Issue Highlights
- Can Companies Operate with a Small Permanent Workforce?
- Building a Future-Ready Workforce
- Why Investors Are Increasingly Reviewing Labour Compliance
- Occupational Mental Health
- Labour Compliance under India’s New Labour Codes
- The Future of Employment: Permanent, Contract or Fixed-Term?
- Wage Restructuring
Upcoming Book: “Decoding New Labour Codes” — simple, practical and powerful guidance for employers, professionals and employees.
INSIGHT 01
Can Companies Operate with a Small Permanent Workforce?
Yes. The New Labour Codes give companies flexibility to design their workforce according to business requirements. Businesses may retain a small permanent core team and engage fixed-term, contract, gig or platform workers for other functions, subject to proper legal compliance.
It is about the right workforce mix, not merely the size of the permanent headcount.
What the New Labour Codes Enable
Multiple Forms of Employment
Permanent, fixed-term, contract and gig workers may be engaged according to genuine business needs. |
Fixed-Term Employment
Employees may be hired for a defined period, task, assignment or project. |
Contract Labour Regulation
Contract workers should be engaged through compliant arrangements with clearly defined responsibilities. |
Gig and Platform Workers
The framework recognises gig and platform workers and provides for applicable social-security measures. |
Why It May Work
- Retains a strong permanent core team for strategic and critical functions.
- Allows quick scaling according to workload and demand.
- Aligns workforce costs with business requirements.
- Provides access to specialised talent.
- Improves agility when supported by clear records and compliant contracts.
Compliance Reminder: Contract or fixed-term structures must not be used to avoid statutory obligations. Employers should ensure proper classification, timely wages, social-security compliance and accurate documentation.
INSIGHT 02
The Road Ahead: Building a Future-Ready Workforce
As India’s labour landscape evolves, organisations must develop agile, inclusive, skilled and compliant workforces that are ready for present responsibilities and future opportunities.
Five Core Pillars
- People First: Place employee well-being, fairness and inclusion at the centre of decisions.
- Continuous Skilling: Invest in reskilling and upskilling.
- Adaptability and Agility: Build flexible systems that respond quickly to change.
- Compliance by Design: Embed legal compliance, ethics and transparency into HR processes.
- Technology Enablement: Use digital tools, automation and AI to improve productivity.
Roadmap
Assess current skills and compliance → Align HR strategy with business goals → Transform people, processes and technology → Engage employees → Sustain progress through monitoring and improvement.
“The future of work is not about replacing people with technology, but empowering people with possibilities.”
INSIGHT 03
Why Investors Are Increasingly Reviewing Labour Compliance
Labour compliance is no longer viewed merely as a legal obligation. Investors increasingly see it as an indicator of governance quality, operational stability, responsible business conduct and long-term sustainability.
Key Areas Investors Review
- Employment contracts, wages, working hours, overtime and benefits.
- PF, ESI, gratuity, bonus, professional tax and labour welfare compliance.
- Workplace safety, POSH compliance and risk assessments.
- Grievance redressal and disciplinary procedures.
- Statutory registers, returns, notices and policy documentation.
- Contractor, vendor and supply-chain labour compliance.
Business Impact: Strong labour compliance can improve investor confidence, reduce hidden liabilities, support ESG performance, facilitate transactions and strengthen long-term business value.
INSIGHT 04
Occupational Mental Health under the OSHWC Code, 2020
Mental health forms an important part of occupational safety and employee well-being. A safe and healthy workplace should address both physical and psychological risks.
Key Areas of Focus
- Safe and healthy working conditions.
- Employee welfare facilities and support systems.
- Information, instruction and training on workplace stress and mental health.
- Right to refuse work involving imminent danger.
- Reporting of accidents, incidents and work-related health concerns.
- Health surveillance for high-risk and high-stress occupations.
“A mentally healthy workplace is not only a legal responsibility; it is a strategic advantage that supports productivity, innovation and sustainable value creation.”
INSIGHT 05
Labour Compliance under India’s New Labour Codes
India’s labour reforms consolidate 29 central labour laws into four major Labour Codes. Organisations should proactively review policies, payroll systems, employee records and governance practices to prepare for implementation.
Key Compliance Areas
Code on Wages, 2019
Minimum wages, timely payments, overtime, payroll transparency and wage records. |
Industrial Relations Code, 2020
Employee relations, grievance redressal, termination, retrenchment and trade-union interaction. |
OSH & Working Conditions Code, 2020
Workplace safety, employee welfare, accident records, contractors and migrant workers. |
Code on Social Security, 2020
PF, ESI, gratuity, employee benefits and social-security records. |
Implementation Readiness
Updated HR policies, employee handbooks, monitoring systems, internal audits and management training. |
INSIGHT 06
The Future of Employment: Permanent, Contract or Fixed-Term?
Permanent Employment
Best suited for core roles, critical capabilities, leadership, culture building and long-term value creation.
Contract Employment
Useful for specialised skills, project-based assignments, interim needs and scalable operations.
Fixed-Term Employment
Suitable for time-bound projects, seasonal requirements, policy-driven roles and defined capacity gaps.
What Will Shape the Future?
- Technology and automation.
- Changing workforce expectations.
- Business agility and scalability.
- Regulatory evolution.
- Global competition.
- Employee well-being and meaningful work.
The Way Forward: Adopt the right mix, right fit and right timing while ensuring fairness, transparency, compliance and strong organisational culture.
INSIGHT 07
Wage Restructuring under the New Labour Codes
The Code on Wages, 2019 introduces a uniform definition of “wages” that affects the calculation of PF, gratuity, bonus and overtime. Employers should review existing salary structures for future compliance.
Wages = Basic Pay + Dearness Allowance + Retaining Allowance
Other allowances are subject to the statutory exclusion framework. Any excess beyond the permitted threshold may be added back into wages for applicable calculations.
Impact on Employees
- Potentially higher PF contributions and stronger retirement savings.
- Higher gratuity and statutory benefits.
- Greater transparency in salary components.
- Possible short-term change in take-home pay.
Impact on Employers
- Redesigning salary structures.
- Possible increase in statutory liabilities.
- Payroll and HR-system updates.
- Improved compliance and employee trust.
Key Compliance Areas
- Payment of applicable minimum wages.
- Timely payment of wages.
- Uniform wage definition across establishments.
- No unauthorised deductions.
Editorial & Contributor Panel
- Dinesh Gupta — Co-Founder & Chief Consultant
- CA Kanika Gupta — Chief Executive Officer
- Dr. Wishey Kataria — Senior Consultant
- CS Yogesh Bochiwal — Senior Consultant
- CS Sweety Sharma — Consultant
- CA Meenakshi Seth — Consultant
- Deviyani Kaur — Consultant
- CS Harshita Hatewal — Consultant
About DSB Law Group Pvt. Ltd.
Founded in 1967 by Shri K.M. Gupta, DSB Law Group has evolved from a specialised labour laws and taxation practice into a multidisciplinary legal and business advisory firm.
Under the leadership of Shri Dinesh Gupta, the firm has expanded into corporate law, banking, NBFC, taxation and governance advisory, combining legal precision with strategic insight.
DSB Law Group works with enterprises across sectors to develop scalable, compliant and sustainable growth strategies.
Contact
Ms. Devyani Seth, Executive
Phone: +91 8727913330
Email: info@dsblawgroup.com
Website: www.dsblawgroup.com
Disclaimer: The views expressed are for informational purposes only and do not constitute legal advice or legal documentation.