New Labour Codes 2024: Key Changes Impacting Employers and Employees

India’s labour landscape is set for a major overhaul with the implementation of four consolidated labour codes, replacing 29 outdated laws. The reforms aim to balance worker protection with business flexibility. Here’s a detailed look at the transformative changes:

1. Early Gratuity for Fixed-Term Contract Workers

• Fixed-term employees can now claim gratuity before completing 5 years of service, benefiting short-term workers in IT, e-commerce, and manufacturing.

2. Universal Minimum Wage & National Floor Wage

• A nationwide minimum wage will standardize pay across states.
• States must align their wages with the central floor wage to reduce exploitation in unorganized sectors.

3. Work From Home (WFH) Formalized in Employment Contracts

• Employers must outline WFH terms, including internet reimbursements, work hours, and data privacy—a boon for IT and gig workers.

4. Higher Overtime Pay (2x Salary) with Stricter Caps

• Overtime wages double from 1.5x to 2x the standard rate.
• New limit: 8 hours/week (125 hours/quarter) to prevent burnout.

5. 4-Day Work Week (12-Hour Shifts)

• Companies may adopt a 4-day week, but employees must complete 48 hours weekly—raising concerns about fatigue.

6. Social Security for Gig Workers

• Platform workers (Uber, Swiggy, etc.) gain access to pension, health insurance, and disability benefits.
• Aggregators to contribute 1-2% of turnover to a Social Security Fund.

7. Easier Hiring/Firing for Employers

• Government approval for layoffs now applies to firms with 300+ employees (up from 100).
• Mandatory 15-day notice and severance pay for terminated workers.

8. Women Allowed in Night Shifts with Safety Protections

• Sectors like BPOs and healthcare must provide secure transport, childcare, and security for women working nights (7 PM–6 AM).

9. Faster Labour Dispute Resolution

• Cases to be resolved within 1 year via a streamlined two-member tribunal.

Implementation Timeline & State Variations

While Parliament has approved the codes, states like UP and Karnataka are ahead in rolling out rules. Others may delay adoption until 2025.

Key Takeaways

• Employees gain: Early gratuity, WFH rights, higher overtime pay, and gig worker protections.
• Employers gain: Flexible hiring/firing, 4-day work weeks, and consolidated compliance.

For real-time updates, follow Livemint’s labour code coverage.

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