India implements sweeping labour reforms despite union opposition

"India has announced a sweeping set of labour reforms, saying it will implement four long-delayed labour codes that the government says will modernise outdated regulations and extend stronger protections to millions of workers. Prime Minister Narendra Modi said on X on Friday that the overhaul would provide a strong foundation for universal social security, minimum and timely payment of wages, safe workplaces and remunerative opportunities."

"The labour ministry echoed that message, saying the reforms place workers, especially women, youth, unorganised, gig and migrant workers, firmly at the centre of labour governance, with expanded social security and portable entitlements that apply nationwide. The government says replacing 29 fragmented laws with four unified codes covering wages, industrial relations, social security and occupational safety will simplify compliance and make India more attractive for investment."

"Many of India's existing labour laws date back to the British colonial era and have long been criticised by businesses as complicated, inconsistent and a barrier to scaling up manufacturing, an industry that still accounts for less than 20 percent of India's nearly $4-trillion gross domestic product (GDP). The new rules formalise changes approved by parliament in 2020 but stalled for years due to political resistance and pushback from several states and unions. The reforms introduce significant shifts in how factories operate."

Four unified labour codes replace 29 fragmented laws to cover wages, industrial relations, social security and occupational safety. The reforms extend social security and portable entitlements nationwide, targeting women, youth, unorganised, gig and migrant workers. The changes formalize measures approved in 2020 and aim to simplify compliance, attract investment and strengthen manufacturing growth. Operational shifts include allowing women to work night shifts, increased scope to extend working hours, and raising the threshold for prior approval for layoffs from 100 to 300 workers. The reforms respond to criticism that older laws were outdated, complex and hindered scaling of industry.

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