Labour & Employment Law

Labour and employment law in India governs the relationship between employers, employees and workers. The principal statutory framework now includes 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, which came into force on 21 November 2025 and rationalised several earlier central labour laws. Other applicable enactments, including the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, may also be relevant depending on the nature of the matter.

The key labour laws applicable to employers in India are primarily the four Labour Codes — 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. These Codes consolidate and replace several earlier statutes. Additionally, the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 continues to apply. The specific obligations depend on the nature of the establishment, the workforce, the applicable provisions of the Codes and the rules or regulations made thereunder.

Under the Industrial Relations Code, 2020, “employee” is a broader term covering persons employed to perform skilled, semi-skilled or unskilled, manual, operational, supervisory, managerial, administrative, technical or clerical work. “Worker” refers to persons employed in an industry to perform specified categories of work, including manual, skilled, technical, operational, clerical or supervisory work, subject to the exclusions prescribed by the Code. The term “workman” used under the earlier Industrial Disputes Act, 1947 corresponds broadly to the current concept of “worker” under the Industrial Relations Code, 2020, subject to the statutory definitions. The distinction is relevant to the applicability of provisions relating to industrial disputes, retrenchment and other employment matters.

The procedure for termination of employment depends on the terms of the employment contract, the applicable law and the nature of the employment. Generally, termination may involve notice or payment in lieu of notice where applicable, while specific statutory requirements may apply to retrenchment, lay-off or closure in cases covered by the Industrial Relations Code, 2020. For workers covered by the Code, the applicable statutory conditions must be complied with. The validity of a termination may be challenged where applicable contractual or statutory requirements have not been followed.

Retrenchment means the termination by the employer of the service of a worker for any reason other than as a punishment inflicted by way of disciplinary action, subject to the exclusions specified in the Industrial Relations Code, 2020. These exclusions include voluntary retirement, retirement on reaching the age of superannuation, non-renewal of a contract in specified circumstances, completion of fixed-term employment and termination on the ground of continued ill-health. Retrenchment may also be subject to statutory requirements relating to notice, compensation and other prescribed procedures, depending on the circumstances and applicable provisions.

Industrial disputes may be addressed through mechanisms provided under the Industrial Relations Code, 2020, including conciliation, voluntary reference to arbitration and adjudication by Industrial Tribunals or National Industrial Tribunals, as applicable. Where the parties agree to arbitration, the dispute may be referred in accordance with the requirements of Section 42 of the Code. The specific procedure and forum depend on the nature of the dispute and the applicable statutory framework.

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act) provides a framework for the prevention, prohibition and redressal of sexual harassment at the workplace. It requires an Internal Committee to be constituted in establishments meeting the statutory requirements, while the Local Committee mechanism applies in specified cases, including establishments where an Internal Committee has not been constituted because there are fewer than ten workers or where the complaint is against the employer. The Act also provides for complaint, inquiry, redressal and related statutory obligations.

Provident fund and gratuity are social security benefits governed primarily by the Code on Social Security, 2020. The Code consolidates the earlier provisions relating to provident fund, gratuity, and other benefits. Eligibility, computation, and payment timelines depend on the applicable provisions of the Code and the rules made thereunder. Employers are required to comply with the statutory obligations regarding contributions, records, and timely payments. The specific entitlements may vary based on the nature of employment and the applicable scheme.

An employee may, where permitted by the applicable law, challenge a termination alleged to be wrongful, subject to the terms of employment and the applicable statutory framework. Depending on the nature of the employment and the dispute, remedies may include approaching the appropriate authority or tribunal, raising an industrial dispute or pursuing another available legal remedy. The availability of a particular remedy depends on the nature of the termination, the status of the employee or worker and the applicable law.

Legal representation is not uniformly mandatory or permitted in every labour matter; the position depends on the forum and applicable law. Under Section 94 of the Industrial Relations Code, 2020, a party to a dispute is not entitled to be represented by a legal practitioner in conciliation proceedings. Before an Industrial Tribunal or National Industrial Tribunal, legal representation may be permitted with the consent of the other parties and the leave of the Tribunal or National Industrial Tribunal. Other labour and employment proceedings may be governed by different statutory or procedural requirements.