Fragile protections for workers weakened further by New Labour Codes

Workers begin protests spread across 500 districts

Sharply contesting government’s narrative that the new Labour Codes, notified recently, strengthen workers’ rights, a large number of trade unions, representing workers in formal and informal sector, have begun protests across 500 districts all over the country. Workers say that the new rules further threaten already fragile job security, weaken collective bargaining and increase employer control.

New labour codes recently introduced by the union government and hailed as ‘revolutionary’ steps in protection of workers’ rights have been met with nationwide anger by workers and unions all over the country who have slammed the government for projecting a false narrative on the actual impact of the new codes on workers, their rights and welfare.

As a result, protests have erupted in nearly 500 districts across the country, including in Delhi. The unrest follows the government’s rollout of four sweeping labour codes, a move unions say threatens job security, weakens bargaining rights and shifts power sharply toward employers.

On November 21, the Indian government notified four sweeping labour codes replacing 29 older labour laws in what it called the most significant overhaul of employment law in decades. But within days, a wave of anger and anxiety spread across the country. On November 26, a joint platform of 10 central trade unions, supported by large farmer organisations, called for nationwide protests; what followed was among the largest outpourings of worker unrest in recent years.

According to union statements, the protests have taken place in over 500 districts nationwide, drawing participants from formal, informal, agricultural, industrial and service sectors. Thousands of workers  unionised and unorganised have marched out on streets, held sit-ins, black-badge demonstrations and candle-light vigils in cities large and small: from major metros to small towns.

For many of these protesters, the new labour laws do not feel like reform or protection but like a betrayal of longstanding rights. As union and activist voices repeatedly put it, the codes threaten to erode job security, weaken collective bargaining and make workers more vulnerable to abuse.

At the heart of the protest is a broad concern that the reforms shift power dramatically toward employers.

One of the most contentious changes under the new Industrial Relations Code, 2020 is the hike in threshold for requiring government permission before layoffs. Earlier, firms needed approval if they employed over 100 workers; under the new law, this threshold has risen to 300 employees. That means hundreds of thousands of small and medium firms which hire in the 100–300 range  now have the legal leeway to retrench workers without oversight or safeguard.

Many unions warn that this effectively legalises “hire-and-fire” across a large slice of Indian industry. As one statement by a labour leader put it, the new laws facilitate “corporate exploitation, contractualisation and unrestrained hire-and-fire,” calling the reforms a “deceptive fraud” against the working class.

Beyond layoffs, the codes also enshrine easier fixed-term employment, loosening restrictions on contractors and temporary workers, a move that critics say will institutionalise precarious work, with lower job security and weaker bargaining power.

Legal experts and labour rights advocates have also raised serious concerns about the labour codes, saying that they undermine both job security and collective bargaining. While the reforms are presented as modernising labour laws, many warn that they consolidate power in favour of employers and weaken the ability of workers to organise effectively. According to these experts, certain provisions could make it nearly impossible for unions to negotiate on behalf of employees, leaving workers vulnerable despite the promises of protection.

Ali Zia Kabir Choudhary, a prominent labour lawyer based in Delhi, described the opposition in stark terms.

“Section 77(1) of the Industrial Relations Code, 2020 reduces the threshold for labour law applicability from 100 to 300 workers. This means establishments with up to 299 employees can retrench staff or shut operations at will. Most Indian factories employ between 50 and 300 workers, so this effectively removes job security for millions. Section 2(o) allows fixed-term contracts of up to 11 months, which employers can rotate indefinitely, denying workers benefits and preventing unionisation. Section 62(1) requires 60 days’ notice for strikes, making them largely ineffective, while Section 94 of the Code on Wages decriminalises wage theft employers now face only fines instead of imprisonment, meaning many may withhold wages and pay a fine while still saving costs. These provisions hollow out workers’ rights under the law,” Choudhary tells Media India Group.

According to the Ministry of Labour and Employment, over 12 million workers are employed in establishments with 50–300 employees, meaning this change potentially affects more than 12 million jobs nationwide.

Choudhary emphasises the broader consequences of these changes for workers’ livelihoods and collective rights.

“The way fixed-term contracts are structured, employers can essentially mimic a ‘perpetual temporary’ workforce. Workers may be on 11-month contracts for years, performing identical duties without any benefits or protections. This undermines union formation and collective bargaining, as long-term contractual employees are barred from joining unions. On strikes, the extended 60-day notice period ensures that any industrial action is neutralised employers can simply hire replacement staff or adjust workflows in advance. And with wage violations now decriminalised, the incentive for employers to comply with minimum wage laws is minimal. These laws, instead of protecting workers, institutionalise precarity and weaken their voice in the workplace,” says Choudhary.

Union leaders also argue that key rights have been diluted. The new regime, they say, makes it harder for workers to form unions, weaken protections around strikes and introduces procedural obstacles to collective bargaining and labour court adjudication. In a joint memorandum delivered to the President, protestors have demanded immediate withdrawal of the codes, saying these changes negate decades-old labour rights won after long struggle under colonial and post-independence labour movements.

For many workers  especially those in informal, casual or contract-based employment  the worry is simple: the protections promised such as minimum wage floors, social security, formal contracts remain on paper, while in reality they face precarity, unpredictability and weaker protections.

In Gurugram, just outside Delhi, the protests saw participation from factory workers, contract labourers, daily-wage earners  all united in fear and frustration. “I have seen two layoffs this month alone. If my employer now gets power to fire up to 300 people without permission I don’t know when I will be next,” Suresh Patil, one of the protestors, tells Media India Group.

According to Choudhary, these changes clearly threaten job security. Section 14 of the Industrial Relations Code recognises only a ‘sole negotiating union’ with at least 51 pc membership. But union memberships fluctuate, and employers can rotate contractual workers just before negotiations, preventing unions from reaching that threshold. In practice, this means collective bargaining is effectively impossible.

Choudhary highlighted serious flaws in the enforcement and practical implementation of the new labour codes. He warned that without strong oversight, the protections promised on paper would remain out of reach for the vast majority of India’s workforce.

A key red-flag is the widening grey zone of fixed-term, contract and informal employment combined with easier retrenchment norms. For many sectors that rely on contract labour or short-term workers manufacturing, services, small industries  this could lead to widespread job instability, reduced bargaining power, and increased vulnerability.

Critics also point out that consolidation from 29 labour laws down to four while touted as simplification actually removes many existing safeguards. The number of regulatory provisions has shrunk sharply, from over 1,400 to roughly 350, and inspection regimes, union rights, grievance redressal mechanisms and labour-court protections have been highly diluted.

Moreover, trade union leaders highlight dire risk of social security and welfare promises becoming hollow if enforcement is weak. Even though the new Code on Social Security, 2020 extends benefits to gig and informal workers, recall that a large majority of India’s workforce  estimated at over 80 pc is informal; many of them may find it difficult to register, claim benefits or demand compliance in hostile workplaces.

With rights to strike, union formation, collective bargaining curtailed or made more difficult, critics fear the new laws may institutionalise power imbalance  giving employers leverage to dictate terms, restructure the workforce at will, and avoid long-term commitments.

Legal experts highlight that provisions allowing self-certification, limiting inspection powers, and decriminalising employer offences significantly weaken accountability. According to them, these measures not only fail to safeguard workers but actively dilute their fundamental rights, undermining job security, unionisation, and the right to fair wages.

“The government claims the codes expand protections, but the reality is very different. Section 51 of the OSH Code, 2020 moves inspections online and relies on self-certification by employers. Government websites rarely function properly, workers lack digital literacy, and self-certification is effectively self-exemption. Section 34(1) of the Code on Wages turns inspectors into advisors rather than enforcers. Enforcement of labour laws in India has always been weak, especially for marginalised workers. About 90 pc of the workforce is in the informal sector, entirely outside legal protection even before these codes. Labour inspectors are overstretched, with a ratio of 1:15,000 workers, and corruption is rampant. These new laws exempt most factories by some estimates more than two-thirds decriminalise employer offences, make unionisation harder, render strikes symbolic, and remove any remaining job security. Employment is not just a labour right but a right to livelihood, a fundamental right under Article 21 of the Constitution. By diluting these protections, the codes undermine the very core of workers’ rights, leaving them with little recourse,” says Choudhary.

Choudhary emphasises that without proper enforcement and accountability, these laws may exist only on paper.

“The fundamental rights of workers are being hollowed out, and protests are not just a choice  they are a duty to protect livelihood and dignity,” he adds.

Umer Masoodi, another labour lawyer, also highlights the practical challenges and risks that the new labour codes pose for workers, particularly in smaller enterprises. They warn that while the reforms appear to modernise labour laws on paper, the added compliance burdens and provisions favouring employers could unintentionally undermine job security, weaken collective bargaining, and leave vulnerable workers exposed.

“While the reforms aim to simplify processes, the transition will not be frictionless, especially for MSMEs. Consolidating 29 older laws comes with new record-keeping and compliance requirements wage registers, timely payments, social security enrolments, written appointment letters, and safety compliance. For smaller firms operating on thin margins, this could be a heavy burden, leading to cash-flow problems or even informal hiring practices. At the same time, some provisions  layoffs, fixed-term employment, and higher retrenchment thresholds give employers greater flexibility, which could undercut job security and weaken collective bargaining. Without robust social security mechanisms and compliance infrastructure, vulnerable workers may remain exposed,” Masoodi tells Media India Group.

There are over 63 million MSMEs in India, employing more than 110 million people. Even minor increases in compliance costs could directly impact millions of livelihoods, he warns.