Labourers are rightfully considered to be the backbone of the economy of a country. Their skills, experience, knowledge, etc is what gives a cumulative upper hand to a country that plays a vital role in the overall development of a country. Labour rights are hard earned rights that are dynamic and changing in nature in alignment with growth/ development of a country. It is therefore important that the state as well as the policy makers frequently review the needs of the labourers from time to time and amend or pass legislations in order to enhance labour development.
Recently, on 21st November 2025 India enacted 4 new labour codes namely;
Code on Wages, 2019
Code on Social Security, 2020
Industrial Relations Code, 2020
Code on Occupational Safety, Health and Working Conditions, 2020.
These new labour codes aim to subsume 29 existing labour legislations and consolidate, streamline various provisions to eliminate discrepancies to a greater extent. While delivering a speech in the parliament Prime Minister Dr. Narendra Modi stated that “the much-awaited labour reforms have been passed. These labour reforms will accelerate the pace of economic growth. These labour reforms will ensure ‘Ease of Doing Business’ and are futuristic legislations.”[1] Statistically, more than 90% of the labourers in India belong to the informal sector such as gig workers, platform workers, etc.[2] This regards a paradigm shift in the working of the labour laws in India.
The impetus for consolidation was not merely administrative convenience but arose from documented regulatory dysfunction spanning several decades. The Second National Commission on Labour, which submitted its report in June 2002, observed that India was functioning under more than 40 central labour laws and nearly 100 state labour laws, many of which overlapped or directly contradicted one another, placing workers and industries in a cycle of confusion where rights were difficult to enforce and compliance remained burdensome.[3] Prior to the implementation of the four codes, firms operating in India were estimated to face over 69,000 compliances annually under 1,536 legal provisions, a burden that disproportionately deterred formalisation among micro, small, and medium enterprises and reinforced a culture of regulatory avoidance.[4]
[1] Ministry of Information and Broadcasting, New Labour Code for New India: Biggest Labour Reforms in Independent India (Government of India 2023) <<https://labour.gov.in/sites/default/files/labour_code_eng.pdf>> accessed 3 April 2026.
[2] Govindan Raveendran and Joann Vanek, ‘Informal Workers in India: A Statistical Profile’ (WIEGO Statistical Brief No 24, August 2020) <<https://www.wiego.org/wp-content/uploads/2020/10/WIEGO_Statistical_Brief_N24_India.pdf>> accessed 3 April 2026.
[3] ‘Labour Gains: The New Labour Codes Align India with the Best International Practices’ (MyGov, 2025) <<https://blog.mygov.in/editorial/labour-gains-the-new-labour-codes-align-india-with-the-best-international-practices/>> accessed 3 April 2026.
[4] ‘Implementing Labour Reforms in India’ (Drishti IAS, 24 November 2025) <<https://www.drishtiias.com/daily-updates/daily-news-editorials/implementing-labour-reforms-in-india>> accessed 3 April 2026.
Publication Date: 2026-06-19