The 4 codes
India is stepping into a new world of work one that is clearer, fairer, and far more employee-centric. For the IT industry, where long hours, high-pressure projects, and unpredictable schedules are common, these reforms bring a sense of balance that has been needed for years. For HR teams, this isn’t just about following new rules. It’s about reshaping how employees experience work. The four new codes are:
- Code on Wages, 2019
- Industrial Relations Code, 2020
- Code on Security, 2020
- Occupations, Safety, Health & Working Conditions (OSH) Code, 2020
Salary by the 7th: Reliability Employees Can Count On
One of the biggest reliefs for employees is the new rule mandating that salaries must be credited by the 7th of every month. Timely salary payments have always been expected, but now it’s a legal commitment. This means:
- Employees can plan their finances with confidence
- No more anxiety around delayed payments
- Stronger trust between employers and employees
In the IT world where project cycles sometimes caused payment inconsistencies this brings much-needed stability.
Basic Salary = 50% of CTC: Goodbye Confusing Breakups
Salary structures in India have always been complicated. With basic pay often kept low, many employees ended up with reduced PF contributions and unpredictable benefits. The new Labour Codes solve this by making basic wages at least 50% of the total CTC. Gratuity which was earlier five years now needs just one year. What changes?
- PF and gratuity become more meaningful
- Compensation becomes easier to understand
- Long-term financial security gets a major boost
Overtime = Double Pay: Respecting Personal Time
The IT sector has always had crunch moments product launches, go-lives, client escalations. Overtime often felt mandatory and rarely compensated properly. The new rule makes things clear:
- Overtime must be voluntary
- Written consent is required
- And most importantly, it must be paid at twice the normal rate
This will push companies to plan better and reduce burnout, while ensuring employees are paid fairly for extra hours.
48-Hour Weekly Cap: Flexible, But Fair
The codes allow employees to work longer days (up to 12 hours), but total working hours in a week cannot exceed 48 hours. This opens the possibility of:
- 4-day workweeks
- Flexible work arrangements
For IT professionals constantly juggling deadlines, personal life, and upskilling, this creates a healthier and more balanced routine.
Appointment Letters for Everyone: No More Informal Employment
Whether it’s a permanent hire, a trainee, or a contractual employee—everyone must now receive a formal appointment letter. It must clearly spell out:
- Job role
- Wages
- Benefits
- Working hours
- Leave
- PF/ESIC details
This ensures transparency from Day 1 and reduces misunderstandings later.
PF, ESIC & Gratuity for Contract Staff: A Step Toward Equality
The IT industry relies heavily on contract workers. But benefits for them have always been limited. Now, contract and gig workers will receive:
- PF
- ESIC
- Gratuity (after just one year)
This is a massive step toward fairness and financial security for thousands of workers who often felt left out.
Women Can Work Night Shifts with Strong Safety Measures
Women are now legally allowed to work night shifts, provided companies ensure:
- Safe transportation
- Proper security
- Written consent
- Adequate supervision and lighting
This allows more women to take up global-support or shift-based roles without compromising safety.
Annual Health Check-Ups for Employees Over 40
Given the sedentary lifestyle in IT—hours in front of screens, limited movement, and high stress—the new provision for mandatory annual health check-ups (for employees aged 40+) is timely. It encourages:
- Early detection of health risks
- Preventive care
- A workplace culture that genuinely prioritizes well-being
Simplified Compliance: Less Paperwork, More People-Focus
The new codes consolidate registrations, licenses, and annual returns into simpler forms. This means HR teams can finally spend less time on documentation and more on:
- Employee engagement
- Culture building
- Skill development
- Retention strategies
Conclusion: A People-First Workplace Is Finally Taking Shape
India’s 2025 Labour Code Reforms are not just legal updates—they represent a shift in mindset. For the IT sector, these changes bring responsibility, fairness, and a clear focus on employee well-being. As HR professionals, this is our opportunity to lead the transition, educate teams, and create workplaces where people feel secure, valued, and respected. The future of work is structured, safe, and human-centric—and it has already begun. Let’s make the most of it.
