India’s New Labour Codes (Nov 2025): a simple guide for founders and HR

On 21 November 2025, the new Labour Codes came into force. They replace many older laws and create one clear set of rules for on-time pay, fair hours, safer shifts, and basic benefits. This blog explains what changed, and what it means in daily work.
Core changes
- One appointment letter for everyone. Put role, pay, hours, overtime, leave, and dispute route in writing.
- Hours and overtime. Plan 8 hours a day, 48 hours a week. If someone works extra, overtime is 2× pay.
- Women on night shifts. Allowed with consent and company-arranged safety (transport/security).
- Health checks: Annual medicals for workers aged 40+.
- Social security (ESIC/EPF). Earlier coverage often varied by location/establishment; now it’s broader and more uniform, with better portability and clearer inclusion of fixed-term roles
- Gratuity after 1 year for fixed-term employees. (Regular, permanent roles keep the 5-year rule.)
Additionally
- Earned leave: eligible after 180 days of work in a year (earlier 240).
- “50% rule” for wages: Basic + DA ≈ half of total pay for statutory calculations.
- Full & final settlement: pay within 2 working days of exit.
- Monthly salary: credit by the 7th of the following month.
Note: The Codes are central; some details still depend on state notifications. Treat this as your baseline and check state updates.
What this means day to day
- You’ll issue (or refresh) standard appointment letters for every employee.
- Your HRMS/attendance must respect 48 hours/week and calculate OT at 2× automatically.
- If you run night shifts, you’ll keep opt-in consent, transport, and security on record.
- Payroll must show clear pay tables (in-hand, variable, ESOPs if any) and hit timelines.
- You’ll map ESIC/EPF eligibility and keep digital records tidy.
- Managers schedule 40+ health checks on a simple annual calendar.
Your Go-To-Checklists:
1) Hours, rosters, overtime — quick rules
- Plan weekly schedules to ≤48 hours
- Record actual hours; auto-flag breaches
- Pay OT at 2×; show it on payslips
- Keep weekly manager review of OT logs
2) Women’s night shift:
- Written opt-in consent
- Safe transport to/from workplace
- Security and on-site facilities
- Emergency contacts and escalation
- Review consent every quarter
3) ESIC/EPF mapping — 5 steps
- Pull employee list with wages/tenure.
- Mark ESIC/EPF eligibility.
- Enrol missing cases; verify UAN numbers.
- Reconcile contributions; fix gaps.
- Store e-records and acknowledgements.
4) Full & final (F&F) — “within 2 working days”
- Exit form + asset return → calculate dues same/next day
- Pay F&F (salary, leave encashment, OT, bonuses due)
- Share breakup and payslip; update records
- Issue relieving + service letters promptly
FAQs:
Will take-home change?
- It can, because Basic+DA ≈ 50% raises PF/gratuity bases. Many companies rebalance CTC to keep net pay steady.
Can we run a 4-day week?
- You can—if the weekly total stays within 48 hours and OT at 2× is paid where due.
Is this only for factories?
- No. The rules cover IT/ITES too: letters, hours/OT, safety, social security, pay timelines.
Do states still matter?
- Yes. The Codes are central, but states publish operational details. Track your states.
One-screen summary:
- Letters: one clear letter for everyone
- Time: 8/day, 48/week; OT = 2×
- Women nights: consent + transport + security
- Benefits: ESIC/EPF wider & more uniform
- Health: annual checks for 40+
- Leave: earned leave after 180 days
- Pay: Basic+DA ≈ 50% of total pay (statutory)
- F&F: within 2 working days; salary by 7th
Closing thought
This is not about extra paperwork. It is about clear letters, fair hours, predictable pay, safer shifts, and basic health checks. Do the simple things well and everything else gets easier. Fewer disputes, calmer audits, and more trust.