New Delhi : The Ministry of Labour and Employment on Wednesday pre-published draft Rules under all four Labour Codes, moving a step closer to the operationalisation of the sweeping labour law reforms that came into force in November 2025.
The draft Rules relate to the Code on Wages, the Code on Social Security, the Industrial Relations Code and the Code on Occupational Safety, Health and Working Conditions.
The ministry has invited comments, objections and suggestions from all stakeholders within a 30 to 45 day window from the date the draft notifications are made public. The final Rules will be notified after the consultation process is completed.
While the Labour Codes lay down the broad legal framework, the draft Rules spell out how these laws will be implemented on the ground, covering wages, working hours, social security, safety norms and dispute resolution.
CODE ON WAGES AND HOW PAY WILL BE CALCULATED
The draft Code on Wages (Central) Rules, 2025 provide detailed guidelines on how minimum wages and floor wages will be fixed, calculated and revised.
Minimum wages will be determined on a daily basis and then converted into hourly and monthly wages using a standard formula.
The calculation is based on the needs of a standard working-class family, including food intake, clothing, housing rent, fuel, electricity, education, medical expenses and other basic requirements.
The Central Government will fix a national floor wage, below which no State can set its minimum wage, though States will continue to have the power to prescribe higher wages depending on local conditions.
The draft Rules also clarify the definition of wages, including how allowances are to be treated when they form more than 50% of total remuneration.
Certain payments such as bonuses, incentives and reimbursements remain outside the wage definition, while safeguards are built in to prevent artificial lowering of basic pay.
WORKING HOURS, WEEKLY LIMIT AND NIGHT SHIFTS
The draft Rules reinforce the cap of 48 working hours in a week, with wages calculated on the basis of an eight-hour working day. They also lay out how wages must be paid for overtime work, rest days and substituted rest days.
Special provisions explain how wages will be calculated for night shifts, including cases where work extends beyond midnight. These provisions are significant for sectors such as manufacturing, services, logistics and IT, where round-the-clock operations are common.
Under the broader labour code framework, night shifts are defined as work carried out between evening and early morning hours, and women are permitted to work night shifts subject to consent and mandatory safety arrangements.
TIMELY PAYMENT AND LIMITS ON DEDUCTIONS
The draft Rules set clear timelines for payment of wages and place strict limits on deductions. Total deductions in any wage period cannot exceed 50% of an employee’s wages, with any excess to be recovered in later periods.
Employers must follow due process before imposing fines or deductions, including informing the employee and giving them an opportunity to be heard. All deductions and fines must be reported to the Inspector-cum-Facilitator within prescribed timelines.
COVERAGE OF INFORMAL AND YOUNG WORKERS
One of the key changes under the new framework is the removal of the distinction between scheduled and non-scheduled employment. The Code on Wages applies to all employees, including informal workers, contract workers and fixed-term employees.
The draft Rules make it clear that workers aged 16 years and above are covered under the wage protection framework, ensuring minimum wages and payment safeguards extend to younger workers in the informal economy as well.
In parallel, the draft Social Security Rules provide for Aadhaar-linked registration of unorganised workers aged 16 and above, enabling them to access social security benefits across States and occupations.
FIXED TERM EMPLOYMENT AND GRATUITY
The draft Rules support the Code’s provision that fixed-term employees are entitled to the same wages and benefits as permanent workers performing similar work.
Fixed-term workers will also be eligible for gratuity after completing one year of service, a significant shift from earlier norms.
This provision is expected to improve income security and reduce excessive reliance on informal contractual arrangements.
COMPLAINTS, APPEALS AND ENFORCEMENT
The draft Rules lay down detailed procedures for workers to file claims related to underpayment, delayed wages, unpaid overtime or denial of bonus.
They also specify timelines and formats for appeals against orders passed by authorities under the Code.
An Inspector-cum-Facilitator system has been outlined to focus on guidance and compliance rather than punitive inspections, with fixed timelines for authorities to act on complaints, approvals and recovery proceedings.
WOMEN, EQUAL PAY AND WAGE ENFORCEMENT
The draft Rules give operational backing to the principle of equal pay for equal work by integrating provisions earlier covered under the Equal Remuneration Act, which now stands repealed.
Wage registers and employee records must capture gender and pay details, making discrimination easier to identify and challenge.
Limits on arbitrary deductions, clearer complaint mechanisms and transparent wage calculations are expected to particularly benefit women workers, many of whom are concentrated in lower-paid and informal roles.
The inclusion of parents-in-law in the definition of family for women employees has implications for wage-linked benefits and social security access, reflecting a more gender-sensitive approach within the new framework.
The government has invited feedback on the draft Rules within 30 to 45 days, after which the final Rules are expected to be notified. Until then, existing rules under the repealed labour laws will continue to apply during the transition period.
Officials have indicated that the finalisation of the Rules is aimed at ensuring full operationalisation of the Labour Codes in the coming months, providing clarity to employers and workers ahead of the next financial year.
