Government of India implements four new labour codes: A landmark reform in labour governance
On 21 November 2025, the Government of India took a historic step by implementing the long-awaited four Labour Codes — Code on Wages (2019), Industrial Relations Code (2020), Code on Social Security (2020), and Occupational Safety, Health and Working Conditions Code (2020).
This landmark reform comes nearly five years after their initial introduction and represents a major overhaul of India’s labour governance framework. By consolidating 29 existing labour laws into a simplified and unified structure, these Codes aim to enhance regulatory clarity, improve compliance efficiency, and address evolving workforce dynamics. The move underscores the government’s commitment to modernising labour regulations, ensuring better protection for workers while enabling ease of doing business for employers across sectors.
With the notification on 21 November 2025, the uncertainty surrounding the enforcement of the Labour Codes has now been resolved. Consequently, the substantive phase begins — encompassing transition, interpretation, formulation of rules, development of schemes and standards, and their effective implementation at the ground level.
What are the four labour codes
The Code on Wages, 2019
Amends and consolidates the laws relating to wages and bonus and matters connected therewith or incidental thereto
The Social Security Code, 2020
Seeks to amend and consolidate the laws relating to social security with the goal to extend social security to all employees and workers either in the organised or unorganised or any other sectors and for other incidental or related matters
Industrial Relations Code, 2020
Consolidates and amends the laws relating to trade unions, conditions of employment in industrial establishments, investigation and settlement of industrial disputes and for all other incidental or related matters
Occupational Safety, Health & Working Conditions Code, 2020
Focussed on consolidating and amending the laws regulating the occupational safety, health and working conditions of the persons employed in an establishment and for all other incidental or related matters
Which labour codes are implemented—and to what extent?Â
Industrial Relations Code, 2020 and Occupational Safety, Health and Working Conditions Code, 2020 have been implemented in its entirety.
The Code on Social Security, 2020 has been brought into effect, with certain exclusions, including the non-repeal of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
The Code on Wages, 2019 has also been implemented, with certain exclusions related to the constitution of the Central Advisory Board.
How the codes impact businesses
Key areas of consideration
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Payroll
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HR function
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Financial impact
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Policies
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Manpower composition review
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How Grant Thornton Bharat can help
Detailed assessment, i.e., comparing existing with new provisions
- Review compensation structure and benefits
- Review existing HR processes and policies
- Review employment and other contracts
- Map/compare the prescribed guidelines under the codes as applicable
- Presentation before the management and stakeholders
Transition
- Assist in revising compensation structure, policies, contracts, etc.
- Worker v/s employee analysis
- Assist in putting plan in place for transition to new codes
- Assist in creating the process ownership structure and align internal department, management and other stakeholders
Implementation and compliance
- Assist in compliances under new codes
- Provide handholding support over a fixed period
- Assist with implementing any change in provisions, clarifications, notified after the effective date
- ERP system changes and change management
Why Grant Thornton Bharat
Transitioning to a new legislative framework is not a one-time activity but a journey. At Grant Thornton Bharat, we are well-equipped to assist our clients as we navigate this legislation change, which will impact employers across industries.
Single point of contact
A dedicated project manager who will act as your single point of contact
Empaneled regulators
Ex-regulators from EPFO empanelled with us to cater to clients’ requirements
Tailored-made solutions
Well-defined communication protocols to provide agile and responsive services
Robust reporting and commitment to timelines
Ensure timely and robust reporting for swift management decision making
We have a team of committed professionals, comprising experienced CAs, Lawyers, and Company Secretaries, with expertise across Payroll, Tax, Labour laws, Company Law and Regulatory domains to help us cover all aspects of the engagement.
Decoding Labour Codes: The dawn of a new era
We hosted a webinar titled ‘Decoding Labour Codes: The dawn of a new era’ on the new Labour Codes, which came into effect on 21 November 2025. Our experts shared practical guidance on proactive worker classification, compliance with new wage definitions, documentation for social security benefits, digital readiness for streamlined reporting, and the importance of strategic workforce planning across HR, finance, and legal teams.
