On November 21, 2025, barely a week after the Bihar election, which saw the National Democratic Alliance coalition return to power in the State, the Central government notified the four Labour Codes that had been passed by Parliament between 2019 and 2020: the Code on Wages, the Industrial Relations (IR) Code, the Code on Social Security, and the Occupational Safety, Health and Working Conditions (OSHWC) Code. The codes are being touted as the biggest labour reform in decades, with the claim that 40 crore unorganised sector workers will be legally guaranteed fair wages. It is also claimed that the codes aim at expanded social security, stronger protections for workers, and nationwide portability of entitlements. The codes also promise to boost employment by reducing compliance burdens and enabling flexible and modern work arrangements.

In the name of simplification, the codes have amalgamated 29 labour laws in one stroke, either diluting or deleting many of the protective features that were built into them even before Independence by the persistent efforts of activists, lawyers, and trade union leaders. It is widely assumed that the Bihar victory emboldened the government to notify the codes now even though they were passed by Parliament five years ago, since when there has been protracted resistance from most trade unions.

The resistance is not new. Even earlier governments at the Centre led by the Congress tried hard to liberalise labour laws in favour of industry but failed. Today, the same Congress is part of the unified opposition bloc that is vehemently opposing the Labour Codes. During the winter session, the INDIA bloc staged protests outside Parliament as its members opposed the codes inside the House.

Meanwhile, the joint platform of 10 central trade unions that has consistently opposed the Labour Codes said they “wrecked the character of the welfare state”. The 10 unions—Indian National Trade Union Congress, Centre of Indian Trade Unions (CITU), All India Trade Union Congress, Hind Mazdoor Sabha, United Trade Union Congress, All India Coordination Committee of Trade Unions, Self Employed Women’s Association, Labour Progressive Federation, All India United Trade Union Centre, and Trade Union Co-ordination Centre—held a pan-India strike on November 26. On December 8, the trade unions met to decide that their joint platform, and sectoral federations will hold a pan-India strike in February 2026. The plan is to coordinate with the Samyukta Kisan Morcha on issues affecting the farming community.

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The government has been on an overdrive to proclaim the benefits of the codes. A Press Information Bureau release claimed that the codes heralded transformational change in the form of better wages and social security and enhanced welfare for workers. It also said that the codes laid the foundation for a “protected future-ready workforce and resilient industries, boosting employment and driving labour reforms for Atmanirbhar Bharat”. The codes aligned India’s labour ecosystem with global standards, ensuring social justice for all workers, the release said.

The argument is that while global economies had moved ahead and consolidated their labour regulations, India continued under “fragmented, complex, and in several parts outdated provisions”. The existing frameworks were restrictive, by this logic, and could not keep pace with changing economic realities and evolving forms of employment, thus creating uncertainty and compliance burdens for both workers and industry.

The new Labour Codes provide for mandatory appointment letters for all workers; social security benefits such as provident fund, Employees’ State Insurance Corporation (ESIC) coverage, and insurance for gig and platform workers; minimum wages; timely wage payments; free annual health check-ups; and the option of night shifts for women, subject to consent and safety safeguards. The codes also allow voluntary enrolment under the ESIC scheme in establishments employing fewer than 10 workers.

The codes will implement fixed-term employment, or FTE (euphemism for short-term employment and hire-and-fire policy), with gratuity payable after one year instead of five. These employees will receive all the benefits of regular workers, including leave, equal wages, medical and social security benefits. It is claimed that FTE will promote direct hiring and reduce contractualisation, which is misleading since FTE itself is short-term and contractual.

The codes also claim workers will receive wages as per the floor wage determined by the Central government to ensure a decent standard of living. While this falls within the government’s “one nation-one wage” framework, there is no reference to timely and periodic wage revisions or the federal right of States to fix wages.

For gig and platform workers, the codes mandate aggregators to contribute 1-2 per cent of their annual turnover, capped at 5 per cent, to workers. MSME (micro, small, and medium enterprises) and plantation workers have been brought under the Social Security Code. For workers in mines and beedi and cigarette units, the working hours have been capped at 8 to 12 hours per day with a cap of 48 hours a week. Overtime is to be consent-based with double wages.

While women have been permitted under the codes to work in all establishments, including hazardous ones, the Centre is yet to frame national standards for improved worker safety. However, a national Occupational Safety and Health Board is to be set up, with mandatory safety committees in establishments with more than 500 workers. But there is no clarity on such a requirement in units with fewer workers.

New features such as the inspector-cum-facilitator office appear to be aimed more at compliance support for industry than at punitive action for violations. Other features such as a faster dispute resolution system or raising factory applicability limits to ease the regulatory burden for small units validate the apprehensions of trade unions who see the codes as essentially anti-labour and the logic of simplification of labour laws as a fig leaf.

The CITU issued a statement saying the codes “dismantle job security, dilute the role of labour departments, and push the entire workforce into precarious employment”. In the absence of employers’ obligations and an enforcement mechanism, it said, the promise of universal social security to all workers, including gig and platform workers, was meaningless. With no employer-employee relationship in gig work, social security assurances are less likely to work.

The CITU pointed out that the Central government’s present Rs.168-per-day floor wage was lower than the minimum wage in several States. The floor wage, trade unions say, is not a minimum wage. A formula for computing the minimum wage exists, based on calorific and non-food requirements, but the codes give no commitment on that.

The retrenchment, lay-off, and closure threshold (requiring government permission) has been raised to 300 workers, from the earlier 100. This, the government claims, will allow increased FTE intakes in 90 per cent of workplaces. There was no evidence to show that diluting workers’ rights increased employment, said the CITU.

CITU national secretary R. Karumalaiyan asked how social security coverage (state insurance or PF) could be universal when the eligibility threshold for social security in manufacturing segments had been raised. Earlier, Karumalaiyan said, even factories employing a few workers had to extend social security, but “given the raised thresholds, many workers would be out of the purview of the law itself”. He pointed out that less than 4 per cent of the workforce was covered by social security. “Without state funding, how can the government claim it will ensure universal social security?” he asked.

Speaking of safety rules, Karumalaiyan said the 1979 Inter-State Migrant Workermen Act had been diluted. Earlier, anyone recruiting even 5 people from another State was liable for the safety of all 5; now they are liable only when 50 or more are hired. Merely issuing appointment letters was meaningless, he said, without mandatory registration of establishments. Even if the intent in the codes was to be believed, there was no means of ascertaining if employers were complying as all they needed now was to self-certify compliance.

“As an employer, I can declare that I provide separate restrooms for women, have proper ventilation in the premises, etc. No physical verification is needed any longer. But ILO norms say that physical inspection of all safety norms is the lifeline of the law,” he said. Earlier, a district magistrate could inspect premises on the basis of a complaint, but that has now been replaced by randomised inspections.

Stakeholder consultations were not held, claimed Karumalaiyan. “The last Indian Labour Conference [ILC], the highest tripartite body for policy decisions concerning labour, was held in 2015. Despite trade unions demanding that the government convene the ILC annually, it has not been done. There were some consultations in 2017. Then the government put up the codes on the [Ministry of Labour and Employment] website. That is not stakeholder consultation. In fact, the codes do away with the tripartite character of several laws,” he said.

Interestingly, it is not just opposition party trade unions that are contesting the new codes. Since 2014, despite its comfortable majority, the government has not been able to muster even the full support of the Bharatiya Mazdoor Sangh (BMS), ideologically affiliated to the RSS.

While the BMS did not participate in the joint action by the 10 other central trade unions and welcomed the implementation of the Labour Codes on its website, it has repeatedly expressed reservations over the IR and OSHWC codes. It has asked the government to begin consultations, indicating that the government’s claims of having held robust stakeholder consultations are not entirely true. “It is imperative that the government begin consultations without further delay,” stated a BMS memorandum to the Labour Minister on November 21, the day the Labour Codes were notified, noting that the IR and OSHWC codes contain “several provisions that are not worker-friendly”.

Aware of the unease within its own cadre, the BMS memorandum listed objections to the IR and OSHWC codes, urged the government to convene the ILC “at the earliest”, and listed a series of demands pertaining to social security and welfare measures for workers and regularisation of contractual contract workers.

The BMS memorandum noted that in its national office-bearers’ meeting held in Raipur on November 12-14, 2025, the organisation “resolved to conduct a nationwide campaign on this issue from December 15 [to December] 20, 2025”. The “issue” was the BMS demand for the implementation of the codes on wages and social security and for consultations on the other two.

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The BMS has made common cause with other unions on issues such as the threshold for retrenchment and closure being raised to 300, the restrictions on trade unions, curtailing the right to strike, reducing retrenchment notice pay from three months to one in establishments with up to 300 workers, the new definition of wages that excludes house rent allowance and fixed-term employment, and the neglect of domestic workers. Regarding health and safety, BMS general secretary Ravindra Himte pointed out that the new codes gave the government arbitrary powers to modify awards and had overly broadened exemptions. The BMS letter also pointed out that the OSHWC Code had increased the applicability threshold for factories from 20 to 50 workers.

Threshold limits have been similarly raised for inter-State migrant workers, working journalists, motor transport workers, and others. For working journalists, the notice period has been reduced from three months to one month, and the retrenchment threshold has been raised from 20 employees to 300. The provision for displacement allowance for inter-State migrant workers is missing, and the prohibition on engaging contract labour in perennial work has been diluted.

The BMS memorandum, too, reminded the government that it has been 10 years since the last Indian Labour Conference and spoke of the alarming increase in contractual employment across government departments, public sector undertakings, boards, corporations, autonomous institutions, societies, and the private sector. Regardless of industry complaints about increased wage or social security costs under the new Labour Codes, the workers’ unions themselves are clear that the codes give the workers a bad deal overall. With the cons clearly outweighing the pros, they must be reworked.