The New Labour Code will not come into effect from today, July 1

Even in the past, there have been several dates fixed for implementation of these labour codes but every time it has been deferred further


It’s not known where this news cropped up from, but the fact is that there is no confirmation that the new labour code will be implemented from today, which is July 1, 2022.

There were assumptions, speculations and several analyses that with the implementation of labour code, the in-hand salary for the employee will change as the employee’s basic salary will now be at least 50 per cent of their gross monthly salary.

Besides, there were also media reports that claimed that companies will go for 4-day week and three weekly offs, and also that the work hours will be 12 hours a day.

Reverting on a query by Moneycontrol, the Union Ministry of Labour & Employment, clarified that the new labour code will not be implemented on July 1, 2022.

“It’s not getting rolled out on 1 July. The discussions and deliberations on final contours of the four codes are still on. Do not go by speculations,” a senior government official told Moneycontrol.

The four labour codes — Code on Wages, Industrial Relations Code, Social Security Code and the Occupational Safety, Health and Working Conditions Code — are set to replace the 29 labour laws that exist in India.

Even in the past, there have been several dates fixed for implementation of these labour codes but every time it has been deferred further.

According to a survey conducted in the last quarter of 2021, to assess India Inc.’s readiness for the implementation of these four codes by Karnataka Employers’ Association, 2 out of 3 Indian companies wanted a phased roll-out of the new labour codes.

Pratik Kumar, CEO, Wipro Infrastructure Engineering and executive director – Wipro Enterprises had said, “The changes that the four codes are expected to bring about have been long overdue and it has been an industry ‘ask’. The codes aim to enhance the social security of the workforce and guide implementation of labour law compliance. They will cut down on significant systemic complexities and help accelerate economic growth. On their part, organisations need to revisit their HR policies and relook at their employee compensation structure. They have to conduct their own impact analysis and critically look at their own compliance practices.”

HRKatha had done a detailed survey on implication of labour codes on organisations. One can download the report here.

The codes are expected to have a huge financial impact on the employers. With so many changes, it will take time for respective stakeholders to understand and abide by the new codes.

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