Govt notifies rules for all labour codes, drops minimum wage calculation criteria
Giving effect to the new labour codes in full after having brought them in November 2025, the government has now notified final rules for all four codes after a four-month gap from draft rules. A national floor wage by Centre in consultation with an advisory board along with states; a normal working day of eight hours with weekly cap of 48 working hours; mandatory wage slips; social security fund for unorganised sector and gig workers — these are some of the key provisions that will come into effect, with states to follow suit.
However, in a critical omission from the draft rules published in January, the Centre has dropped the criteria for calculating minimum wage in the final Code on Wages (Central) Rules, 2025, stating that the criteria will be “separately specified by the central government by special or general order”. This is likely to result in lower minimum wages and higher wage disparities for the same worker category across states, experts said.
The draft rules in January had included the earlier criteria for calculation of minimum wage which was linked to net intake of 2,700 calories per day per consumption unit; 66 meters of clothing per year per standard working class family comprising the worker, a spouse and two children; and housing rent expenditure of 10% of food and clothing expenditure apart from fuel, electricity and other miscellaneous expenses as 20% of minimum wage; and 25% of minimum wage as expense for children education, medical, recreation and contingencies. This formula had evolved in line with the landmark 1991-Supreme Court judgement in the Reptakos Brett case and recommendations of the 15th Indian Labour Conference (ILC) in 1957.
The removal of the formula for fixing the minimum wage from the final version of the rules for Code on Wages is likely to result in lower-than-potential wages for workers as wages play a key role in collective bargaining, said K R Shyam Sundar, labour economist and former professor at XLRI. “The consequence of the removal of the criteria for fixing minimum wage from the rules is that it will lead to unscientific and inconsistent criteria for calculation of minimum wages across states. This will exacerbate the differential in wages for the same category of worker, say, unskilled worker. Otherwise, wages for an unskilled worker used to be similar across the states,” Sundar said.
Separately, the new wage rules state that a floor wage will be fixed by the central government taking into account “the minimum living standard clothing, housing and any other factor considered appropriate by the central government from time to time”. Under Section 9 of the Code on Wages, 2019, the central government has the power to fix the floor wage taking into account minimum living standards of a worker, provided that different floor wages may be fixed for different geographical areas. The floor wage will act as a baseline wage below which states cannot fix their minimum wages, which is going to be closely eyed given the recent backdrop of a spate of workers’ protests across several industrial hubs in the country.
Working hours, social security
The government specified that the number of working hours in a normal working day for an employee whose wage period is on a daily basis will be eight hours. For those employed on other than the daily wage mode, the number of working hours will be fixed in a manner to not exceed the weekly cap of 48 hours. Interval for rest will be fixed separately under the Occupational Safety, Health and Working Conditions Code, 2020.
Setting the weekly limit at 48 hours for those not on daily wage, will help many workplaces provide flexible working hours for employees, especially in sectors which follow a hybrid work model, allowing work-from-home.
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Under the Social Security (Central) Rules, 2025, Aadhaar-linked registration of every unorganised worker aged above 16 years is mandatory. Every aggregator engaging any new gig and platform worker will have to register such worker on a designated portal of the central government in real time and will also have to provide the exit details of gig and platform worker registered with them on the portal.
A National Social Security Board will also be formed for gig and platform workers, which will include members from Lok Sabha, Rajya Sabha, unorganised sector workers’ and employers’ associations, states, and representatives from scheduled castes, scheduled tribes, women and minorities, the rules stated.
Under the Occupational Safety, Health and Working Conditions (Central) Rules, 2026, the government has allowed for electronic application for single licence for contractors working in more than one state or for the whole country. The approval or disapproval has to be granted within 45 days.
For women workers, who have been allowed to work in the night shift under the OSH Code beyond 7 PM and before 6 AM, the consent of the female employee has to be taken by the employers in writing, the rules said. Also, adequate transportation facilities have to be provided for pick-up and drop for such women employees at her residence in addition to safe and well-lit workspace.
