👷 Labour & Employment

Labour Laws — 4 Codes

India's 29 central labour laws have been consolidated into 4 Labour Codes (2019-2020) covering wages, industrial relations, social security, and occupational safety.

4Labour Codes
29Laws Consolidated
MoLEMinistry of Labour
PF+ESIKey Contributions
The Four Codes

Labour Codes at a Glance

Code 1 — 2019

Code on Wages

Consolidates Minimum Wages Act, Payment of Wages Act, Payment of Bonus Act, and Equal Remuneration Act. Establishes a universal minimum wage floor across India.

Code 2 — 2020

Industrial Relations Code

Consolidates Trade Unions Act, Industrial Employment (Standing Orders) Act, and Industrial Disputes Act. Layoff provisions and strike notice rules revised for larger establishments.

Code 3 — 2020

Social Security Code

Consolidates EPF, ESIC, Gratuity, Maternity Benefit, CBLW and more. Extends coverage to gig workers and platform workers. Brings new definitions of wages.

Code 4 — 2020

Occupational Safety Code

Consolidates Factories Act, Mines Act, Building & Construction Workers Act and 11 other laws. Single licence for inter-state migrant workers.

Key Provisions (Current Law)

Active Compliance Requirements

1
EPF — Employees' Provident Fund (EPF&MP Act 1952)
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  • Applicability: Establishments with 20+ employees
  • Employee Contribution: 12% of basic + DA
  • Employer Contribution: 12% — split: 8.33% to EPS (Employee Pension Scheme) + 3.67% to EPF
  • Wage Ceiling: Mandatory on wages up to ₹15,000/month; voluntary beyond
  • Returns: ECR (Electronic Challan cum Return) monthly by 15th; Annual return by 25 April
  • EDLI: Employees' Deposit Linked Insurance — employer contributes 0.5% (max ₹75/month)
2
ESIC — Employees' State Insurance (ESI Act 1948)
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  • Applicability: Factories/establishments with 10+ employees; wages ≤ ₹21,000/month
  • Employee Contribution: 0.75% of wages
  • Employer Contribution: 3.25% of wages
  • Benefits: Medical, sickness, maternity (26 weeks), disablement, dependent benefits
  • Contribution period: Apr-Sep (pay by Oct 15), Oct-Mar (pay by Apr 15)
  • Returns: Half-yearly returns within 42 days of contribution period end
3
Gratuity (Payment of Gratuity Act 1972)
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  • Applicability: Establishments with 10+ employees; payable after 5 years continuous service
  • Formula: Last drawn basic × 15/26 × number of years of service
  • Ceiling: ₹20 lakh maximum (revised in 2018)
  • Tax exemption: Least of actual gratuity, ₹20L, or 15 days' salary × years is exempt
  • Termination: Payable even on resignation (after 5 years), death/disability (no 5-year requirement)
4
Minimum Wages & Bonus
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  • Minimum Wages: Scheduled employments have statutory minimum wages set by Central/State governments; varies by state and skill level
  • National Floor Level Minimum Wage: ₹176/day (recommended; states may set higher)
  • Payment of Bonus Act: Applicable to establishments with 20+ employees; employees drawing salary up to ₹21,000/month eligible
  • Bonus rate: Minimum 8.33% of annual salary; maximum 20%. Calculated on salary ceiling of ₹7,000 or minimum wage, whichever is higher
5
Maternity Benefit Act 1961
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  • Maternity leave: 26 weeks for first two children; 12 weeks for third child onwards
  • Applicability: Establishments with 10+ employees
  • Eligibility: Women who have worked 80+ days in 12 months preceding delivery
  • Crèche facility: Mandatory for establishments with 50+ employees
  • Work from home: Employer may allow WFH after maternity leave, if nature of work permits
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