After the implementation of new labor codes in India, employees thought that salary hikes would be affected, but according to the latest reports, most companies will continue with their planned increments. In November 2025, 4 new labor codes came into force, due to which the calculation of gratuity, bonus, overtime and leave encashment changed. This has increased employee costs, especially in the IT sector. Still, experts say that the increments will not be too slow, because talent retention is important. The average salary hike in 2026 may be around 9%. The use of automation and AI may increase in the long term, but the chances of salary growth stopping completely are slim.

Earnings season has started in the Indian stock market and the mood of the market seems to be decided with the Q3 results of the IT sector. Labor Codes have emerged as a new challenge for IT companies this quarter. Due to these rules, a total exceptional charge of more than ₹ 4,373 crore has been imposed on Infosys, TCS and HCL Tech. Infosys reported additional expenditure of ₹1,289 crore, TCS ₹2,128 crore and HCL Tech ₹956 crore. Due to the new labor code, the provisions of gratuity and leave liabilities have increased. About ₹1,800 crore was spent on gratuity adjustment in TCS alone. Its impact was visible on margins, where Infosys’ margin fell from 21% to 18.4%, while TCS remained at 25.2%. Rising costs have increased the concern of investors.

On one hand, the new Labor Codes being implemented in India are going to increase the salary, PF, and retirement benefits of the employees, while on the other hand, it will have a direct impact on E-commerce, Food Delivery, and Gig Economy Platforms. Platforms like Swiggy, Zomato, Ola, Uber will now have to contribute 1–2% of the annual turnover or 5% of the total payments made to gig workers to the Social Security Fund to be created by the government. If the maximum 5% contribution is implemented, the additional charge is likely to increase to approximately ₹3.2 on a food delivery order and ₹2.4 on a quick-commerce order. Media reports say that this expense can be passed on the users by increasing Platform Fee, Surge Charges, or Delivery Fee. Although gig workers already get facilities like accident insurance, health insurance, non-payment of wages cover and maternity benefits, their social security coverage will increase further after the new codes. The challenge is that gig workers do not have fixed working hours, change platforms and work on multiple apps simultaneously, which can be operationally difficult to implement. In the video we will understand the complete effect in easy language.

New Labor Codes have been implemented for more than 40 crore employees of the country. This is not just a legal change but a historic change in the lives of workers in India through Labor Rights. The aim of the new laws is to provide a safe, respectful and stable work environment to every worker. According to the new Labor Codes, it is now mandatory for every worker to get minimum wage on time, which will prevent delay, arbitrariness and exploitation. Appointment letter in job has been made mandatory for the youth so that their rights are protected as soon as they start the job. Clear rules of equal pay for women have been implemented, which will reduce gender based discrimination at workplaces. Fixed Term Employees have been given the right to Gratuity after only one year of employment, which is a big relief for Contract Workers. Annual Free Health Check-up has been made mandatory for all workers above 40 years of age, which the government is seeing as an investment in the long-term health of the workforce. Workers doing overtime will now be given double wages, so that they can get the right value for the extra hard work. Also, workers of high-risk sectors like Mines, Chemical, Construction will be provided 100% health security so that their jobs are completely safe. In this video, all the major rights and changes of the New Labor Codes have been explained in simple language.