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Context
The Year End Review 2025 shows the Ministry of Labour and Employment focused on job creation, social security, labour law reform, and skilling for inclusive, future-ready growth.
Ministry of Labour and Employment Achievements/initiatives in 2025
Status of Four Labour Codes
The Government implemented Labour Codes, streamlining 29 central labor statutes into four codes to modernize the regulatory framework and enhance worker welfare.
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Labour Code
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Key Provisions
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Code on Wages, 2019
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- Universal Minimum Wage: Guarantees minimum wages and timely payment to all workers in both organized and unorganized sectors.
- Floor Wage: The Central Government will set a floor wage, and state governments cannot fix minimum wages below this level.
- Reduced Disparities: Aims to reduce the number of minimum wage rates across states, simplifying the wage structure.
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Industrial Relations Code, 2020
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- Fixed Term Employment (FTE): Legalizes FTE, providing workers with the same benefits and conditions as permanent employees, which can reduce informal contractualization.
- Dispute Resolution: Introduces a two-member Industrial Tribunal (one judicial, one administrative) for faster dispute resolution.
- Worker Re-skilling Fund: Employers must contribute 15 days of the last drawn wages for every retrenched worker to this fund for their retraining.
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Code on Social Security, 2020
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- Universal Social Security: Aims to extend social security benefits (like insurance, pension) to all workers, including unorganized sector and gig/platform workers.
- Gig Worker Coverage: For the first time, defines 'gig workers' and 'platform workers' to bring them under a social security framework through a dedicated fund.
- Expanded ESIC/EPFO Coverage: Provisions to expand the coverage of ESIC and EPFO to more establishments, including those with fewer than 10/20 employees and for the self-employed.
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Occupational Safety, Health and Working Conditions (OSH) Code, 2020
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- Broader Application: Applies to establishments with 10 or more workers, ensuring OSH standards for a larger workforce.
- Rights for Inter-State Migrant Workers: Defines inter-state migrant workers and provides for benefits like a lump-sum travel allowance and portability of public distribution system (PDS) benefits.
- Women Empowerment: Allows women to work in all establishments and during night shifts (with consent and safety provisions).
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Social Security Coverage
Coverage Statistics: The International Labour Organization's 'World Social Protection Report' states that only 29% of India's population receives at least one social protection benefit, underscoring the need for expansion.
Gig and Platform Workers: The Code on Social Security, 2020, establishes a Social Security Fund for gig and platform workers, who also receive benefits through schemes like Ayushman Bharat-PMJAY.
Employees’ Provident Fund Organisation (EPFO) Reforms
EPFO has implemented several digital and process reforms to improve "Ease of Living" for its members.
- Interest Rate: The Central Board of Trustees (CBT) has recommended an interest rate of 8.25% for the financial year 2023-24, the highest in three years.
- Auto-Settlement of Claims: The limit for auto-mode settlement for advances related to illness, education, marriage, and housing has been increased from ₹50,000 to ₹1,00,000.
- Digital Transformation:
- Face Authentication Technology (FAT): Introduced in the UMANG App for UAN activation and accessing services, simplifying processes for members.
- Centralized Pension System: Enables crediting pensions to bank accounts of pensioners across India from a single central database.
- Dispute Resolution: 'Vishwas Scheme' to provide an alternative dispute resolution mechanism for settling penal damages by offering a graded penalty structure, reducing litigation.
Employees' State Insurance Corporation (ESIC) Expansion
ESIC is expanding its services both geographically and in terms of benefits provided to insured persons and their families.
- National Footprint: The ESI Scheme is now fully implemented in 642 districts and partially in 151 districts across India, with a target to cover the entire country.
- Atal Beemit Vyakti Kalyan Yojana (ABVKY): This unemployment allowance scheme provides relief in the form of cash compensation for up to 90 days to insured persons who become unemployed.
- Healthcare Infrastructure: ESIC upgrading its medical infrastructure by setting up new hospitals and medical colleges to provide better healthcare services to its beneficiaries.
Key Digital Platforms for Employment
e-Shram Portal: Creating a national database of unorganized workers and integrating them into the formal social security system.
- Registrations: The portal has registered over 30.68 crore unorganized workers as of March 2025.
- Objective: To provide workers with an e-Shram card containing a 12-digit Universal Account Number (UAN), making them eligible for various social security schemes.
- Integration: The portal is integrated with the National Career Service (NCS), Skill India, and PM-SYM portals to connect workers with employment, skilling, and pension benefits.
National Career Service (NCS) Portal: NCS serves as a digital one-stop platform for job seekers, employers, and training providers.
- Key Statistics: The portal has mobilized over 7.03 crore vacancies since its inception and currently has over 3.7 crore active jobseekers registered.
- Strategic Partnerships: MoUs have been signed with private players like Microsoft, Quikr, and Monster India (now FoundIt) to integrate their job vacancies and skilling resources onto the NCS platform.
- Digital Public Infrastructure (DPI): NCS is transitioning into a DPI for employment, creating an open and interoperable digital backbone to connect various government and private sector employment platforms.
Source: PIB
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PRACTICE QUESTION
Q. "The implementation of the four Labour Codes marks a shift from 'regulator' to 'facilitator' in India’s industrial relations." Discuss. 150 words
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Frequently Asked Questions (FAQs)
The four new codes are: The Code on Wages, 2019; The Industrial Relations Code, 2020; The Code on Social Security, 2020; and The Occupational Safety, Health and Working Conditions (OSH) Code, 2020. They consolidate and rationalize 29 central labour laws.
The primary objective of PMVBRY is to incentivize large-scale job creation. With an outlay of ₹99,446 crore, it aims to create over 3.5 crore jobs by providing wage incentives to first-time employees and financial incentives to employers for creating new positions.
The codes prohibit gender-based discrimination in recruitment, wages, and working conditions. They also permit women to work in all sectors, including night shifts, provided their consent is obtained and safety measures are in place, thus promoting empowerment and equal opportunity.
