Labour Laws Practice
Our Labour Laws practice at S.S. Rana & Co. advises employers across India on the four Labour Codes consolidating twenty-nine central statutes, employment contracts and HR policies, industrial disputes and retrenchment compliance, POSH implementation, and contractor engagement. India’s employment law landscape has changed more fundamentally in the past five years than in the preceding three decades, and employers must simultaneously track predecessor statute compliance and prepare for Code implementation on a state-by-state timeline.
- The four Labour Codes consolidate twenty-nine central statutes. State-level rules are being notified on varied timelines — employers with operations across multiple states must track the compliance position in each state individually.
- Standing orders under the Industrial Employment (Standing Orders) Act, 1946 remain in force until superseded by the Industrial Relations Code; employers covered by the Act must maintain certified standing orders covering the terms and conditions of employment.
- POSH compliance under the Sexual Harassment of Women at Workplace Act, 2013 is mandatory for all employers with ten or more employees. An ICC must be constituted, a POSH policy maintained, and annual reports filed.
- Termination of workmen under the Industrial Disputes Act, 1947 requires retrenchment compensation at fifteen days’ wages for every completed year of service. Establishments above specified worker thresholds require prior government approval for closure.
- Misclassification of employees as contractors is one of the most common and most consequential labour law risks for Indian businesses. Principal employers remain liable for statutory benefits to contract workers where contractors default.
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The Four Labour Codes — What They Cover and When They Apply
The Code on Wages, 2019 consolidates the Payment of Wages Act, the Minimum Wages Act, the Payment of Bonus Act, and the Equal Remuneration Act. It applies to all employees regardless of wage ceiling. The Industrial Relations Code, 2020 consolidates the Industrial Disputes Act, the Trade Unions Act, and the Industrial Employment (Standing Orders) Act — governing industrial disputes, trade union recognition, collective bargaining, and the conditions for retrenchment and closure. The Code on Social Security, 2020 consolidates provident fund, gratuity, ESI, and maternity benefit obligations. The Occupational Safety, Health and Working Conditions Code, 2020 consolidates thirteen statutes governing workplace safety, working hours, and principal employer obligations regarding contract workers.
State-level rules under each Code are essential for compliance and are being notified on varied timelines. We advise employers to track state-level rule notifications for each state in which they employ workers, and to assess their compliance position against both the current statute framework and the emerging Code framework simultaneously.
Employment Contracts, HR Policies, and Standing Orders
We draft and review employment contracts, offer letters, appointment letters, HR policies, and standing orders. Employment contracts must address probation terms, termination notice and procedures, confidentiality and IP assignment obligations, non-solicitation provisions, and POSH policy acknowledgment.
Standing orders under the Industrial Employment (Standing Orders) Act, 1946 must be certified by the Certifying Officer for establishments above the applicable threshold number of workers. We advise employers to customise standing orders to accurately reflect actual conditions of employment rather than simply adopting model standing orders.
“Retrenchment in India is a legally precise exercise, not a commercial decision that can be managed informally. The cost of non-compliance — reinstatement with back wages — typically exceeds the cost of proper retrenchment by a significant margin.”Industrial Disputes, Retrenchment, and Workforce Restructuring
We advise employers on industrial dispute proceedings before Labour Courts, Industrial Tribunals, and the Central Government Industrial Tribunal. The most consequential matters we handle are: wrongful termination and retrenchment claims; non-payment of wages or benefits; and disputes arising from organisational restructuring.
Retrenchment compliance requires retrenchment compensation at fifteen days’ wages for every completed year of service, prior notice or payment in lieu, and for establishments above the prescribed worker threshold, prior government approval. We advise on the complete retrenchment process and on managing the notice period, documentation, and settlements.
Contract Labour, Contractor Engagement, and Principal Employer Liability
We advise employers on contractor engagement structures and on the principal employer’s liability under the Contract Labour (Regulation and Abolition) Act, 1970. Principal employers are liable for statutory benefits to contract workers if the contractor defaults on payment of wages, ESI, or PF contributions. We advise on contractor agreement structures that create the right indemnity and audit rights to manage this exposure, and on the abolition of contract labour where government notification has prohibited it in specific occupations. Across 13 partners and 220+ professionals from offices in New Delhi, Mumbai, Chennai, Hyderabad, and Bangalore.
Frequently Asked Questions
labour-laws-practice-faq
Termination of services for workmen — employees whose role involves manual, unskilled, skilled, technical, operational, clerical, or supervisory work and who are covered by the Industrial Disputes Act, 1947 — is currently governed by that Act and the corresponding state rules. When the Industrial Relations Code, 2020 is fully implemented in the relevant state, it will govern in its place. The Code broadly retains the retrenchment compensation framework: fifteen days’ average pay for every completed year of service, prior notice or pay in lieu, and prior government approval for establishments above the threshold.
Under the Industrial Disputes Act, 1947, a workman who has been in continuous service for not less than one year must be paid retrenchment compensation equal to fifteen days’ average pay for every completed year of continuous service or any part thereof in excess of six months. One month’s prior notice or pay in lieu is also required. For establishments employing a hundred or more workmen (or the threshold as revised under state rules), prior government approval for retrenchment is mandatory.
Yes. The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 applies to all employers with ten or more employees — regardless of sector, type of business, or whether the employees are permanent, contractual, or temporary. Every such employer must constitute an Internal Complaints Committee with the prescribed composition, adopt and circulate a POSH policy, provide POSH training, and file an annual report with the District Officer.
The distinction between an employee and a contractor under Indian labour law is based on the degree of control the principal exercises over the worker’s work — not merely on the label in the engagement contract. Where the principal controls how and when the work is done (not merely the output), the worker is likely to be treated as an employee regardless of how the engagement is described. Misclassification as a contractor when the worker is in substance an employee exposes the principal to liability for unpaid statutory benefits, ESI, PF, and gratuity.
Standing orders under the Industrial Employment (Standing Orders) Act, 1946 are certified documents that specify the conditions of employment for workmen in an industrial establishment — covering classification of workmen, manner of informing workmen of work hours, shift timings, attendance, leave, disciplinary procedure, and termination. They must be certified by the Certifying Officer for establishments employing one hundred or more workmen (or the applicable threshold under state rules). They remain in force until the Industrial Relations Code, 2020 is implemented in the relevant state.