Little More...to your Workland

Code on Social Security - Cutting the Chase for Busy Corporate Folks

Darshika Desai
Nov 22, 2025By Darshika Desai

India’s work landscape just went through one of the biggest reforms in decades.


On 21st November 2025, the Government of India took a major step toward a more modern, employee-friendly labour framework by rolling out parts of the New Code on Social Security.

Many HR Professionals, including me, have been waiting for this.


The idea is simple:
Bring multiple welfare laws under one umbrella and make social security easier to understand, access, and benefit from.


So what does this mean for YOU?

Earlier, your social security benefits were governed by several separate laws - PF here, Gratuity there, and Bonus somewhere else.

Now, all of this sits under one integrated framework. This is huge “clean-up” that makes your  Rights easier to understand.

The Code now covers:

  • Full-time employees
  • Contract employees
  • Fixed-term employees
  • Gig workers (Swiggy, Uber, Zomato, freelancers on platforms)
  • Platform workers
  • Unorganised sector workers

For the first time ever, India’s growing gig workforce gets formal benefits. That’s historic!

Rules to know:

1. Better Gratuity Rules
The new Code makes gratuity more employee-friendly:

  • More types of leave count as continuous service (medical leave, maternity leave, strike/lockout days).
  • Fixed-term employees can earn gratuity after 1 year — not 5 years.
  • A digital system will make claiming gratuity faster and trackable.

2. Mandatory Appointment Letters
Every employee must now receive a formal appointment letter.
This means:

  • Clearer job terms
  • Clarity on pay, benefits, working hours
  • Stronger proof of employment
    For many parts of corporate India, this ensures transparency across employee groups.

3. Timely Payment of Wages

  • Your salary cannot be delayed.
  • The new Code places legal responsibility on timely wage payment.
  • No ambiguity. No excuses.

4. More Safety & Inclusivity
Women can officially work night shifts — but only with consent and mandatory safety arrangements. Overall safety standards at workplaces will be more regulated.

5. Better Protection for Gig & Platform Workers

This is the highlight of the new Code:

Companies like Uber, Zomato, Amazon, Rapido must contribute 1–2% of their turnover to a Social Security Fund.
This fund will support gig workers through:
- Accident cover
- Life/disability benefits
- Maternity benefits
- Old-age protection

This is a massive step forward for India’s new-age workforce.

6. Digital, Portable Benefits

Social security will now move toward a digital ecosystem.
This means:

  • Easier access
  • Portability if you change jobs/locations
  • Smoother record tracking
    Perfect for today’s mobile workforce!

In Simple Words: What’s the Benefit for YOU?

  • Stronger protection of your financial benefits
  • Faster claims, especially PF, ESI, gratuity
  • More transparency from employers
  • Better safety and inclusiveness
  • If you do gig/freelance work, you are finally protected. This reform aims to make India’s workplaces modern, fair, and future-ready — and you’re at the center of it.

Grey Areas Still Unclear in the Code

While the updated provisions are promising, a few points still lack clarity and await formal notification or rules:

1. Implementation Timeline

Although provisions were announced, the actual date of enforcement for several sections is still unclear. This affects gratuity rules, gig worker contributions, and digital systems rollout.

2. Gratuity Eligibility for Non-Fixed-Term Categories

The law clearly states the 1-year rule applies only to fixed-term employees, but ambiguity remains on:

How “fixed-term” will be defined across industries
Whether renewal of repeated short-term contracts qualifies as “continuous service”

3. Funding Structure for Gig Worker Social Security

The contribution percentages from aggregators/platforms are mentioned, but:

How platforms will report earnings?
Whether incentives count?
How worker identities will be authenticated?

…all remain unclear.

4. Employee Database Integration

The promise of “one social security account” requires system integration, but no timeline or technical details are shared yet.

5. State-Level Variations

Some provisions need state-level rules, and not all states have notified anything yet, leading to interpretation differences.

More clarity is expected in the coming notifications. 

Feel free to hop on the LMW ride again to know more soon!