India’s Workers Stuck in Reform Limbo as States Shoulder the Burden
Updated: June 03, 2025 20:19
Image Source: Live Law
India’s ambitious labour reform agenda has left millions of workers in uncertainty as the central government passes the responsibility for implementing key changes to individual states. The move, intended to modernize regulations and boost investment, has resulted in a patchwork of rules and inconsistent protections for workers across the country.
Key Highlights:
The central government’s plan to consolidate 29 labour laws into four simplified codes is stalled, with official notification still pending. In the interim, at least 20 states and union territories have amended their own labour laws to meet industry demands, particularly raising retrenchment thresholds and easing compliance requirements.
Workers are caught in limbo as states implement reforms at varying speeds, creating confusion over rights, benefits, and job security. Many fear loss of social security provisions such as Provident Fund and Employees’ State Insurance, especially as thresholds for worker classification and protections are raised.
Some states, like West Bengal, have openly opposed the central reforms, vowing to protect worker benefits and resist changes they see as detrimental.
The lack of uniformity is complicating compliance for businesses operating across multiple states and undermining collective bargaining power for workers.
Experts warn that while reforms aim to make India more attractive for manufacturing and investment, the fragmented approach risks leaving vulnerable workers without adequate safeguards.
Calls are growing for a standardized, nationwide framework to ensure both ease of doing business and protection of worker rights.