UPSC Darpan

EconomyGS31 October 2026

Ten months after the Labour Codes took effect, only 10 States and UTs have notified rules

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The news

New Delhi. Over 10 months after the four Labour Codes came into force, only 10 States and Union Territories have notified rules under at least one of them, The Economic Times reports, citing government data. Ten have finalised rules under the Occupational Safety, Health and Working Conditions (OSH) Code, 2020; nine each under the Industrial Relations Code, 2020 and the Code on Wages, 2019; and eight under the Code on Social Security, 2020. They include Andhra Pradesh, Bihar, Gujarat, Rajasthan, Uttar Pradesh and Mizoram. Major industrial States — Karnataka, Tamil Nadu, Maharashtra, Telangana, Haryana and Punjab — have not finalised theirs. Employers face clashing rules: the Codes let workers carry forward 30 days of leave, while Maharashtra’s Shops and Establishments Act allows 45; the OSH Code’s single-window electronic registration sits beside Haryana’s Shops Act, 1958, which still demands separate registration. The Union Labour Secretary has met States to press them.

The chain in one line: 29 central labour laws criticised as complex → consolidated into four Codes in 2019-20 → Centre brings them into force on 21 November 2025 → each “appropriate government” must notify its own rules → most big industrial States delay, leaving employers with two sets of rules

Static syllabus linkage

  1. Labour is a Concurrent subject, so the Centre legislates but States complete the law. Entries 22 (trade unions, industrial and labour disputes), 23 (social security, employment) and 24 (welfare of labour, conditions of work, provident fund, maternity benefit) of List III of the Seventh Schedule cover labour. Under Article 254, a central law prevails over a repugnant State law, unless the State law has received the President’s assent.
  2. The four Codes leave the decisive detail to the “appropriate government”. The Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the OSH Code, 2020 replaced 29 central laws. For most establishments the State is the “appropriate government”, so its rules fix forms, registration, inspection and many thresholds.

Why UPSC loves this

  1. GS2 and GS3 meet in labour reform. The syllabus lines “issues and challenges pertaining to the federal structure” and “growth, development and employment” together make labour reform a test of cooperative federalism in implementation, not only in law-making.

Prelims nuggets

  • Trade unions and industrial disputes are Entry 22, and welfare of labour including conditions of work is Entry 24, of the Concurrent List.
  • The four Labour Codes are the Code on Wages, 2019; the Industrial Relations Code, 2020; the Code on Social Security, 2020; and the OSH Code, 2020.
  • Under Article 254(2), a State law on a Concurrent subject that conflicts with a central law prevails in that State if it has received the President’s assent.
  • The Code on Social Security, 2020 recognises gig workers and platform workers as categories eligible for social security schemes.

Analysis

  1. Lens — Centre and States: a Concurrent law is only half-made until States write rules. Parliament could pass the Codes, but working hours, registration and inspection reach a factory through State rules. Delay is not always obstruction: rules are where States bargain over thresholds that matter to their industry and unions. The judgement is that the Centre should persuade through model rules and deadlines, not override, because a Code that States resent will be enforced half-heartedly.
  2. Workers lose most from the delay, not employers. Firms complain of compliance costs, but they can live with old rules. A gig worker’s new social-security entitlement, or a uniform wage floor, means nothing until rules and portals exist, and only eight States have notified social security rules.
  3. Divergent rules can rebuild the maze the Codes were meant to clear. Consolidation aimed at one simple national regime. If each State sets its own shift hours, overtime limits and standing-order thresholds, a firm with plants in five States again faces five regimes. The counter-view is that diversity lets States compete for investment and test ideas. The balance: a common floor of protection, with States free to vary procedure.

Possible Mains question

“Labour reform in India is decided less in Parliament than in State rule-making.” Comment. (10 marks, 150 words)

Model approach

  1. Directive — Comment. Give a reasoned opinion on the statement, with evidence, in one dimension: federal implementation.
  2. Introduction — four Codes, 29 laws, in force since 21 November 2025. About 20 words on the consolidation.
  3. Body — only 10 States and UTs have notified rules. Value addition: OSH 10, Wages and IR 9 each, Social Security 8 (ET data); big industrial States missing.
  4. Body — State rules decide registration, leave and thresholds. Use the Maharashtra and Haryana examples; draw a flowchart: Code → appropriate government → rules → worker.
  5. Conclusion — model rules and deadlines through cooperative federalism. Harmonise without overriding Concurrent-List autonomy.

Administrator's brainstorm

As Labour Secretary of a large industrial State that has not notified the rules, how would you proceed?

I would publish draft rules for each Code with a fixed comment period, so unions and employers argue over text, not rumours. Where the State genuinely differs, as on leave or thresholds, I would state and defend that rather than delay the whole set. I would prioritise social security rules, which create entitlements for workers who have none. Delay protects no one.