VB-G RAM-G (Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025)

Implications for Rural Employment, Fiscal Design, and Development Outcomes

1. Background and Context

The VB-G RAM-G Act, 2025 represents a significant recalibration of India’s rural employment framework. By replacing the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the Government of India has sought to modernise the legal and operational architecture of rural employment in line with evolving socio-economic realities and the long-term vision of Viksit Bharat 2047.

While MGNREGA functioned primarily as a demand-driven social safety net, VB-G RAM-G introduces a development-linked employment model, seeking to combine income security with strategic rural asset creation.

2. Key Policy Design Features

2.1 Expanded Employment Guarantee

Statutory guarantee increased from 100 to 125 days per rural household.

Retains rights-based access to wage employment for unskilled labour.

Policy implication:

This expansion signals continued commitment to income security while acknowledging the persistence of rural underemployment.

2.2 Shift from Demand-Driven to Planned Works

Introduction of structured village-level development planning.

Works aligned with pre-identified development outcomes rather than ad-hoc demand.

Policy implication:

The approach enhances asset quality and economic relevance but may reduce spontaneity in employment access during distress periods if not managed flexibly.

2.3 Strategic Asset Creation Framework

Projects are organised under four thematic pillars:

1. Water security and conservation
2. Core rural infrastructure
3. Livelihood-supporting assets
4. Climate resilience and disaster mitigation

Policy implication:

This reorientation embeds rural employment within national productivity and climate agendas, potentially improving long-term rural incomes.

2.4 Revised Fiscal and Funding Architecture

Introduction of normative allocations instead of open-ended wage funding.

Greater emphasis on Centre–State cost sharing and fiscal predictability.

Policy implication:

Improved budget discipline and planning certainty, with the trade-off of increased dependence on state fiscal capacity and administrative efficiency.

2.5 Digital Integration and Monitoring

Creation of a National Rural Infrastructure Stack.

Asset digitisation, geo-tagging, and real-time monitoring.

Policy implication:

Enhanced transparency and evaluation capacity, though success depends on digital literacy and last-mile infrastructure.

3. Anticipated Economic and Social Impacts

3.1 Employment and Income Stability

Higher guaranteed workdays may smooth seasonal income volatility.

Better quality assets could indirectly generate secondary employment.

3.2 Rural Productivity and Migration

Focus on durable assets may increase agricultural productivity and non-farm livelihoods.

Potential to reduce distress migration if implementation remains inclusive.

3.3 Climate and Environmental Outcomes

Systematic inclusion of climate-resilient works strengthens rural adaptation capacity.

Long-term benefits in water conservation and disaster mitigation.

4. Governance and Implementation Considerations

4.1 Administrative Capacity

Panchayati Raj Institutions will require enhanced planning, technical, and financial management skills.

Capacity asymmetries across states may lead to uneven outcomes.

4.2 Accountability and Social Audits

Strong audit mechanisms remain critical to prevent dilution of the employment guarantee.

Community participation must remain central despite increased central planning.

4.3 Transition Risks

Shifting from a familiar framework may create short-term implementation gaps.

Clear guidelines and phased rollout are essential to maintain continuity.

5. Stakeholder Implications

Stakeholder		Implication
Rural households	-	Higher employment potential; dependency on planning quality
State governments	-	Greater fiscal and administrative responsibility
CSR & ESG actors	-	Structured opportunities for convergence and impact measurement
Researchers & think tanks	-	Rich data for evaluation of development-linked employment

6. Policy Assessment

VB-G RAM-G reflects a second-generation reform in rural employment policy — one that attempts to move beyond subsistence support toward productive inclusion. Its success will hinge on striking a careful balance between:

• Guarantee and discretion,
• Planning and responsiveness, and
• Fiscal discipline and social protection.

7. Comparative Policy: MGNREGA vs VB-G RAM-G

Parameter	MGNREGA (2005)	VB-G RAM-G Act (2025)	Policy Significance / Analytical Note
Legislative intent	Rights-based social safety net ensuring minimum wage employment	Development-linked employment guarantee aligned with national growth vision	Indicates a shift from relief-centric to productivity-oriented policy
Legal status	Statutory Act of Parliament	Statutory Act of Parliament	Employment guarantee remains legally enforceable
Guaranteed employment	Up to 100 days per rural household	Up to 125 days per rural household	Expansion reflects continued emphasis on income security
Nature of employment	Unskilled manual work	Unskilled manual work linked to strategic assets	Maintains inclusivity while enhancing asset value
Planning approach	Primarily demand-driven	Planned + outcome-oriented	Improves asset relevance but requires strong planning capacity
Scope of works	Broad permissible works list	Four defined priority pillars: water, infrastructure, livelihoods, climate resilience	Narrows focus to national development priorities
Asset creation objective	Secondary to employment provision	Central objective alongside employment	Repositions employment as a means to long-term development
Village-level planning	Annual labour budget based on demand	Viksit Gram Panchayat Development Plans	Encourages local strategic planning
Funding mechanism	Open-ended wage funding by Centre	Norm-based allocation with Centre–State cost sharing	Improves fiscal predictability; raises state capacity concerns
Wage payment system	Direct Benefit Transfer (DBT)	DBT with enhanced digital verification	Continuity with incremental digital strengthening
Transparency measures	Social audits, MIS, geo-tagging	Expanded digital stack, asset mapping, real-time monitoring	Improves evaluation and accountability
Technology integration	MIS-centric monitoring	National Rural Infrastructure Stack	Enables cross-scheme convergence and impact tracking
Climate focus	Implicit and incidental	Explicit and structured	Aligns rural employment with climate adaptation goals
Livelihood linkage	Limited	Integrated with livelihood and productivity outcomes	Enhances income sustainability beyond wages
Flexibility during distress	High (pure demand-driven)	Moderate (planning-based with safeguards)	Potential risk during sudden shocks if flexibility is constrained
Role of states	Implementing agencies	Co-planners and fiscal partners	Strengthens cooperative federalism
Political symbolism	Strong association with social justice legacy	Framed within Viksit Bharat 2047 vision	Reflects evolving policy narrative
Evaluation framework	Input and process focused	Outcome and asset quality focused	Improves policy learning and course correction

Conclusion

The VB-G RAM-G Act, 2025 marks a pivotal moment in India’s rural policy trajectory. By integrating employment guarantees with infrastructure development, climate resilience, and long-term planning, it seeks to future-proof rural livelihoods. However, the effectiveness of this transformation will depend less on legislative intent and more on institutional capacity, cooperative federalism, and sustained accountability.

The Four Labour Codes: Transforming India’s Real Estate & Construction Sector — A Balanced Analysis

The real estate and construction sector is India’s second-largest employer after agriculture, absorbing millions of workers—engineers, supervisors, contract labourers, migrant workers, machine operators, and site staff. The introduction of the four consolidated labour codes marks a significant regulatory shift for builders and developers.

These codes aim to modernise labour laws, ensure safe working conditions, streamline compliance, and expand social security. However, for the infrastructure and real estate ecosystem—characterised by subcontracting, seasonal labour, and migrant-heavy workforces—the transformation brings both opportunities and challenges. 

This article examines the positive and negative impacts of each labour code on India’s builders, developers, and real estate companies.

1. Code on Wages, 2019

Positive Impact

Uniform definition of wages (50% rule) simplifies payroll across multiple states.

Ensures timely payment, reducing disputes with workers and contractors.

Establishes a national floor wage, preventing exploitation of low-paid construction workers.

Promotes fair and transparent wage practices, improving trust at project sites.

Negative Impact

Increases the cost of labour due to higher PF, gratuity, and overtime obligations.

Forces developers to restructure wage components, raising contractor billing rates.

May lead to higher project costs and budget overruns, especially in labour-intensive projects.

2. Code on Social Security, 2020

Positive Impact

Extends PF, ESIC, gratuity, and insurance to:

Contract labour

Migrant workers

Platform and gig workers

Enhances accident insurance coverage, reducing liability risks.

Portability of benefits makes it easier for migrant labour to move across projects.

Boosts worker welfare, improving site morale and long-term retention.

Negative Impact

Substantial cost escalation as contractors must contribute to PF/ESIC for large temporary workforces.

Administrative burden of registering and tracking mobile/migrant workers.

Increased risk of non-compliance penalties for principal employers if contractors fail to comply.

Higher compliance may lead to a shortage of informal labour, affecting project timelines.

3. Occupational Safety, Health & Working Conditions(OSH) Code, 2020

Positive Impact

Stronger safety norms reduce onsite accidents and liabilities.

Mandatory provisions for:

Clean drinking water

First aid rooms

Safety officers

Protective gear

Medical check-ups

Women allowed in all roles (including night shifts) with safety measures—expanding the talent pool.

Creates a more organised and professional construction ecosystem, aligning with global standards.

Negative Impact

Compliance costs rise due to:

Safety officers

Ambulance facilities (for bigger sites)

Protective equipment

Medical facilities

Small and mid-size builders may find these obligations financially intensive.

Increased monitoring may cause frequent inspections, delaying work.

Employers may face penalties for hazardous working conditions during peak construction phases.

4. Industrial Relations Code, 2020

Positive Impact

Provides clearer frameworks for dispute resolution and grievance handling.

Simplifies hiring through fixed-term employment—ideal for project-based staffing.

Raises threshold for standing orders to 300 workers, offering flexibility for medium-sized builders.

Reduces industrial disruptions by promoting structured negotiations.

Negative Impact

Seasonal labour movements and subcontracting may still lead to frequent disputes.

Increased employee voice and unionisation potential in large projects.

Stricter rules on layoffs and closure increase legal exposure for developers managing multiple subcontractors.

Delays may occur if disputes escalate, affecting project delivery timelines.

Overall Positive Impact on Real Estate & Developers

Professionalisation of labour management across construction sites.

Higher safety and welfare standards, reducing accident risks and reputational issues.

Digital compliance (online registers, e-inspections) enhances efficiency.

Promotes ethical labour practices, supporting ESG reporting for large developers.

Brings uniformity across states—critical for developers with pan-India presence.

Overall Negative Impact on the Sector

Higher cost of construction, affecting profit margins.

Increased administrative and compliance load due to documentation and digital registers.

Contractors may increase charges, making projects costlier.

Possible labour shortages as formalisation increases costs for small players.

Tightened enforcement may cause project delays if non-compliance is identified.     

Conclusion

The four labour codes represent a major shift toward safer, more transparent, and welfare-oriented labour practices in India’s real estate and construction sector.

For builders and developers, these reforms offer long-term advantages—better workforce stability, improved safety standards, and reduced dispute risk.

However, the transition also brings short-term challenges: rising costs, compliance-heavy processes, contractor accountability, and a greater need for documentation and governance.

For the sector to fully benefit,developers will need to:

Strengthen contractor management systems

Invest in digital compliance tools

Adopt transparent wage and welfare practices

Redesign cost structures and budgets

Build safety and ESG frameworks into core operations

In the long run, the labour codes have the potential to elevate India’s construction industry to international standards—but only if implemented with preparedness, clarity, and strong on-ground governance

The New Labour Codes and Their Impact on India’s IT Industry — A Comprehensive Analysis

India’s Information Technology (IT) and IT-enabled Services (ITeS) sector is central to the country’s economic growth, global competitiveness, and digital innovation ecosystem. With more than 50 lakh professionals, flexible work models, contract-based engagements, offshore delivery centres, and round-the-clock operations, the IT industry has unique workforce dynamics that differ significantly from traditional manufacturing and service sectors.

The introduction of four consolidated labour codes —

1. The Code on Wages, 2019

2. The Industrial Relations Code, 2020

3. The Occupational Safety, Health and Working Conditions Code, 2020

4. The Code on Social Security, 2020

marks the most significant overhaul of India’s labour regulatory ecosystem since Independence.

These codes aim to simplify compliance, bring uniformity, promote worker welfare, and align India's labour regime with modern, flexible, digital-economy realities.

For the IT industry — known for long hours, global customers, hybrid workforces, distributed teams, and high attrition — these changes carry far-reaching implications.

This article presents a detailed, professional, and industry-specific analysis of how the four labour codes impact IT companies, employees, and the broader digital economy.

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1. Code on Wages, 2019 – Implications for IT Compensation Structures

The Code on Wages is particularly relevant for the IT sector because it influences how organisations structure salaries, bonuses, allowances, and variable pay.

1.1 Uniform Definition of Wages — The 50% Rule

The Code introduces a standardised definition of “wages.”
Basic pay + DA + retaining allowance must form at least 50% of total compensation.

Impact on IT Companies

Most IT firms currently have salary structures with:

• Low basic pay

• High allowances

• Performance-linked components

These structures were designed for tax efficiency and cost optimisation.

Under the new rule:

• Basic pay may need to be increased

• Statutory obligations like PF, gratuity and bonus may rise

• CTC (cost-to-company) structures may need redesigning

This will particularly affect:

• Gig developers

• Contract IT staff

• Project-based IT workers

• Companies with multinational benchmarking

1.2 Minimum Wages & National Floor Wage

Although IT employees generally earn above minimum wage thresholds, the Code ensures:

• No IT employer can pay below State-notified minimum wages

• Apprentices, interns, and support staff receive statutory protection

1.3 Timely Wage Payments & Digital Wage Slips

IT companies will need to ensure:

• Strict wage-period compliance

• Automated wage slips (physical or digital)

• Timely final settlements within 2 working days of separation

Result: Greater payroll transparency and reduced disputes.

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2. Code on Social Security, 2020 – Bringing Formal Protection to a Diverse IT Workforce

The IT industry employs:

• Permanent staff

• Contract employees

• Fixed-term developers

• Freelancers

• Gig and platform workers

• Remote and hybrid employees

The Social Security Code introduces inclusive coverage for all.

2.1 PF, ESIC and Insurance Applicability

The uniform wage definition may increase PF contributions, impacting:

• Employer budgets

• Employee in-hand salary

• Long-term social security corpus

ESIC coverage expands geographically, possibly covering IT units outside notified areas.

2.2 Gig and Platform Workers

With the rise of:

• On-demand coders

• Remote contractual tech specialists

• IT freelancers

• Platform-based digital workers

The Code ensures:

• Access to welfare schemes

• Coverage for life/disability insurance

• Social Security Fund contributions from aggregators

This is the first time gig tech workers receive formal recognition.

2.3 Gratuity for Fixed-Term Employees

Fixed-term IT professionals (project-based developers, data specialists, testers) now qualify for gratuity after just one year, making IT employment more equitable.

2.4 Portability of Benefits

A unified registration system helps:

• Employees moving between IT firms

• Contract-to-full-time transitions

• Inter-state work mobility

• Remote/hybrid workforce portability

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3. Occupational Safety, Health and Working Conditions Code, 2020 – Workplace Norms for the Digital Era

While the OSH Code is often associated with factories and construction, it also significantly affects IT workplaces.

3.1 Applicability to IT Establishments

The Code applies to offices with 10 or more workers, including:

• IT parks

• BPO centres

• Development studios

• Corporate headquarters

• Remote-working clusters (in relevance to ergonomics & safety)

3.2 Health and Safety Requirements

Even for office-based IT staff, employers must ensure:

• Ergonomic seating

• Adequate ventilation and lighting

• Safe electrical and computer infrastructure

• Clean restrooms and drinking water

• Periodic medical check-ups

• First-aid availability

With rising reports of:

• burnout

• eye strain

• repetitive stress injuries (RSI)

• mental-health challenges

the wellness obligations become more relevant to IT employers.

3.3 Women Working in Night Shifts

IT/ITeS firms commonly operate 24x7 due to global time zones.
The OSH Code allows women to work night shifts but imposes:

• Mandatory consent

• Transportation facilities

• Safety escorts

• Additional workplace security measures

This impacts BPOs, cybersecurity teams, global support desks, and backend operations.

3.4 Contract Labour and Outsourcing

The Code applies to contractors with 50 or more contract labourers, impacting:

• IT temp staffing companies

• Outsourcing vendors

• Facility management providers

• Managed service partners

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4. Industrial Relations Code, 2020 – Impact on Hiring, Retrenchment, and Workforce Management

The IR Code has structural implications for large IT companies (especially with 300+ employees).

4.1 Standing Orders for IT Companies

Establishments with 300 or more workers must adopt:

• Clear rules on conduct

• Termination processes

• Work hours

• Leave policies

• Remote working conditions

• Project relocations

• Digital discipline policies

This helps bring clarity in employee relations.

4.2 Fixed-Term Employment

IT employers gain flexibility to hire on project cycles without long-term obligations, while employees retain:

• Equal benefits as permanent staff

• Pro-rata gratuity

• Equal pay protections

4.3 Retrenchment and Closure

The threshold for government permission is raised from 100 to 300 workers, giving IT companies more operational flexibility while still maintaining compensation safeguards.

4.4 Strikes and Lockouts – Notice Requirements

Given the IT sector’s critical role in global service continuity, the Code requires 14 days’ notice before strikes or lockouts.

This ensures:

• Stability of service delivery

• Reduced business disruption

• Time for conflict resolution

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5. Digital Compliance – A Major Advantage for IT Companies

The Labour Codes encourage:

• Online registrations

• Digital registers

• Web-based inspections

• Electronic filings

• Randomised, tech-enabled inspection mechanisms

For a tech-driven industry, digital-first compliance:

• Reduces administrative costs

• Minimises disputes

• Improves transparency

• Enhances corporate governance

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6. Key Advantages for the IT Industry

• More flexibility in hiring models

• Increased clarity in employment contracts

• Predictable compliance and dispute resolution

• Better safety and security protocols for night-shift operations

• Broader coverage for gig developers and contract professionals

• Improved social security and wellness initiatives

• Reduced litigation due to standardised definitions and processes

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7. Challenges the IT Sector Must Prepare For 

1. Rising Cost Implications

The 50% wage rule increases:

PF contributions

Gratuity obligations

Bonus calculations

This affects payroll budgets, especially for large IT workforce clusters.

2. Reduced Flexibility in Compensation Design

Companies lose room to structure:

Allowance-heavy CTCs

Variable pay

Special skill-based incentives

Potentially impacting talent competitiveness.

3. Transition & Operational Burden

Compliance requires:

Payroll restructuring

HR policy revisions

Multi-state harmonisation

Contract updates

Creating short-term administrative challenges.

4. Ambiguities for Remote & Hybrid Work

The Codes do not fully address:

Home-office safety norms

Remote work accident liability

Ergonomic standards at home

Inspection feasibility

Leaving HR/legal teams with grey areas.

5. Higher Liability for Contract Labour

Stricter contractor compliance under OSH and IR Codes increases risk for principal employers who rely heavily on third-party staffing.

6. State-Level Variations

Implementation varies across states, creating uncertainty for IT firms operating pan-India

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8. Strategic Recommendations for IT Companies

To adapt effectively, IT organisations should:

• Rework compensation structures to comply with the 50% wage rule

• Build digital HR-compliance systems

• Formalise work-from-home ergonomics and safety policies

• Strengthen POSH, security, and night-shift protocols

• Train HR, payroll, and compliance teams on new rules

• Reassess outsourcing and contract-labour models

• Enhance mental health & well-being programmes.                         

Conclusion

The four labour codes collectively push India’s IT sector toward a more transparent, structured, and worker-centric employment regime. They strengthen social security, standardise wages, enable flexible workforce models, and shift compliance to a digital-first framework.

However, they also bring increased financial commitments, restrict compensation flexibility, and create transitional challenges—particularly in hybrid work settings and contractor-heavy environments.

Overall, the Codes represent a long-term opportunity for better workforce governance, but demand careful adaptation, policy clarity, and strategic planning to manage short-term complexities                                                                                    

The Industrial Relations Code, 2020 – A Comprehensive and Professional Overview

The Industrial Relations Code, 2020 (IR Code) is one of the four consolidated labour codes enacted by the Government of India to modernise, simplify and harmonise the country’s complex labour regulatory framework. By merging and rationalising key laws relating to trade unions, industrial disputes and employment conditions, the Code aims to bring clarity, transparency and balance to the relationship between employers and workers.

The Code replaces three important legislations:

·       The Industrial Disputes Act, 1947

·       The Trade Unions Act, 1926

·       The Industrial Employment (Standing Orders) Act, 1946

Through this consolidation, the IR Code seeks to create a predictable industrial relations climate, promote ease of doing business, and protect worker rights in a rapidly evolving economic landscape.

1. Objectives of the Industrial Relations Code, 2020

The Code aims to:

Streamline and simplify multiple labour laws

Promote industrial harmony through structured dispute-resolution mechanisms

Provide flexibility to businesses while safeguarding employee rights

Encourage formalisation and fair employment practices

Strengthen trade union governance and accountability

Foster transparency in layoffs, retrenchment and closure processes

Ultimately, the Code attempts to strike a balance between labour welfare and business competitiveness.

2. Key Definitions

2.1 Worker

A person employed on wages to perform manual, supervisory, technical or skilled work. Certain categories above prescribed wage thresholds are excluded.

2.2 Employee

A broader category that includes workers as well as managerial, administrative and supervisory staff.

2.3 Employer

Includes the owner, occupier, manager, legal representative or any authorised person responsible for supervising an establishment.

2.4 Industrial Establishment

Covers all units engaged in industry, business, trade or manufacturing, including plantations and mines.

2.5 Strike & Lockout

The Code provides uniform definitions and prescribes notice requirements for both.

3. Major Provisions of the IR Code

3.1 Trade Unions: Recognition & Regulation

Trade unions can be registered if they meet the minimum membership criteria.

The Code introduces the concept of a “Negotiating Union” (single union with 51% membership) or a “Negotiating Council” (multiple unions collectively having majority membership).

The purpose is to streamline negotiations and avoid multiplicity of unions causing disputes.

Impact:

Promotes structured collective bargaining and reduces industrial fragmentation.

3.2 Standing Orders – Wider Applicability but Simplified Compliance

Standing Orders (rules regarding conditions of employment) are mandatory for establishments with 300 or more workers (increased from earlier threshold of 100).

A model Standing Order notified by the Government can be adopted, reducing procedural burdens.

Impact:

Gives employers flexibility while ensuring employees receive clarity on service conditions.

3.3 Layoff, Retrenchment & Closure – Ease of Doing Business with Safeguards

For establishments employing 300 or more workers:

Prior permission of the appropriate Government is required for:

Layoffs

Retrenchments

Closure of establishments

The threshold has been raised from 100 to 300 workers.

Impact:

Provides businesses with greater operational flexibility.

Workers remain protected through compensation norms, notice periods, and dispute-resolution mechanisms.

3.4 Dispute Resolution Framework

The IR Code restructures dispute mechanisms to reduce litigation and encourage alternative resolution:

Works Committees, Grievance Redressal Committees, and Industrial Tribunals

Conciliation officers appointed for pre-litigation settlement

Two-member Industrial Tribunals with judicial and administrative expertise

Provision of voluntary arbitration with the consent of both parties

Impact:

Faster dispute settlement and reduced industrial unrest.

3.5 Notice Requirements for Strikes & Lockouts

A uniform 14-day notice period is mandatory before:

Strikes by workers

Lockouts by employers

Strikes and lockouts are prohibited:

During conciliation or tribunal proceedings

In establishments covered under public utility services

Impact:

Ensures industrial actions occur only after structured negotiation attempts.

3.6 Re-Skilling Fund for Retrenched Workers

The Code introduces a Re-Skilling Fund financed by employer contributions (equal to 15 days’ wages per retrenched worker).

Funds are to be used to train workers who lose employment due to retrenchment.

Impact:

Supports worker transition and employability in a modernising industry.

3.7 Fixed-Term Employment

Employers may hire workers on fixed-term contracts without restrictions on renewal.

Fixed-term employees receive:

Equal treatment as permanent workers

Pro-rata gratuity

Statutory benefits from day one of employment

Impact:

Provides flexibility to industry while ensuring labour protections.

4. Digital-First Compliance Approach

The IR Code emphasises:

Electronic maintenance of registers

Online submission of returns

Digitised approvals and certifications

This reduces paperwork and enables transparent monitoring.

5. Benefits to Employers

Reduced regulatory confusion

More predictable industrial dispute processes

Flexibility in hiring and restructuring

Higher threshold for retrenchment/closure permissions

Digital compliance reduces administrative burden

6. Benefits to Employees

Clearer rights under Standing Orders

Stronger grievance redressal mechanisms

Protection against unfair labour practices

Recognition of negotiating unions enhances collective bargaining

Re-skilling support during retrenchment

Pro-rata gratuity and benefits for fixed-term workers

Challenges & Practical Considerations

Despite its advantages, implementation challenges remain:

States must notify rules for complete operationalisation

Organised and unorganised sectors may differ in compliance capacity

Worker awareness and training on new dispute mechanisms is essential

Concerns about increased retrenchment threshold may need careful monitoring

Balancing business flexibility with long-term job security still requires vigilance

Key Takeaways

The IR Code brings three major labour laws into a single unified Act.

It provides greater clarity in industrial relations and dispute-resolution frameworks.

Workers benefit from stronger protections, union recognition, and re-skilling provisions.

Employers gain flexibility through digital compliance, fixed-term employment, and a higher threshold for permission-based retrenchment/closure.

Its long-term success hinges on State-level rule-making, effective implementation, and stakeholder awareness.

Conclusion

The Industrial Relations Code, 2020 is a pivotal step in reshaping India’s labour landscape. By modernising dispute-resolution mechanisms, establishing structured collective bargaining, digitising compliance, and balancing worker welfare with business needs, the Code paves the way for a more stable, transparent and growth-oriented industrial environment.

As India progresses toward a more dynamic labour economy, the effective implementation of the IR Code will be essential in ensuring industrial harmony, protecting worker rights, and supporting business competitiveness.

The Occupational Safety, Health and Working Conditions Code, 2020 (OSH Code)

 

Introduction

The Occupational Safety, Health and Working Conditions Code, 2020 (OSH Code) represents one of the most significant reforms in India’s labour regulatory framework. As part of the Government’s broader labour law consolidation initiative, this Code amalgamates 13 central labour enactments into a single, coherent legislation governing workplace safety, health standards, working conditions, and employee welfare.

The overarching objective is unmistakable:

To simplify compliance, establish uniform safety norms, enhance worker protection, and promote business efficiency through streamlined and transparent regulations.

The OSH Code marks a structural shift towards a modern, digitised, and welfare-centric labour ecosystem.

1. Purpose and Objectives of the OSH Code

The OSH Code seeks to create a balanced industrial environment where the interests of workers and employers coexist seamlessly. Key objectives include:

Ensuring safe and healthy working conditions across all sectors

Establishing standardised workplace norms

Promoting ease of doing business through unified regulations

Protecting inter-state migrant workers with specific welfare provisions

Reducing compliance burden via digital registers and single licensing

Enhancing employer accountability and creating a transparent ecosystem

Its design reflects both worker-centric reforms and industry-friendly compliance simplifications.

2. Labour Laws Consolidated Under the Code

The OSH Code subsumes the following 13 labour laws:

Factories Act, 1948

Mines Act, 1952

Dock Workers (Safety, Health and Welfare) Act

Building and Other Construction Workers Act, 1996

Contract Labour (Regulation and Abolition) Act, 1970

Inter-State Migrant Workmen Act, 1979

Working Journalists and Other Newspaper Employees Act, 1955

Motor Transport Workers Act, 1961

Beedi and Cigar Workers Act, 1966

And several others

This extensive consolidation reduces ambiguity, eliminates overlapping provisions, and empowers establishments with a unified compliance structure.

3. Applicability of the OSH Code

The Code applies to a wide array of establishments, including:

Factories, mines, and plantations

Motor transport undertakings

Newspaper and media establishments

Building and construction establishments

Contract labour engagements

Any establishment employing 10 or more workers

Additionally, certain provisions apply irrespective of worker count, particularly those governing hazardous processes.

4. Key Definitions Introduced or Rationalised

4.1 Establishment

Any place where industry, business, trade, or manufacturing activities are conducted.

4.2 Worker

A broader category encompassing:

Contract labour

Technical and operational staff

Journalists

Sales promotion personnel

Manual and skilled workers

4.3 Employer

Includes:

Contractors

Principal employers

Occupiers of factories

Legal representatives of deceased owners

4.4 Contract Labour

Workers hired through a contractor to perform work for a principal employer.

 

4.5 Inter-State Migrant Worker

A worker earning up to the prescribed wage ceiling who migrates to another state for employment—whether directly employed or through a contractor.

5. Key Provisions of the OSH Code

5.1 Registration and Licensing

Single registration for all establishments

Unified licensing for factories, contract labour, and industrial premises

Web-based registration and renewed emphasis on digital processing

Drastic reduction in paperwork and compliance duplication

5.2 Working Hours and Overtime

Daily limit: 8 working hours

Weekly limit: 48 hours

Overtime at twice the normal wage rate

Provision for flexible working arrangements, including 4-day workweeks (subject to state rules)

5.3 Workplace Safety Measures

The Code mandates extensive safety protocols, including:

Safety committees for larger establishments

Appointment of qualified safety officers

Mandatory risk assessments and emergency preparedness

Safety standards for hazardous processes

Controlled employment of women in hazardous conditions, with mandatory safeguards

5.4 Health and Welfare Standards

Employers must provide:

Hygienic and well-ventilated workplaces

Potable drinking water

First-aid boxes and medical centres

Periodic medical examinations

Canteens, restrooms, and welfare officers (based on worker thresholds)

5.5 Provisions for Women Employees

A progressive feature:

Women permitted to work in all establishments, including at night

Mandatory written consent for night shifts

Employers must ensure transportation, security, and safety during late hours

Equal opportunity in employment terms

5.6 Contract Labour Provisions

Applicable to establishments and contractors with 50 or more contract workers. Highlights:

Single mandatory licence for contractors

Principal employer accountable if contractor defaults on obligations

Parity of wages for equal work between contract and regular workers

5.7 Inter-State Migrant Workers

A strengthened welfare framework:

Aadhaar-based self-registration system

Central database for benefit portability

Mandatory journey allowance

Toll-free grievance helpline

Provisions for accommodation and essential amenities

5.8 Sector-Specific Provisions

Mines

Rigorous safety checks

Ventilation requirements

Rescue equipment

Medical exams

Factories

Machinery guarding

Hazard controls

Regulated working hours

Construction Sector

Safety harnesses and protective gear

Accident prevention protocols

Motor Transport Workers

Driving hour limitations

Rest intervals

Journalists & Media Workers

Working hour norms

Leave and welfare provisions

6. Digital Compliance Framework

A major reform under the OSH Code is the shift toward technology-driven compliance, featuring:

Digital registers and online returns

Computerised random inspection system

Web-based licences

Increased transparency in enforcement

This digitisation significantly reduces harassment, manual errors, and administrative delays.

7. Penalties and Enforcement

Penalties under the Code have been rationalised but made more stringent:

General non-compliance: ₹2 lakh to ₹3 lakh

Repeated offences: higher fines and possible imprisonment

Compounding available for select offences

Mandatory reporting of serious accidents

8. Benefits for Employers

Streamlined compliance through single licensing

Reduced administrative burden

Clarity due to unified standards

Flexibility in working hours

Lower risk of litigation with uniform laws

Predictable inspection and enforcement systems

9. Benefits for Employees

Safer working conditions

Clearly defined working hour norms

Enhanced access to welfare facilities

Special support for migrant workers

Equal opportunities and protection for women

Improved grievance redressal mechanisms

10. Challenges and Practical Considerations

Despite its strengths, successful implementation may face challenges:

Full operationalisation requires state-level rules, still pending in several states

Informal sector compliance may remain weak

Employers may face increased costs for safety infrastructure

Technological readiness of small establishments may be limited

Key Takeaways

The OSH Code merges 13 major labour laws into a single modern framework.

It strengthens worker protection while simplifying employer compliance.

Migrant workers and women employees gain substantial new safeguards.

Employers benefit from digitised, transparent, and reduced compliance obligations.

Its effectiveness will depend heavily on state-level implementation and industry readiness.

Conclusion

The Occupational Safety, Health and Working Conditions Code, 2020 represents a transformative step in modernising India’s workplace ecosystem. By harmonising safety standards, digitising compliance, and prioritising worker welfare, the Code promises a safer, healthier, and more productive industrial landscape.

For businesses, it simplifies regulatory obligations and enhances operational predictability. For workers, it provides dignity, protection, and a secure working environment. Taken together, the OSH Code embodies a significant milestone in India’s journey towards building a globally competitive, socially responsible labour framework.