, have faced is gone.
MINIMUM WAGE FOR ALL SECTORS
Minimum wages are now mandatory, not just in scheduled industries. No state can set wages below the Centre’s national floor wage.
This universalizes wage protection.
WILL HOME PAY LOWER?
If employers don’t adjust the CTC, take-home pay may decrease as more pay falls under the statutory wage base and attracts higher PF or gratuity deductions.
PAID ON TIME FOR ALL WORKERS
Previously, timely-wage rules applied only to low-wage workers. Now every worker is covered. Penalties for late salaries strengthen financial security.
WORKPLACE INCIDENTS INCLUDE COMMUTE-RELATED ACCIDENTS
Under certain circumstances, an accident that occurs while a worker is traveling between their home and place of employment will be considered an employment-related accident. Access to insurance, ESI benefits, and compensation is improved as a result.
ESIC COVERAGE GROWS IN INDIA
No longer limited to notified areas, ESI. Coverage is now available for factory, shop, plantation, and hazardous one-person workers.
This increases the availability of maternity benefits, disability insurance, and health insurance.
MEDIA, DIGITAL, AND AUDIO-VISUAL WORKERS’ FORMAL PROTECTION
Formal appointment letters outlining pay, working hours, and benefits must now be sent to journalists, OTT employees, digital creators, dubbing artists, and crew members.
This closes a long-standing regulatory gap in the internet and creative industries.