India Labour Codes (2026)
The India Labour Codes are four consolidated federal laws - the Code on Wages (2019), the Industrial Relations Code (2020), the Code on Social Security (2020), and the Occupational Safety, Health and Working Conditions Code (2020) - that replace 29 previously separate Central Labour Acts, effective 21 November 2025 with the central government targeting April 1, 2026 for full operational parity across states.
The consolidation streamlined 1,228 legal sections into 480, replaced 31 separate returns with a single electronic filing, and cut employer-maintained registers from 84 to 8 (Ministry of Labour and Employment). The single change with the biggest payroll impact is the standardized wage definition: if allowances and exclusions (HRA, conveyance, overtime, etc.) exceed 50% of total remuneration, the excess must be added back into the base used to calculate Provident Fund and Gratuity - commonly called the '50% Wage Rule' - which raises statutory costs by an estimated 5-15% per employee for companies that previously structured salaries with a low basic-pay component.
For the full cost and compliance breakdown, see India Payroll: The Complete Guide.
References
- Compliance Handbook for Employers Under the Four Labour Codes (Central Government Sphere) — Ministry of Labour and Employment, Government of India
- India's New Labour Law Reforms (2026): A Guide for Employers — TopSource Worldwide