The Centre has announced the rollout of significant labor reforms, encompassing minimum wage, social security, and workplace regulations, effective November 21, 2025. These reforms, which include the implementation of four labor codes enacted five years prior, aim to replace 29 existing laws and modernize the labor ecosystem.

These codes, namely the Code on Wages (2019), the Industrial Relations Code (2020), the Code on Social Security (2020), and the Occupational Safety, Health and Working Conditions Code (2020), represent a major overhaul of workforce regulations, intended to boost job creation, attract investment, and simplify the process for firms to hire and fire employees. Prime Minister Modi has hailed these as the "most comprehensive and progressive labor-oriented reforms since Independence".

Key Changes and Benefits:

• Minimum Wage: The reforms establish a national floor wage, with states having the option to set higher minimums. As of early 2025, many states and localities have already scheduled minimum wage increases, with some exceeding $15 or even $17 per hour. For instance, on January 1, 2025, minimum wages increased in 21 states and 48 cities and counties. Furthermore, federal contractors will see their minimum wage rise to $17.75 per hour on January 1, 2025.
• Social Security: The new codes aim to extend social security coverage to all workers, including those in the gig and platform economy. Fixed-term employees will now be eligible for gratuity after one year of service, and all workers will receive benefits such as PF, ESIC, and insurance. The Social Security Fairness Act, signed into law earlier in the year, ends the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), increasing Social Security benefits for those who receive a pension based on work not covered by Social Security.
• Employability and Safety: The reforms seek to increase the employability of women and ensure workplace safety. Women are now permitted to work at night and in all types of jobs, provided they consent and safety measures are in place. The codes also mandate equal pay for equal work and representation of women in grievance committees. Additionally, several sectors will now have mandatory annual health check-ups for employees over 40.
• Ease of Doing Business: By consolidating 29 labor laws into four codes, the reforms aim to simplify compliance for businesses. The codes introduce single registration, licensing, and return processes, replacing multiple requirements under previous laws. These changes are intended to provide more flexibility and certainty to businesses, particularly in light of global economic headwinds.

Impact and Concerns:

The implementation of these codes is expected to have a wide-ranging impact on both workers and employers. For workers, the reforms promise enhanced social security, timely wage payments, and improved working conditions. For businesses, the changes offer greater flexibility and reduced compliance burdens, potentially attracting more investment and boosting job creation.

However, some trade unions have expressed concerns about the reforms, labeling them as "anti-worker" and "pro-employer". These unions are planning nationwide protests to demand the withdrawal of the new labor laws. Their apprehension stems from the perceived unilateral implementation of the codes and potential negative impacts on worker rights.

Despite these concerns, the government is moving forward with the implementation, emphasizing that the reforms are the result of extensive consultations with various stakeholders. The rules for the four codes are expected to be notified within 45 days, paving the way for full enforcement of the provisions. As these reforms take effect, it remains to be seen how they will ultimately reshape India's labor market and impact the lives of millions of workers and businesses across the country.