Currently Labour laws are going under the most significant changes in India in decades. To simplify compliance, strengthen protection for worker and Modernized HR practices government has introduced 4 major labour laws that are:

Industrial Relations code, 2020
Code on Social Security, 2020
Occupational Safety, Health and Working Conditions Code, 2020
Code On wages, 2019

All these changes look promising but HR/IR/Compliance team might face some critical challenge like most States and UT still haven’t yet notifies or finalized their Rule draft for these codes, thus making it risky.

Labour Law and the Concurrent List

In the constitution of India, labour law is part of Concurrent list, so both State legislature and Parliament legislature have the authority to make all the laws related to labour law.

So, what does this means for HR compliance?

1. Both the government of central and state can legislate on Labour issues.

2. Law made by central parliament can only become enforceable if only state officially notifies them and publishes rules.

3. State may delay and amend own specific rules and compliance requirement can also differ.

4. Enforcement differs and depends on state specific notifications and rules, but in case of conflicts central law prevails.

Key Insight: HR leaders should not assume that new labour codes are enforceable nationwide until states notify the rules.

These UTs and state are yet to publish labour codes drafted rules:

State / UT	Pending Codes
West Bengal	All Labour Codes
Lakshadweep	Code on Wages, 2019
NCT of Delhi	Code on Industrial Relations, 2020; OSH Code, 2020
Tamil Nadu	Code on Social Security, 2020
Nagaland	Code on Industrial Relations, 2020

Implication of these codes on business and establishment is that they cannot implement policy changes bases on these codes without risking the legal and financial consequences in these regions.

Q1. Why is Premature Policy Changes Risky?

It is risky because on violation existing labour laws of states can lead to penalties, increasing the legal exposures.
It still lacks the trust of employees, as these looks promising but later can be adjusted and led to the dissatisfaction and disputes.
By implementing these policies it may enhance the unforeseen costs such as leave pay out an gratuity.
It creates the operational confusion and lead to create confusion among managers and employees.

Q2. What are the best Practices for HR Teams

HR should continue following the state specific labour laws until or unless official notifications are released.
HR should always monitor the state and central notifications for any recent changes in labour laws.
Should draft policies for planning purpose but don’t implement them yet.
HR should make it clear to employees that changes are still pending with state notifications.
HR should assess all the operational and financial impacts before prematurely changing the policies.

Key Takeaways

Concurrent list includes the labour law, that means both the state and central level government can make the rules.
It needs state approvals for central new labour to implement in the state.
Many states and UTs like Lakshadweep, Delhi, Tamil Nadu, Nagaland and West Bengal still haven’t notified some rules for the same.
All these premature policy can changes may lead to financials, operational risks and legal risk.
The safest way is to plan, communicate and monitor while waiting for official notifications.

Conclusion

The introduction of India’s four Labour Codes marks a major step toward modernizing labour laws and standardizing HR practices. However, their enforceability depends on state-level notifications, as labour law is part of the Concurrent List. Many states and UTs like Lakshadweep, Delhi, Tamil Nadu, Nagaland and West Bengal still haven’t notified some rules for the same.

For HR leaders and organizations, the key takeaway is clear HR should assess all the operational and financial impacts before prematurely changing the policies regardless of states. All these premature policy can changes may lead to financials, operational risks and legal risk.

From 21st November 2025, New Labour codes have been effective, but still their practical implementation is pending. Until both the state and central rules are officially notified, Employers are not required to follow new frameworks.

The safest way is to plan, communicate and monitor while waiting for official notifications and maintain compliance with existing laws.

Frequently Asked Questions:

Q1: Are the new Labour Codes applicable nationwide?
A: No. States must notify their rules before the codes are enforceable locally.

Q2: What do you mean by “Concurrent List” in Labour law?
A: It means that both state and central government can make the laws on labour law matters.

Q3: Can we implement one-year gratuity immediately?
A: No. One can avail the benefits under the new labour law if only state notifies rules.

Q4: What are states which still haven’t notified all the labour codes yet?
A: These states are West Bengal, Lakshadweep, Nagaland, and Tamil Nadu.

Q5: Could these policies be drafted by HR policies now?
A: Yes, but implementation must wait until official notifications.

Q6: Are draft rules enforceable?
A: No. Draft rules are only proposals and don’t have legal effect.

Q7: What is the risk of changing HR policies prematurely?
A: Legal penalties, financial liabilities, employee disputes, and operational confusion.

Q8: On dispute between state and central law, which will override?
A: When there is conflict, central law prevails but only if it’s enforced by state notifications

Q9: When will all states notify the Labour Codes?
A: There is no uniformity in schedule as timelines varies for state to state.

Q10: Could we communicate these policies and changes to employees in advance?
A: Indeed we can clarify about these changes and state that implementation is still pending with state notifications.

Q11: Do all four Labour Codes apply at once?
A: Only once a state has notified rules for each code individually.

Q12: Can partial implementation of codes be followed in a state?
A: Yes, but only for codes that have been officially notified in that state.

Q13: What happens if a company applies codes before notification?
A: They risk legal non-compliance and penalties under existing state laws.

Q14: Is tracking state gazettes necessary?
A: Yes, HR must monitor official notifications to ensure compliance.

Q15: Are fixed-term employees affected by new gratuity rules?
A: Only once the code is notified in the respective state.

Q16: Can payroll systems be updated now?
A: You can prepare internally, but changes should not be implemented until rules are notified.

Q17: Do all states need to notify codes simultaneously?
A: No. Each state has its own timeline for notification.

Q18: If there any difference in rules among states?
A: Yes, these rules are state specific and delayed notifications.

Q19: Could companies’ offer any new voluntarily benefits before notifications?
A: Indeed, they can but it’s optional and it may lead to additional liabilities.

Q20: What is the safest approach for HR teams now?
A: The safest way is to plan, communicate and monitor while waiting for official notifications

Don’t Rewrite HR Rules: Labour Codes Not Notified Yet

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