India has begun a landmark overhaul of its labour laws, consolidating 29 complex federal statutes into four streamlined codes—a move hailed by the government and businesses as a crucial modernisation but condemned by trade unions as the largest rollback of workers’ rights since independence.
The reforms aim to drastically reduce the regulatory burden, slashing the number of governing rules from 1,400 to about 350 and cutting required forms from 180 to 73. Proponents, including economists and industry groups, argue this will boost manufacturing, attract foreign investment, and finally integrate India into global supply chains by creating a more flexible labour market. “This is an important signal that [India] is keen to ease doing business,” noted Nomura brokerage.
However, the changes have sparked nationwide protests. Unions are incensed by two key provisions: raising the threshold for government permission to lay off workers from 100 to 300 employees, and extending a mandatory 14-day strike notice to all industries. They argue this strips workers of bargaining power and excludes a huge section of the workforce from protection.
While the new codes introduce progressive measures like uniform minimum wages, mandatory appointment letters, and protections for gig workers, the debate highlights a fundamental ideological divide. Supporters see flexible hiring and firing as essential for competitiveness, while critics contend that weak consumer demand—not rigid labour laws—is the true brake on India’s economy, and warn that eroding worker rights will only exacerbate this problem.
By James Kisoo
