New Delhi, November 22 - The Indian government has implemented four landmark labour codes that officials say will significantly strengthen the country's export ecosystem while ensuring better protections for workers. The long-pending reforms, finally enacted on Friday, provide the flexibility and predictability needed to compete in volatile global markets.
Boosting Export Competitiveness
According to a commerce ministry official, the labour codes introduce crucial changes that will help Indian exporters meet international compliance requirements while maintaining competitive advantages. The reforms provide flexibility, simplification, and predictability - three essential elements for success in today's challenging global trade environment.
For the approximately 2 lakh exporting units across India that employ over 50 million people, these changes come at a critical time. The country recently achieved record goods and services exports of USD 825 billion in 2024-25, and the new labour framework aims to sustain this growth momentum.
Key Benefits for Workers and Employers
The comprehensive labour reforms introduce worker-friendly measures including timely minimum wage payments for all workers and universal social security coverage that now extends to gig and platform workers. Simultaneously, the codes allow longer work hours, broader fixed-term employment, and more flexible retrenchment rules that benefit employers.
A uniform definition of "wages" across all labour codes eliminates confusion caused by multiple, inconsistent definitions in previous laws. This standardization simplifies payroll administration and compliance for export-oriented industries operating across multiple states, ensuring consistency in wage calculations for social security contributions, bonuses, and gratuity payments.
Gender Equality and Operational Flexibility
The codes explicitly prohibit gender-based discrimination in recruitment and wages, ensuring equal remuneration for equal work. This alignment with international labour standards meets expectations of global retail and sourcing partners who frequently audit Indian export facilities.
Another significant change permits women to work night shifts with their consent and adequate safety measures. This provision particularly benefits export industries running 24-hour production cycles to meet international orders in sectors like apparel, electronics, and IT-enabled services.
The threshold for government approval for lay-offs, retrenchment, or closure has been raised from 100 to 300 workers, giving industries greater operational flexibility to adapt to changing export demands and global market conditions. This allows exporters to confidently expand employment during peak seasons without fearing excessive rigidity during downturns.
Plantation workers' rights have been consolidated, expanded, and made portable under the new provisions. The implementation of transparent digital documentation will enhance credibility during audits by overseas clients and certification agencies, further strengthening India's position in global markets.
