New Era of Labour Reform: 4 Labour Codes replacing 29 labour laws came Into effect from 21 November 2025

India’s New Labour Codes:

India has introduced four new Labour Codes, replacing 29 old labour laws with a single, simplified system. For startups, MSMEs, and fast-growing companies, this is a major shift in how hiring, salaries, compliance, and employee benefits will work going forward.

In simple words, the government’s goal is to make jobs more secure for workers and compliance easier for businesses.

Why This Reform Was Needed

Most of India’s earlier labour laws were written decades ago, long before startups, gig work, and platform-based businesses came into existence. This created confusion, heavy paperwork, and unclear rules. The new Labour Codes aim to fix this by bringing all major labour rules under one modern framework.

What Changes for Startups?

The biggest change is that appointment letters are now compulsory for all employees. This improves transparency and protects both the employer and the employee.

Minimum wages now apply to everyone, across all sectors, which helps prevent underpayment and disputes.

For the first time, gig and platform workers are officially recognized, and companies must contribute towards their social security. This impacts food delivery, ride-hailing, and freelancer-driven platforms.

Salaries must be paid on time, and clearer wage rules reduce payroll disputes.

Women are now allowed to work night shifts and in more industries, with proper safety and consent measures in place.

Another huge relief for startups is simplified compliance. Instead of multiple registrations and returns, businesses now follow a single registration, single license, and single return system.

Why Founders and CXOs Should Care

These reforms directly affect:

Hiring structure

HR policies

Payroll systems

Legal risk management

Investor confidence

Startups that adopt these changes early will face fewer compliance risks, build better workplace culture, and improve their employer brand.

Final Thought

India’s new Labour Codes are not just legal reforms—they are a reset for the future of work. For startups, this is the right time to formalize HR systems, clean up payroll processes, and build strong people practices that support long-term growth.

Strong startups are built on strong workforces.