Our AZB interview has been published by Lexology at An interview with AZB & Partners discussing labour & employment in India – Lexology

What are the most important new developments in India over the past year in employment law?

Over the past year, India’s employment laws have experienced a combination of new developments and ongoing delays. While the central government reforms in the form of labour codes remain formally notified but still await implementation, many states have taken the lead in introducing sector-specific and worker-specific initiatives.

A few main trends stand out: continued delay in the rollout of the new labour codes; progress on state laws for gig and platform workers; and significant state-driven measures aimed at increasing workforce participation and providing greater flexibility in working conditions.

The four new labour codes, namely the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 (COSS) and the Occupational Safety, Health and Working Conditions Code, 2020 (collectively, the Labour Codes), meant to simplify and consolidate India’s employment laws, are still not in effect. Although enacted several years ago, their enforcement is contingent on individual states finalising the corresponding rules. While most of the states have published draft rules, some are yet to do so, which has prevented the central government from notifying a commencement date for the Labour Codes. Policy signals indicate phased commencement could begin in the next financial year once sufficient state rules are finalised. Employers should prepare for changes such as the uniform ‘wages’ definition that is expected to affect statutory contributions; parity in benefits for employees in fixed‑term employment; and revised thresholds for standing orders and approvals.

At the same time, states are moving ahead with new laws for gig and platform workers. While the central government plans to cover these workers under national social security framework under COSS, states such as Rajasthan and Karnataka have already passed their own gig-worker laws. Others, such as Telangana, Jharkhand and Bihar, are working on their drafts. These laws are not limited to social protection alone; they also seek to regulate the terms of gig work itself, including working conditions, payout timelines and grievance redressal mechanisms. With each state adopting different definitions (of similar terms), registration mandates and benefit structures, a key question will be how these state-level laws will interact with the central law framework once the Labour Codes are brought into force.

Notably, striking reforms have emerged in the past year from state-level measures to boost workforce participation and creation of more flexible working arrangements. Restrictions on night shift working of women, long seen as a structural barrier to female employment in certain industries, are being relaxed with safeguards. Several states, including Delhi, Haryana, Gujarat, Maharashtra, Rajasthan, Madhya Pradesh, Odisha and Andhra Pradesh, have proposed or revised their rules to allow women to work night shifts, subject to conditions that prioritise safety and require employers to adopt adequate precautions. Employers should consider implementing state‑specific prerequisites, including written consent, transport and security, and enhanced workplace facilities.

Additionally, as part of efforts to attract investment and improve labour flexibility, many States, including Andhra Pradesh, Gujarat, Karnataka and Maharashtra, have extended permissible working hours, have proposed or allowed for 10-to-12-hour workdays in certain sectors. These changes reflect a concerted effort to strike a balance between productivity and worker welfare, and to align India’s labour norms with global practices in industries that require round-the-clock operations.

Judicial developments also continue to affect the compliance environment. In Stone Hill Education Foundation v Union of India and Others, the High Court of Karnataka struck down provisions of the Employees’ Provident Fund Scheme, 1952 and the Employees’ Pension Scheme, 1995, issued under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 that required higher contributions for IWs. While the Employees’ Provident Fund Organisation (EPFO) has since appealed, no finality has been reached in those proceedings. This has left employers in a state of abeyance, raising questions about the applicability of the ruling, particularly outside Karnataka, and whether they should maintain the status quo until the appeal is decided, or act in accordance with the judgment and revise their contribution practices for IWs, thereby exposing themselves to the risk of regulatory challenge if the EPFO appeal succeeds subsequently.

Further, a pending Supreme Court (SC) litigation may determine the scope of adoptive mother leave entitlements. The SC has reserved judgment in Hamsaanandini Nanduri v Union of India, which challenges Section 5(4) of the Maternity Benefit Act, 1961, that provides for a 12 weeks’ leave for adoptive mothers adopting children under the age of three months (the age limit of three months being in question). Depending on the outcome, adoptive mother leave policies may need prompt revision.

Overall, while central government reforms in the form of the Labour Codes remain pending, states are taking action to address local needs, update work rules and protect different categories of workers. While some of these state-led reforms are motivated by political reasons and divergent ideologies between governments at central and state level, employers need to keep up with the fast-changing employment landscape.

What upcoming legislation or regulation do you anticipate will have a significant impact on employment law in India?

India is at the cusp of transformative reforms that are expected to significantly reshape its employment landscape. The most notable of these are the long-awaited implementation of the Labour Codes, the enforcement of the Digital Personal Data Protection Act, 2023 (DPDPA) together with its draft rules, and the introduction of the India–UK Double Contribution Convention.

As mentioned above, while the Labour Codes introduce significant substantive changes, from an upcoming‑impact perspective, the key things to monitor are now are timing and transition. Employers will need to recalibrate payroll and compliance systems, particularly in relation to the uniform definition of wages and the broadened scope of social security coverage but should maintain readiness and defer final payroll and policy changes until commencement dates and transitional mechanics are notified. For workers, the Labour Codes promise enhanced security, improved workplace conditions and the extension of benefits to categories historically excluded from statutory protections, such as gig workers. With several states already enacting gig worker laws, some reconciliation questions will persist until central government schemes under the COSS are notified.

In parallel, India is preparing for the implementation of the DPDPA, which will replace the existing data protection regime under the Information Technology Act, 2000. The law introduces a comprehensive framework for the processing of personal data. Employers (acting as data fiduciaries) will be permitted under law to process employees’ data for ’employment-related purposes’ without seeking a separate consent, under the ‘legitimate use’ ground. However, for processing employees’ personal data for any other purposes, employers will be required to seek their consent and adhere to other compliance requirements under the DPDPA. The draft Digital Personal Data Protection Rules, 2025 (the DPDP Rules), released in January this year but not yet finalised, provide greater clarity on compliance requirements, including notice standards, processing conditions and cross-border transfers. Once the DPDPA and the DPDP Rules are enforced, employers will need to review and adapt their human resources systems and personal data processing protocols to align with the new regime.

Another development with significant cross-border impact is the proposed India–UK Double Contribution Convention (DCC), part of the Comprehensive Economic and Trade Agreement (CETA), which is awaiting ratification in both countries. Once in force, it will exempt workers from both the countries (temporarily deputed in the other country) and their employers from paying social security contributions in both jurisdictions simultaneously for assignments of up to three years and contributions will only be required in the worker’s home country instead. This will ease the financial burden on both employees and employers, improve take-home pay and make overseas postings more attractive for skilled professionals.

How has the #MeToo movement impacted the investigation or settlement of harassment or discrimination claims in India?

The #MeToo movement has had a notable impact on the raising and redressing of harassment and discrimination claims in India. While the Indian law on sexual harassment of women at workplace, namely the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (the POSH Act) already mandated certain compliances such as constituting internal committees (ICs), strengthening workplace policies and conducting regular training sessions, since the #MeToo movement, employers have become more cognisant of these compliances to create safer and inclusive work environments, particularly for female employees. The movement has empowered women to assert their rights under the law, fostering a culture of accountability and transparency in handling complaints. That said, the movement has not particularly impacted the manner and process of investigation and redressal of these claims since those aspects continue to be driven by the framework provided under the POSH Act.

One significant outcome of the movement has been the increased willingness of survivors to report incidents of harassment, breaking the culture of silence that had long prevailed. Employers, in turn, have recognised the legal and reputational risks of non-compliance and have taken steps to address complaints more proactively. This shift has led to expedited investigations and, in some cases, settlements to resolve disputes more efficiently.

However, the movement has also brought to light various challenges. Survivors often face backlash in the form of defamation suits filed by the accused, creating a chilling effect on those seeking justice. However, courts have increasingly begun to address these challenges by balancing the right to reputation with the need to protect survivors. Recent judicial decisions have underscored that speaking out against harassment is a legitimate exercise of free speech, particularly when done to expose systemic issues or safeguard others from similar experiences.

The widespread use of social media as a platform for #MeToo disclosures has further complicated the legal landscape. While it has provided a space for survivors to share their experiences and mobilise public support, it has also raised concerns about procedural fairness, admissibility of evidence and trial by media. Legal institutions and ICs now face the task of adapting to this evolving dynamic while attempting to ensure fair and unbiased investigations as per the legally defined process.

Despite its successes, the #MeToo movement has also highlighted certain gaps in India’s legal system. For instance, the POSH Act does not extend protections to men or LGBTQ+ individuals, leaving significant sections of society vulnerable. The movement has underscored the need for more inclusive laws. While progress has been made, continued reforms are essential to address the complexities of harassment claims and to ensure justice for all parties involved.