Four new labor codes have come into effect in the country from 21 November 2025. These codes have created a new system by combining the earlier 29 different labor laws. Now many rules related to work between companies and employees are going to change under the Code on Wages, Industrial Relations Code, Social Security Code and Occupational Safety and Health Code. Although the Central Government has implemented these, the real difference will be visible when the State Governments issue their notifications.
Appointment letter will become a legal document
So far appointment letter It was considered only as an HR document, but after the new Labor Code, its importance will increase. Companies will have to clearly write down issues like salary structure, working hours, holidays and social security in the appointment letter. This means that employees will now be able to enforce their rights on a legal basis. Experts say that companies will have to make changes as soon as the rules are implemented by the state governments. This will increase transparency and strengthen the position of employees.
Big change in salary structure
According to the Code on Wages, now at least 50% of the total salary will be considered as wages i.e. basic salary. Companies will have to increase the basic pay and many allowances may have to be reduced or changed. This may reduce the take-home salary of some people, but benefits like PF, gratuity, bonus, overtime and leave encashment will increase. This means that employees will get more benefits in the long run.
Salary slip will be more transparent
After the new rules, less allowance, more clear deductions, mention of PF and gratuity will be seen in the salary slip. This will make it easier for employees to understand the complete details of their salary.
Changes in working hours and holidays
Under the new rules, work is fixed at 8 hours a day and 48 hours a week. If you work more than this, it will be mandatory to pay overtime. Similarly, the rules of holidays will also have to be written clearly in the appointment letter. The rules of leave accumulation, carry forward and encashment will be transparent.
Social security will be stronger
Benefits like PF, ESIC, Gratuity will now be clearly written in the appointment letter of every employee. Fixed-term and contract employees will also come under the purview of these rights.
What should employees do?
Companies can issue revised letters after the state rules come into force. When employees receive the new letter, it will be necessary to check basic pay, PF, overtime, social security.
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