When the Union government notified the rules for the Labour Codes in November 2025—six years after their parliamentary passage—it marked the most sweeping overhaul of labour legal architecture in post-independence India.
The four codes—Wages (2019), Industrial Relations (2020), Social Security (2020), and Occupational Safety and Working Conditions (2020)—consolidate 29 laws into a leaner, investor-friendly framework. But beneath the talk of “simplicity” and “compliance ease” lies a deep capitalist conspiracy: remove whatever little vestiges of hard-earned rights including trade union rights.
Passage of wantonly anti-labour codes passed in parliament without debate
The passage itself was opportunistic—not debated, not consulted, and certainly not consented to. The three bills, Industrial Relations (IR) code bill, 2020, the Occupational Safety, Health and Working conditions code bill, 2020, and the Code on Social Security bill, 2020 were hurriedly passed in the midst of rising covid 19 pandemic and at a time when the opposition had boycotted Parliament to oppose anti-peasant farm Bills. One more legislation that is ‘Code on wages’ was passed in 2019 which makes it four Labour Codes. It was then argued by the BJP government that the erstwhile central labour laws including some of the laws of the colonial period were consolidated and simplified into 4 Labour codes to enhance workers’ welfare and align the labour ecosystem.
The government also claimed that “with the evolving world of work, this landmark move lays the foundation for a future-ready workforce and stronger, resilient industries driving labour reforms for Aatmanirbhar Bharat (Self reliant India).” But in actuality the new labour codes far from being just a simplified versions actually include several new provisions utterly detrimental to, if not virtual ruination of, the cause of the working class.
Why the “Codes”?
The naming shift from Acts to Codes signals something structural: a move away from stable legislative rights toward flexible regulatory power concentrated in the Executive hands. Unlike Acts, which state specific standards, Codes outline general frameworks—leaving critical details to be defined later through “Rules.” These Rules can be rewritten by government notification, bypassing the parliament.
Moreover, this ‘Code architecture’ also nullifies federalism as enshrined in the Constitution. Because labour sits on the Concurrent List and hence states are authorized to draft their own rules. Facts would bear eloquent testimony to that.
The Industrial Relations Code Bill, 2020
The Industrial Relations code, 2020, has given absolute right for industries hiring up to 300 workers to unilaterally terminate services of any worker without any need of government’s approval. Earlier, following an amendment in 1982, industries hiring more than 100 workers were barred from unilaterally terminating any worker or declaring layoff. This offered some protection for the workers from the whimsical decisions of the owners. But the new enactment has done away with this safeguard and thrown the workers at the mercy of the management. This is applicable to more than 90% of the total work force who will be left without protection. According to Annual Survey of Industries 2014-15, if one looked at the organized sector, the number of industries appointing 100 or more workers was just 7.2%. The number of industries appointing 300 or more workers was only 1.2%. With the promulgation of new Industrial Relations Bill, the applicability of Industrial Disputes Act is drastically reduced.
Further the new Code has totally freed the managements from furnishing a standing order. The earlier existing Industrial Employment (Standing Orders) Act, 1946, made it mandatory for the employers of an industrial establishment where 100 or more workers are employed to clearly define the conditions of employment and rules of conduct for the workmen and make them known to the workmen employed. Now it has been abandoned. Standing order was enacted in 1946 in order to standardize the terms and conditions of service across various occupations so that the employer cannot arbitrarily change or determine the terms and conditions of service. It also provides for employment security against arbitrary dismissal by the employers by framing any kinds of allegations. It is to be noted that upto now the existing legal norm has been that no standing orders signed between the management and the workers’ representative could violate the model standing orders put out by the labour ministry. This acted as a great protection against unbridled exploitation by the owners. Now the standing order which mandates strict adherence to all these provisions are totally removed. So in this new situation what will be the fate of employees is anybody’s guess.
The Biggest Onslaught on the Right to Strike
The right to association and the right to strike which is an inalienable right of the working class has been restricted and diluted. More serious is the condition imposed on carrying out strikes. The time period of arbitration proceedings has been included in the conditions for workers before going on a strike as against only the time for conciliation at present. This means if the conciliation is on they cannot go on strike. After 7 days of conclusion of conciliation, they cannot go on strike.
Then the dispute will go to the industrial tribunal which takes still more time during which time they cannot go on strike. Only after 60 days of completion of all proceedings is legal strike allowed. Therefore by imposing such conditions the Code attempts to muzzle the voice of dissent of the workers and the unions.
Fixed term employment has been introduced under which the employers are given the absolute right to hire workers for a fixed term by denying them continued service even when the job is perennial in nature. Further under this Act the managements are not mandated to provide any social security benefits. This is nothing but legalization of hire and fire regime! Hitherto, the percentage of number of contract workers in organized sector was 35%. Moreover, appointment of contract workers for performing basic activities in the organized sector was banned. But now, any industry with 300 or more workers would be able to engage workers on contract for doing basic jobs and thereby keeping them out of the purview of Industrial Disputes Act. Moreover, in 2014-15, the average wage paid to a worker on contract in organized sector was Rs 8,500 was only 70% of what was paid to a regular worker. The new Code would empower the employers to appoint more and more workers on contract, thereby widening the gap between wage and labour.
Wage Code
By redefining what constitutes an industry the new Code simply excludes all institutions owned or managed workers working in establishments having 10 or less workers are considered as a separate category. This means the new Code provides two types of social security for two categories of workers, organized workers and unorganized workers. Further the new Code has recommended constitution of a National Social Security Board which in turn will recommend to by organisations substantially engaged in any “charitable, social or philanthropic service”, and such other services thereby denies protection and benefits to huge number of workers working in these establishments. Even “wage” has been redefined to deny wages to a worker as per the earlier provisions. It excludes a large proportion of the emoluments paid to a worker under the Industrial Disputes Act, 1947 like house rent allowance, the value of any house accommodation, travelling allowance, overtime allowance and remuneration among others.
The Wage Code’s promise— uniformity, transparency, reduced fragmentation—masks its core flaw: the floor wage has no statutory link to living costs. A wage floor without inflation-proofing or nutrition benchmarks becomes a policy tool to institutionalize poverty wages.
The Code on Occupational Safety, Health and Working Conditions
Certain existing provisions offering protection to the workers have been removed and new specifications are prescribed. The legal workday remains eight hours— but the introduction of “spread-over” enables twelve-hour shifts. The Code has also proposed employing women in all establishments for all types of works between 7 PM and 6 AM, brushing aside the widespread concern for women’s safety.
Further the protections for contract workers have been removed in establishments hiring more than 20 workers by increasing the threshold limit to 50 workers, which means two-thirds of the industrial establishments which hire more than 20 workers, but less than 50, will be left out of the purview of any legal benefits.
In a country where heatwaves kill workers on construction sites and industrial accidents are routine, longer workdays are not productivity reforms. They are a death sentence written into law.
Code on Social Security Bill, 2020
Under Social Security Code only organized workers are taken into consideration. Unorganized sector workers working in establishments having 10 or less workers are considered as a separate category. This means the new Code provides two types of social security for two categories of workers, organized workers and unorganized workers. Further the new Code has recommended constitution of a National Social Security Board which in turn will recommend to the central government suitable social security schemes for different sectors of organized workers. For GIG workers (workers engaged in non traditional works consisting of income-earning activities outside the traditional, long-term employer employee relationships), social security fund will be raised by both the aggregators and GIG workers. GIG workers will have to shell out up to 5% of their salary amount while the aggregators will contribute just 1-2 % of their turnover.
The replacement of labour inspectors with “Inspector-cum-Facilitators” represents another ideological shift: from enforcement to persuasion. Employers can “compound” wage violations— paying fines instead of facing prosecution. Wage theft becomes a business expense—not a crime.
Great Marx’s analysis Vindicated
Thus it can be seen that these legislations give a free hand for hiring and firing workers, snatch away existing labour protections and infringe upon their right to strike. On the other hand it rolls out red carpet to the profit-hungry corporate sharks under the garb of ‘ease of doing business’. Great Marx had shown that the labour contract under capitalism is never neutral: it is a formal legal fiction that hides an economic reality—workers must sell their labour to survive, while capital buys labour to dominate. The newly notified Labour Codes deepen this contradiction by:
- Weakening collective bargaining.
- Expanding employer prerogative.
- Increasing the reserve army of precarious workers.
- Legalizing flexibility as the organizing principle production.
Fascist Autocratic Onslaught Must be Thwarted
As we know, more crisis ridden is imperialism-capitalism because of its inherent law of operation, more fascistic becomes its rule with a view to saving the crisis-ridden, chaos-discredited capitalist order from collapse in the face of mounting dissatisfaction of the people against the existing system, as well as to stave off revolution by an anticipatory move. This analysis was provided by Comrade Shibdas Ghosh, founder General Secretary, SUCI(C) and an outstanding Marxist thinker of the era way back in 1962. And the brunt of the capitalist crisis is squarely passed on to the toiling masses the oppressed working class included. And if the labour movement is not conducted along the right track under correct leadership, the revolutionary intensity of oppression mounts.
These labour Code Bills, it must be understood, are a part of anti-people capitalist globalization and liberalization policies which have cast dark shadows on all the category of the workers, whether organized, or unorganized, whether contract workers or construction workers or GIG workers.
So, at the first opportune moment, particularly if the labour movement is not in its desired ferment and the social democrats, the compromising force between labour and capital, whom great Lenin called labour-aristocrats, have their sway on the working class movement—the capitalist rulers seizing that opportunity, seek to nullify in one stroke the hard won rights and protections of the workers won over decades of struggle. But the capitalist rulers and their servitors like the BJP, Congress etc., forget the inherent irreconcilable contradiction: when workers are stripped of rights, they gain something more dangerous— clarity which spurs them on to launch higher forms of struggle to protect their rights.
