The Centre’s newly notified rules under the 4 Labour Codes could open the possibility of a 4-day workweek in certain sectors by allowing flexible distribution of the standard 48-hour weekly work limit.
Under the Code on Wages (Central) Rules, the government has stated that total weekly working hours for employees should not exceed 48 hours. However, employers and workers may now have flexibility in distributing these hours across fewer working days. This could allow employees in some sectors to work longer shifts of up to 12 hours per day and receive up to 3 days off in a week without triggering overtime payments.
For daily wage workers, the standard workday remains capped at 8 hours, after which overtime wages at twice the normal rate will apply.
Industry experts believe the flexibility may benefit sectors such as manufacturing, infrastructure, IT, IT-enabled services, and shared services operations, especially where shift-based or project-driven work models are common. However, sectors dependent on real-time delivery timelines and client servicing may face operational challenges in adopting a 4-day workweek model.
The Centre on Friday officially notified final rules under all 4 Labour Codes, including the Industrial Relations Code, 2020; Code on Wages, 2019; Code on Social Security, 2020; and Occupational Safety, Health and Working Conditions Code, 2020. The move came nearly 6 years after Parliament approved the legislation.
The final framework introduces several new provisions including mandatory appointment letters, clearer overtime guidelines, contributions to worker reskilling funds, and expanded digital compliance requirements.
The rules also tighten the definition of “wages” by specifying excluded salary components, which could impact calculations related to gratuity, provident fund, and overtime payments. Additionally, the framework clarifies rules for fixed-term employees, gratuity eligibility after 1 year of service, and unified employer portal integration.
Under the Social Security Code, the rules also introduce provisions for registration of gig and platform workers, Employees’ State Insurance contributions, nomination procedures, crèche facilities, and broader digital compliance mechanisms. The monthly income ceiling for dependent parents has also been increased from ₹9,000 to ₹14,000.
Experts believe the reforms will increase compliance responsibilities for businesses while also bringing greater consistency and clarity to labour and wage regulations across India.
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