India's electronics manufacturing sector is poised for a significant transformation with the implementation of four long-pending labour codes. Industry leaders believe these reforms will dramatically increase women's participation in the workforce while strengthening employee trust and reducing attrition rates across the sector.
Four Key Benefits for Electronics Sector
The India Electronics & Semiconductor Association (IESA) has identified four primary areas where the ESDM (Electronics System Design and Manufacturing) sector will benefit from the new labour codes. These include encouraging more women to join the industry, enhanced skill retention, improved health and safety standards, and better social protections for workers.
Allowing women to work in all roles—including night shifts and specialized operations—with mandatory safety measures will help expand the talent pipeline in critical areas such as semiconductor assembly, verification labs, and 24×7 manufacturing operations. The industry body also highlighted that recognition of gig and platform workers and portability of benefits represents a forward-looking addition suited to India's digital and innovation-driven economy.
Operational Improvements and Workforce Stability
The labour codes introduce provisions for fixed-term employment, faster dispute resolution, single licensing, and simplified compliance that directly support the scaling of high-tech manufacturing clusters. According to IESA, parity of benefits for fixed-term employees and expanded social security protections ensure a balanced, worker-centric ecosystem.
The India Cellular and Electronics Association (ICEA) emphasized that the codes will boost business productivity while ensuring better working conditions. The reforms cap maximum working hours at 8 hours per day and 48 hours per week, with overtime payable at twice the normal rate for hours beyond regular working time. This structure promises better work-life balance for employees while increasing household cash flow for workers and ensuring greater business productivity.
Addressing Challenges and Future Outlook
Despite the optimistic outlook, IESA flagged some potential near-term challenges, including higher wage and compliance costs as benefits expand, an adjustment period for MSMEs to adopt new norms, and the need for stronger HR processes and documentation practices.
Pankaj Mohindroo, Chairman of ICEA, stated that for the IT and electronics sectors, these reforms bring about stronger social security, operational clarity, and a more stable workforce environment—factors that will enhance productivity and enable long-term competitiveness. ICEA believes these changes will facilitate sustainable job creation and support India's aspiration of becoming a self-reliant manufacturing powerhouse.
The timing is particularly crucial given that women constitute a crucial demographic for electronics manufacturers. A 2024 report by Quess Corp shows women accounted for 78 per cent of the industry's workforce, typically hired on assembly lines for smartphone production, as operators, quality assurance professionals, and in testing roles.
IESA concluded that the Labour Codes will significantly strengthen blue-collar jobs in electronics manufacturing by ensuring better wages, safer workplaces and expanded social security. A more formal and future-ready workforce will reduce attrition and boost productivity across India's factories, marking an important step toward building globally competitive ESDM and semiconductor ecosystems.
