Labour & Employment

Changes in New Labor Codes in India

By 19/01/2022March 3rd, 2022No Comments
new labor codes in india

Understanding Labor Laws & New Labor Codes in India

A labor-intensive country like India has revisited its new labor codes in India and its labor laws. In 2019, the Ministry of Labor and Employment had effectively introduced four Bills to strategically amalgamate 29 central laws.

It is to be noted that these 29 central laws were related to labor laws which were consequently simplified and modernized. Thus, the revision of the laws led to the much-needed revisal and simplification of the labor regulations in a labor-intensive country, like India.

To get a gist of what was strategically regulated in the laws, it is to be noted that wages, social security, and Industrial Relations were thoroughly scrutinized and regulated. On the other hand, attempts were also made to regulate the laws pertaining to health, Occupational Safety, and Working Conditions.

new labor codes

All such aforementioned provisions were codified and enacted effectively as the Code on Wages, 2019; the Occupational Safety, Health and Working Conditions Code, 2020; The Industrial Relations Code, 2020 and the Code on Social Security, 2020

Given the aforementioned acts, what actually were the changes on the ground level that were made by the government? In the labor laws, it was established that the Central Government will be emphatically the ‘appropriate government’. The central government will act as an “appropriate government” for the public sector undertakings.

Here, it is worthy of mentioning that the government will act in such capacity even if the central government’s holding in the entity is less than 50%. Certain industries that have qualified where the central government will act as the appropriate government are the specific industries banking, mines, telecom, and railways.

Talking about the occupational safety and health of the workers, an ‘Inspectnew changes in labour laws in indiaors-cum-Facilitators’ shall be established. This shall be effectively established as the new authority under the Code on Social Security, 2020, the Occupational Safety, Health and Working Conditions Code, 2020, and The Industrial Relations Code, 2020.

The duty of an inspector-cum-facilitator will emphatically be to provide information and reports to industry employees. Thus, the newer labor codes take into consideration the well-being and the interests of the laborers in the economy.

Given that India is a labor-intensive country, with a high contribution of the manufacturing sector in the economy, the address of core issues of the laborers will help in addressing the deep-seated problems and discrepancies that might threaten the efficiency of the labor.

labour law codes

Talking about the social security code, 2020, the code was emphatically introduced to provide social security benefits to the labor class, which are the most deprived social class. This has been strategically done by extending the goals of social security goals to employers and employees.

The code has also worked to emphatically simplify the labor laws by effectively amalgamating various enactments. such as:

The code positively states that the central government will be responsible to frame the social security schemes. This will be done by giving utmost importance to providing benefits under Employees‘ State Insurance Corporation (ESIC) for platform workers, gig workers, and unorganized workers.

In fact, the code also strongly empowers the central government to extend its social security benefit schemes to self-employed persons in the economy. Thus, given that the reins are in the hands of the government, one can maintain that welfare will be positively delivered as the state’s main motive is to deliver justice and protect the welfare of the society.

Thus, given the aforementioned changes and alterations in the new labor codes in India, one can emphatically state that it will lead to redressal of widespread hostilities and discrepancies in the labor system which has been haunting the efficiency and welfare of the labor class.

Given that the government will be gaining reins in the matters of labor laws, one can expect significant improvement in the conditions of the labor class in India, which is thoroughly deprived of justice and rightful means of survival and sustainability.

The act garners all the more important due to the fact that the labor class has suffered inexplicably due to the pandemic that has exacerbated the woes of the labor class. Thus, the new labor code emphatically introduces various special provisions for accommodating better regulations for industries.

This is being done by establishing flexible norms and allowing the industries to be flexible to foster efficiency and commitment to the work. Further, one can state that the ambiguity surrounding certain provisions has been cleared with clear codification and consolidation of the laws.

In fact, it can be positively stated that the codification and consolidation of such laws have positively led to the expansion of the ambit and effective applicability of the laws. Thus this has increasingly helped with ease of compliance and removal of an unnecessary multiplicity of definitions.

Thus, consequently, the reluctance that had seeped into the system due to inefficient and uncodified roles of the overlapping of authorities has been thoroughly removed.

What is more one can positively state about the newer labor code is that the new set of rules will definitely and positively empower the relationship between the employee, the employer, and the government, which will lead to faster resolution of the issue that plague the labor class.

impact of new labour codes in india

This will also be bn=beneficial for the employees if the labor class is appreciative of the system and thus, ultimately their employer. Thus, in totality, the newer laws will definitely lead to a positive long-term impact on the labor industry and will strengthen further contribute towards the idea of ease of doing business in the economy.

Given that the economy is still in the nascent stage of its recovery and is under threat from the newer variant namely omicron, a little breather for the employees and the employers will contribute highly to the industry’s revival.


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