By Satyabrat Borah
The four new labour codes that the Centre notified last week have created quite a stir. Television channels are calling them “historic” and “game-changing”. Some anchors even used the word “revolutionary”. On the other side, a few trade unions have already announced a countrywide protest, saying these codes will take away whatever little protection workers still enjoy. Both sides sound a bit dramatic, because the truth lies somewhere in the middle, and it is far less exciting than either camp wants us to believe.
First, let us understand what actually happened last week. The central government simply “notified” four codes that Parliament had already passed between 2019 and 2020. Notifying means the government has finally decided these laws will start applying from a certain date. In normal language, the codes were born five or six years ago; last week they were only taken out of the incubator and shown to the world. Calling this step revolutionary is like celebrating the printing of wedding cards as the marriage itself. The real wedding happened years back.
These four codes replace 29 old labour laws. Instead of juggling dozens of rule books, we now have four thick volumes: one on wages, one on social security, one on occupational safety and working conditions, and one on industrial relations. The idea behind merging them was simple: make life easier for companies, make rules clearer for workers, and bring millions of unorganised workers under some basic safety net. Whether the final product achieves all three aims is a fair question, but the basic intention was practical, not earth-shattering.
Take the most talked-about change: the rule about laying off workers. Under the old Industrial Disputes Act, any factory with 100 or more workers needed government permission before retrenching staff. Nineteen states, including Gujarat, Rajasthan, Maharashtra, and Haryana, had already raised this limit to 300 workers through their own amendments over the last two decades. The new Industrial Relations Code simply copies what these states were already doing and makes it the national rule. Companies with fewer than 300 workers can now close factories or lay off people without asking the government first (they still have to give notice and pay compensation). Is this a big new gift to employers? Not really. Big companies were already enjoying this freedom in half the country. The code only spreads an existing practice to the remaining states. Workers in West Bengal or Kerala will feel the difference more than workers in Gujarat or Madhya Pradesh, where nothing much changes on the ground.
Another change that worries unions is the easier rules for hiring contract labour and fixed-term employees. Again, this is not brand new. Factories and construction sites have been hiring contract workers in huge numbers for years. The difference is that the new codes openly accept this reality instead of pretending it does not exist. They lay down some basic rules: contract workers must get the same wage as regular workers for the same job, and fixed-term employees must get gratuity if they work long enough. These are small mercies, but they are written into law for the first time. Whether companies will follow them is another matter; enforcement has always been the weak link in Indian labour laws.
On the positive side, the codes try to bring gig workers, home-based workers, and platform workers (think delivery agents and cab drivers) into the social security net. The Social Security Code says the government will create schemes for them. Details are still missing, and the money will have to come from somewhere, but at least the law now recognises that India has moved beyond the old image of factory workers in blue overalls. A delivery boy sweating on a scooter in Delhi traffic is as much a worker as a lathe operator in Jamshedpur was seventy years ago. The law has finally caught up with that reality.
Trade unions are angry because they feel their bargaining power has been reduced. Strikes now need fourteen days’ notice, and in some essential services even longer. Standing on a street corner and shouting “tools down” without warning is no longer easy. The definition of “strike” has also become stricter; a mass casual leave can be treated as an illegal strike. Unions see this as an attempt to choke their main weapon. Companies see it as a way to avoid sudden shutdowns that hurt production and wages alike. Both have a point, but let us be honest: nationwide surprise strikes had already become rare. Most big strikes in recent years were announced well in advance and still failed to move the government. The new notice period formalises what was already happening.
What about wages and social security? The Code on Wages promises a national floor wage and easier recovery of unpaid wages. That sounds good on paper. The Occupational Safety, Health and Working Conditions Code brings in common rules for contract workers, migrant workers, and even journalists (yes, media houses are now covered). It limits working hours to a maximum of twelve per day, including overtime, and insists on annual health checks in risky jobs. Again, these are old demands dressed in a new language. The real test will be whether factories and construction sites actually start following them.
So why the loud celebrations and equally loud threats of protest? One reason is timing. The codes were notified just when assembly elections are round the corner in some states. Politicians love big announcements, even if the announcement is five years late. Another reason is that both sides have grown used to extreme language. For some business channels, any step that removes one form from a company’s table is a revolution. For some union leaders, any step that makes strikes slightly harder is the end of the working class.
The ordinary worker is probably confused. In a small workshop in Moradabad that makes brass handicrafts, the owner and the twenty artisans will keep doing what they were doing yesterday. In a large car factory in Tamil Nadu, managers will feel a little bolder about hiring and firing, but they were already pretty bold. A food-delivery worker in Bengaluru will still wait for the government to tell him whether he will get some provident fund or accident insurance; the code only says such schemes will come “in due course”.
India’s labour laws were indeed a mess. Some dated back to the 1920s and 1940s, written for a country that made textiles in Bombay and jute in Calcutta. Companies complained that they needed thirty different registers and faced fifty different inspectors. Workers complained that the laws existed only on paper; the inspector never came, and when he did, he came for tea and envelopes. The codes try to clean up this mess. They are not perfect. They leave too many details to future rules, which means governments can delay or twist things later. They trust employers more than the old laws did, which worries those who remember that trust is often misused. But they are not the monster some unions paint, nor the magic wand some television studios celebrate.
The real revolution India needs in labour is not four new codes. It is better schools so that workers’ children do not have to stand at the same factory gate their parents stood at. It is faster courts so that a worker who is unfairly dismissed does not wait twenty years for justice. It is honest inspectors and digital records so that employers cannot cheat on provident funds or minimum wages. The codes take one small step toward some of these goals. They also take one step backward in a few places. Mostly, they just catch up with what was already happening on the ground.
So the next time you hear the word “revolutionary” or see banners announcing a nationwide strike, take both with a pinch of salt. The codes are neither the beginning of a golden age for industry nor the death certificate of workers’ rights. They are a long-delayed tidy-up job. The house has been repainted, some old furniture thrown out, a few new pieces brought in. Whether it becomes a better home will depend less on the new paint and more on how the family living inside behaves from now on. For the moment, the sensible reaction is neither cheer nor anger. It is a quiet “finally”.
