India

The Insolvency and Bankruptcy Code, 2016 (“Code”) was enacted in 2016 to unify India’s fragmented insolvency framework to ensure a time-bound Corporate Insolvency Resolution Process (“CIRP”). The jurisprudence of the Code since its enactment has been continuously evolving through frequent landmark judgments and regulatory amendment to address the procedural bottlenecks and lacunas in the practical application of the Code. The Lok Sabha on 12 August 2025 introduced the, Insolvency and Bankruptcy Code Amendment Bill, 2025 (“Bill”), which is the most comprehensive and substantial reform proposed since the enactment of the Code in 2016. KEY AMENDMENTS AND THEIR IMPLICATIONS Stricter Enforcement of Statutory Timelines and Removal for Judicial Discretion The Bill casts an obligation upon the Adjudicating Authority to dispose of applications under section 7,9 and 10 of the Code within 14 days failing which reasons for delay are to be recorded in writing. The amended sections mandate admission once (a) the default is established, (b) the application is complete, and (c) no disciplinary proceedings are pending against the proposed Resolution Professional. The judicial discretion of the Adjudicating Authority recognized in “Vidarbha Industries Power Ltd. v. Axis Bank Ltd”[1] has also been neutralised and dispensed with. Appointment of Interim Resolution Professional (Section 10 of the Code) In the case of voluntary application for insolvency under section 10 of the IBC, the Corporate Debtors right to proposes an Interim Resolution Professional (“IRP”) has been removed. The amendments enhances transparency and prevents the backdoor entry of erstwhile promoters or management. Upon admission of the Section 10, Application under the Code, the Adjudicating Authority will seek IBBI’s recommendation for an IRP. Restricted Withdrawal (Section 12A of the Code) Stricter compliances for withdrawal of CIRP applications have been proposed, which would permit withdrawal only after CoC has been constituted, there is a 90% vote of the COC in favour of the withdrawal, and the withdrawal is permitted only up till the first call for resolution plans. Further the Adjudicating Authority would also be required to dispose of such applications within 30 days. Enhanced Supervisory Role of CoC (Section 21) The CoC would be empowered to supervise the liquidation process conducted by the liquidator under Chapter III thereby strengthening creditor oversight. Transfer of assets of Guarantor of Corporate Debtor during process (Section 28A of the Code) Proposes amendment to section 28A of the Code permits Creditors of the Corporate Debtor who have taken possession of guarantors to transfer/sell such assets, and proceeds will form part of the CIRP or liquidation estate. Where the guarantor is also under CIRP/Liquidation or personal insolvency, the COC of the Guarantor must also grant approval (except during liquidation where approval is not needed if the creditor has not relinquished the asset under Section 52.) The sale proceeds shall form part of the corporate insolvency resolution process or the liquidation estate of the Corporate Guarantor Mandatory Minimum Amount for Dissenting Creditors (Section 30) Dissenting financial creditors shall receive an amount not less than the liquidation value or what they would receive under the plan if proceeds were distributed, whichever is lower, as determined under Section 53. This protects dissenting creditors while reinforcing the collective decision-making authority of the CoC, thereby reducing instances of strategic dissent and litigation over payout disputes. Opportunity to Rectify Defects: Two-Stage Approval of Resolution Plan (Section 31 of the Code) The Bill, introduces a proviso to Section 31(1)(a), to establish a dual approval process for the resolution plan. The Adjudicating Authority will (a)first approve the resolution plan for implementation and management of the corporate debtor, enabling it to resume operations as a going concern and (b) lastly within 30 days, a second order will be passed approving the distribution of proceeds to creditors. By separating implementation from distribution, the amendment facilitates quicker revival of the corporate debtor, preserves business value and employment, and minimizes delays and disputes over creditor payouts thereby ensuring a more efficient and timely resolution process. Further, the bill proposes that Adjudicating Authority may before rejecting a Plan, give notice to the CoC to rectify such defects. Avoidance of Preferential and Fraudulent Transactions (Sections 43–49) The look-back period for identifying preferential, undervalued, and extortionate transactions, has been revised to two years or one year from the date of filing, instead of from the date of admission, and to include the period during which a CIRP application is pending. The Bill further empowers creditors to initiate action where the Resolution Professional or Liquidator has failed to take action and the proceedings may continue even after the completion of CIRP, liquidation, or dissolution. Stricter Timelines The Bill mandates stricter timelines with the requirement that the Adjudicating Authority record its reasons for delay in concluding the following: Withdrawal of CIRP: within 30 days Liquidation/Dissolution orders: within 30 days Challenge to CIRP initiation: within 30 days Withdrawal of liquidation: within 14 days Other Key Changes Expanded definition of service provider to include all IBBI-regulated entities. • Extended moratorium under Section 14 to the liquidation stage. • Stricter penalties for frivolous litigation. • Government dues clarified as unsecured under Section 53. • Liquidation to be completed within 180 days, extendable by 90; voluntary liquidation capped at one year. • Interim Moratorium under Sections 96 & 124 not applicable for personal guarantors during resolution and bankruptcy. New Concepts Introduced Creditor-Initiated Insolvency Resolution Process (CIIRP) (Sections 58A–58K) The Bill introduces CIIRP for specified corporate debtors and financial creditors. The process may be initiated jointly by notified financial creditors having a 51% voting consent, after notice to the corporate debtor for 30 days. If uncontested, CIIRP starts with a public announcement. The Board of Directors remains in control under the supervision of the IRP/RP. Moratorium may be sought if approved by 51% creditors. CIIRP shall be completed within 150 days, extendable by 45 days. Failure or non-cooperation may lead to conversion into regular CIRP. Group Insolvency Framework (Section 59A) The Bill introduces the concept of coordinated resolution of multiple interconnected group companies belonging to the same corporate 'group' by allowing joint creditor committees, a common insolvency professional, and joint hearings before a single bench. This prevents duplication and maximizes recovery. Cross-Border Insolvency Framework The Bill introduces a globally aligned cross-border framework that will provide for recognition of foreign insolvency proceedings, cooperation between Indian and foreign courts, and coordinated resolution of multinational group insolvencies, thereby enhancing investor confidence. III. Concerns and Challenges Litigation Risks under CIIRP CIIRP, despite its aim of avoiding delay, may result in litigation regarding default verification, creditor documentation, and oversight. In the absence of detailed rules, this can become highly contentious. Rigidity in Withdrawal Rules Limiting withdrawal to post-CoC stage may discourage early settlements, undermining the Code’s objective of negotiated resolution where disputes can be resolved without formal proceedings. Uncertainty in Two-Stage Approval of Resolution Plant The second stage of approval of Resolution Plant for distribution may lead to fresh rounds of litigation, regulatory delays, and prolonged recovery especially for operational creditors. Mandatory Admission of Sections 7 & 9 Applications May Incentivise Malicious Filings Compulsory admission upon proof of default eliminates judicial discretion and, therefore, may motivate creditors to utilize insolvency for debt recovery purposes. Ambitious Timelines and Capacity Issues The proposed timelines of 14 days for admission and 180 days for liquidation may not be feasible due to the prevalent backlog with the Adjudicating Authority and shortage of qualified insolvency professionals. The Insolvency and Bankruptcy Code (Amendment) Bill, 2025 is a significant step toward a faster and more transparent, and globally aligned insolvency regime. By introducing CIIRP, group insolvency, and cross-border frameworks, it modernizes the Code and reinforces creditor empowerment. However, effective implementation will require detailed rules, institutional strengthening, and calibrated judicial oversight to prevent misuse and ensure that the reforms achieve their intended impact. [1] 2022 SCC OnLine SC 841

The Government of India has operationalized the Digital Personal Data Protection Act, 2023 (“Act”), through the notification of the Digital Personal Data Protection Rules, 2025 (“Rules”) on November 13, 2025. Together, the Act and the Rules have created India’s first privacy legislative text that confers new rights to citizens, such as the right to revoke consent for processing personal data, the right to correct and erase personal data and right to redressal against grievances relating to misuse of personal data. In this Article, we aim to provide a comprehensive breakdown of the newly notified Rules and explain its implementation. The Rules outlay a pragmatic, phased implementation schedule that gives institutions time to build governance capacity before the full-scale compliance begins. Nonetheless this period does not lessen the gravity of the forthcoming obligations and timely commencement of compliance preparations shall be determinative in preventing future lapses. THREE PHASED IMPLEMENTATION The Rules and the provisions of the Act are to be implemented in three phases, with the initial phase being effective immediately, the second phase to commence in twelve (12) months and the final phase commencing eighteen (18) months post notification. It is important to note that the first phase, which is now in effect is focused entirely on the establishment of the Data Protection Board (“Board”), the State’s adjudicatory machinery under the Act. This initial phase establishes the Board's structure, its composition, authority, and the appointment processes for its chairperson, members, officers, and staff. The next phase of enactment begins in November 2026, when the provisions relating to the registration of Consent Managers comes into force. Finally, the 18-month timeline, ending in May 2027, is the final and most crucial phase, activating all remaining provisions of the Act including the obligations relating to reasonable security safeguards, privacy notices, breach reporting, data erasure, and verifiable parental consent. CLICKWRAP TO CONSCIOUS CONSENT: One of the key requirements under Rule 3 mandates that data privacy notices be “presented and be understandable independently of any other information”, signalling the end of ‘clickwrap’ prompts where crucial terms are buried within lengthy privacy policies, which are accepted comprehensively by Data Principals through a single “I Accept” checkbox. Notices must instead now use clear and plain language with itemized descriptions of the personal data to be processed, the specific purpose linked to specific goods or services and explicitly address mechanisms for Data Principals to withdraw consent, exercise rights or file complaints with the Board. This itemized requirement forces businesses to abandon vague justifications like “improving our services”. This operates in the benefit of Data Principals and triggers substantial implementation work for Fiduciaries, spanning legal redrafting, UI/UX redesign and the development or modernisation of consent management mechanisms. MANDATORY SAFEGUARDS AND THE 72-HOUR BREACH REPORTING CLOCK: By mandating “reasonable security safeguards”, Rule 6 transforms the internal IT security measures from a voluntary best practice into a binding legal requirement. In particular, all Data Fiduciaries must implement, at a minimum, appropriate data security measures such as encryption, obfuscation, masking or the use of virtual tokens, while taking measures to effectively control access to the physical computer resources. Data Fiduciaries are required to retain access logs for a period of one year, which will necessitate corresponding investments in storage infrastructure and audit capabilities. Rule 7 operationalizes the most high-pressure obligation with a detailed, two-part breach reporting mechanism: (a) one with respect to notifying Data Principals and (b) with respect to notifying the Board. In the event of a personal data breach, Fiduciaries must notify the affected Data Principals without delay in clear language, outlining consequences and mitigation steps. Simultaneously, a report must be filed with the Board, which is further divided into two steps. An initial breach intimation must be sent without delay, followed by a detailed report within 72 hours starting from the point of becoming aware of the breach. This detailed report requires a comprehensive breakdown of the events, root causes and any findings regarding the perpetrators of the breach. This creates a unique dual clock scenario where legal and technical teams must meet this reporting standard while simultaneously complying with the existing 6-hour CERT-In mandate requiring the same incident to be reported through two separate disclosures. VERIFIABLE CONSENT FOR VULNERABLE PRINCIPALS: Rule 10 clarifies the mechanism for obtaining “verifiable parental consent”. It requires that before collecting or processing personal data of a child, the Data Fiduciary must ensure that the parent approves such collection and processing on the basis of reliable verification of the child’s identity and age. Reliable identity details may be retrieved from data already held by the Data Fiduciary or can be voluntarily provided through virtual tokens like Aadhaar Virtual ID and authenticated via digital locker services like DigiLocker. This establishes a de facto technical standard for parental verification tied directly into the India Stack ecosystem. While innovative, this presents significant integration challenges, particularly for non-Indian entities who must build entirely new workflows to accommodate these authentication requirements. These conditions are however subject to certain legitimate exemptions under Rule 12 and the Fourth Schedule to the Rules. Similar obligations are placed with respect to the data of persons with disability under Rule 11, wherein the Data Fiduciary must verify the guardianship status requiring the ingestion and verification of legal guardianship documents. SIGNIFICANT DATA FIDUCIARIES, ALGORITHMS, AND THE SUNSET CLAUSE: Rule 13 sets a higher burden for Significant Data Fiduciaries (“SDFs”). Going beyond Data Protection Impact Assessments (“DPIAs”), cross-border transfer restrictions and independent audits, the Rules also add the requirement to verify that any "algorithmic software" employed by SDFs do not pose risks to user rights. This effective inclusion of a continual algorithmic audit forces SDFs to scrutinize artificial intelligence and automated decision-making systems for possible bias or harm to Data Principals. These systems introduce an additional layer of complexity which grants Data Principals the right to access, correct, erase and nominate. SDFs must now ensure that the algorithmic systems they employ can also operationally support such user rights. Rule 14 also operationalizes the grievance redressal right by mandating Fiduciaries to establish an accessible 90-day grievance redressal system, which must be statutorily followed before a complaint may be escalated to the Board. This encourages companies to resolve most issues internally, thereby preventing the Board from being burdened with simple or frivolous complaints at the first instance. Further, Rule 8 provides for the data retention limits, mandating that data must be erased once its deemed purpose is served. CONCLUSION With a hard deadline of May 2027 set, the notification of the Rules signals a reset for India’s digital economy and the prevailing business logic that taught to capture as much data as possible, even if for undefined future use. The DPDP regime fundamentally inverts that model, replacing infinite data hoarding with a system based on purpose limitations and mandatory erasures. While the 18-month implementation window may appear generous, it practically offers little cushion for businesses that have not already begun reorienting their data handling practices. The operational overhaul from re-engineering user interfaces to integrating India Stack mechanisms, demands both institutional unlearning and substantial new infrastructure. Businesses may now have to dismantle legacy systems built on implicit consent and rebuild them around the strict architecture of privacy-by-design, a transition that requires more than just IT upgrades. With the Rules relying on qualitative thresholds like 'reasonable security safeguards' and 'demonstrable consent,' compliance under this new regime ultimately demands both robust engineering and strategic legal guidance that can navigate ambiguities and ensure technical implementations withstand regulatory scrutiny.

Introduction: In a recent judgement, the High Court of Karnataka (High Court), in Deputy Director, Directorate of Enforcement v. Asadullah Khan & Others[1], examined the intersection between the Prevention of Money Laundering Act, 2002 (PMLA) and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI). The Appeals filed under Section 42 of the PMLA, assailed an order of the Appellate Tribunal, PMLA whereby attachment orders passed by the ED were set aside. The ruling of the High Court provides crucial clarity on the rights of secured creditors and the scope of attachment under the PMLA, particularly when bank funds, not illicit proceeds, form the source of property acquisition. The main issue was whether properties mortgaged to a bank, which had itself suffered losses due to fraudulent loan disbursals, could be subjected to attachment under the PMLA & consequently, whether the immovable properties mortgaged to a bank as a security for loans, could be treated as “proceeds of crime” under Section 2(u) of the PMLA. Brief facts of the case: The Central Bureau of Investigation (CBI) initiated a criminal investigation in 2009, against the officials of the Syndicate Bank and certain borrowers for offences under Section 120B, 409, 420, 467 and 471 of the Indian Penal Code and under Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 (PC Act). The allegations related to irregular sanctioning of loans in violation of banking norms, causing a loss of over Rs. 12,63,65,120/- to the Bank. Based on the predicate offence, the Enforcement Directorate registered a case under the PMLA and provisionally attached seven properties mortgaged to the Bank as security. The Appellate Tribunal (PMLA), New Delhi, by order dated 18.09.2017, set aside the attachment, holding that the mortgaged properties were not proceeds of crime. The ED thereafter preferred four Miscellaneous Second Appeals before the Karnataka High Court under Section 42 of the PMLA. Background about ‘Proceeds of Crime’ (PoC): The concept of “PoC” is central to PMLA. Under Section 2(1)(u) of PMLA, it refers to any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence. Section 5(1) of the PMLA empowers the ED to attach such properties and Section 8 of the PMLA prescribes the adjudication process, requiring the Adjudicating Authority to issue notice to the persons claiming interest in the property. Pertinently, the provisos to Section 8(1) and 8(2) mandate that any person holding interest in the attached property must heard before the confirmation of attachment. On the other hand, under the SARFAESI Act, a secured creditor, is empowered under Sections 13(2) and 13(4) to enforce its security interest without the intervention of courts. The statute ensures priority of repayment of debts out of secured assets. Both PMLA & SARFAESI aim to protect the financial system, by preventing money laundering, and by enabling recovery of legitimate loans, respectively. The High Court made it clear that the properties mortgaged as security for the loans were part of legitimate banking transactions and were not acquired out of any PoC. Even though the securities were insufficient to cover the losses, they did not qualify as “PoC” under Section 2(u) of PMLA. Therefore, ED had no authority to treat these mortgaged assets as tainted property or to confiscate them under the Act. The PMLA targets property derived from tainted sources, not property obtained from lawful funds that are misused later. Where the origin of money is traceable to legal banking channels, such as loans from regulated financial institutions, the property created therefrom does not lose its legitimate character unless it can be shown that the loan itself was obtained as part of the criminal conspiracy. This distinction becomes particularly significant in situations where loans were sanctioned in an improper manner, even though the money advanced came from the bank’s legitimate resources. Findings of the Court: The High Court held that the mortgaged properties could not be treated as PoC since the loans advanced by the Bank were sourced from legitimate funds of the Bank. The Court emphasised that the Bank was the victim of the fraud perpetrated by its officials and borrowers and not a participant in the criminal conspiracy. Therefore, the assets mortgaged to it could not be said to have been “derived or obtained” from any criminal activity. The Court further noted that the Adjudicating Authority had failed to comply with the mandatory requirement of issuing notice to the Bank, despite being aware that the properties in question were mortgaged to it. This omission according to the Court violated the principles of natural justice as well as the express provisions of the PMLA. Further, the Court observed that allowing attachment to continue would effectively defeat the Bank’s right as a secured creditor to recover dues under the SARFAESI Act. The purpose of the PMLA is to trace and confiscate illicit proceeds, not to impede lawful recovery of public funds. Since the Bank had already taken possession of the properties and initiated SARFAESI proceedings, the ED’s attachment could not override those rights. A similar view was taken by the Delhi High Court in The Deputy Director, Directorate of Enforcement v. Axis Bank & Ors[2]. The Court made it clear that properties acquired through ordinary banking channels cannot be labelled as “proceeds of crime” merely because the borrower or certain bank officials later faced allegations in a scheduled offence. It also emphasised that the rights of secured creditors under the SARFAESI Act cannot be pushed aside by an attachment under the PMLA unless there is a definite and proven connection between the attached property and the alleged criminal activity. This approach mirrors the position adopted in the present case, reinforcing the principle that assets funded through legitimate loans remain lawful unless the loan itself is shown to be part of the wrongdoing. Accordingly, the Court held that the Appellate Tribunal’s order confirming the order of Adjudicating Authority was legally sound. The appeals filed by the ED were accordingly, dismissed. Conclusion: According to the authors the High court has rightly found the balance between the powers of the enforcement authorities and the rights of financial institutions. The law (PMLA) serves a national purpose, but it must be restricted to (a) property intricately connected with crime and or (b) property which is acquired by PoC. To extend coverage to any assets acquired with the benefit of any credit transaction would stretch the definition of the term "proceeds of crime" too far and erode public confidence in the banking system. The reasoning of the Court was that in such cases the banks, who are trustees of public money and are victims of cheating in their credit business, should not be penalized especially when that have proceeded to recover their dues under the SARFAESI Act. This decision will reinforce the principle that anti-money laundering tools should be used proportionately, fairly and with respect for the letter and spirit of the statutory framework. The judgment is a step further in the articulation of the idea that justice in financial crime is not achieved by the widest use of power, but by its most disciplined and reasoned application. Authors: Mr. Ishwar Ahuja (Partner) Shilpa Gireesha (Associate) [1] MSA No. 78, 87, 88, 89 of 2020 [2] (2019) 3 SC C 571

The Ministry of Labour and Employment, Government of India (“Ministry”) pursuant to the press release dated 21 November 2025 (“Press Release”) has implemented 4 (four) labour codes, namely, (i) the Code on Wages, 2019 (“Wage Code”), (ii) the Industrial Relations Code, 2020 (“Industrial Relations Code”), (iii) the Code on Social Security, 2020 (“Social Security Code”), and (iv) the Occupational Safety, Health and Working Conditions Code, 2020 (“Health and Safety Code”) (collectively “Labour Codes”) with immediate effect. As per the Press Release, the Labour Codes are intended to keep pace with changing economic realities, evolving forms of employment and are aimed at reducing the compliance burden on both workers and industry thereby improving overall ease of doing business in India. In this Part I of the labour law series of Nota Bene, we have discussed few key changes proposed by the Labour Codes and provided few practical tips for corporates to take note of. Keep an eye out for our upcoming publications in this series, discussing the nuances and inter-disciplinary impact of the Labour Codes in detail. Status of Old Labour Laws The Labour Codes are part of the Concurrent List of the Constitution of India, which allows both the Central and the State Governments to legislate on the employment matters. The Labour Codes have replaced all 29 existing labour laws (except the Employees Provident Fund and Miscellaneous Provisions Act, 1952) (“Old Labour Laws”) as set forth in Annexure with effect from 21 November 2025. However, the Ministry and / or State Governments are yet to notify rules / regulations under the Labour Codes. The Ministry in the Press Release has clarified that during the transition, relevant provisions of the Old Labour Laws and their respective rules, notifications, etc. will continue to remain in force. Therefore, prima facie it appears that the applicable provisions of Old Labour Laws and rules / regulations thereunder will continue to apply. We expect the Ministry will issue further clarification to help the industry participants to navigate migration to the Labour Codes. Critical Changes Introduced by Labour Codes Standardisation of Definition of Wages: The Labour Codes introduce a uniform and wider definition of wages to ensure consistency in calculating salaries, social security, and other benefits. The definition of wages now prescribes a ceiling of 50% on exclusions, i.e. if the specified exclusions exceed the ceiling, such components will then be included in the wages for computation of relevant social security benefits. Hence, companies will now have to rework their salary structures to comply with the statutory “wage” definition. Gratuity for Fixed Term Employee: The fixed term employment (“FTE”) was introduced through Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018 which stated that the FTE will be eligible for all statutory benefits available to a permanent workman on a proportionate basis. However, amendments to the Payment of Gratuity Act, 1972 (Gratuity Act) were not hitherto notified. Now, the Social Security Code has repealed the Gratuity Act and mandated that all FTE(s) will be eligible for gratuity if they complete 1 (one) year of continuous service. Therefore, employers will now have to start provisioning for gratuity of FTE(s) in case they have FTE on the payrolls. Increased Coverage for Minimum Wage: In the earlier regime, minimum wages were notified by state governments region-wise and applied only to scheduled employments. Under the Wage Code, minimum wages will now not just apply to scheduled employment but to all sectors – whether organised or unorganised. A new concept of floor wage (i.e baseline wage) has been introduced which will be notified by the Central Government. Hence, once the notification is released, employers in all sectors will have to conduct internal review and ensure that their salary structure is aligned with minimum wages requirements. Strict Timeframes for Payment of Salaries and Full and Final Settlement: Earlier the applicability of time period for payment of wages was limited to ‘workers’ in factories and specified establishments covered under the Payment of Wages Act, 1936 (“PWA”). Further, such payment time period differed on the basis of number of workers engaged. Now, under the Wage Code, the coverage has been widened, thereby mandating all employers to pay wages to their employee within the 7th day of every month, irrespective of the size of the establishment. Further, where an employee is removed/ dismissed from service/ retrenched/ resigned, the wages payable to him shall be paid within 2 (two) working days of his cessation of employment. Hence, organisations, irrespective of sector have to update their payroll management systems to ensure that not only salaries are paid on time but full and final settlement is also undertaken within 2 (two) working days to avoid any potential disputes and implications of non-compliance. Engagement of Contract Labours: The Health and Safety Code expressly prohibits engagement of contract workers in core activities, i.e., any activity for which the establishment is set up or any activity which is essential or necessary to such activity. Earlier, pursuant to Section 10 of the Contract Labour (Regulation and Abolition) Act, 1970, the state governments had the discretion to notify areas where employment of contract labour was prohibited. States like Andhra Pradesh and Telangana had notified list of such core areas. However, this has now been incorporated in the Wage Code itself, thereby providing a pan-India coverage. Therefore, internal checks have to be conducted to align workforce between core and no-core activities of the company to ensure that contractual workers are not engaged in core activities. Revised Threshold for Applicability of Retrenchment Provisions: Under the Industrial Relations Code the threshold for applicability of retrenchment and layoff provisions has been revised. In the erstwhile Industrial Disputes Act, 1947 (“ID Act”), industries covered under Chapter VB (i.e employing more than 100 workers) required prior approval of appropriate government for undertaking retrenchment or layoff. This threshold for provisions of Chapter VB of ID Act (which corresponds to Chapter X of the Industrial Relations Code) has been revised instead of leaving it up to the discretion of the States. Hence, industrial establishments employing up to 300 (three hundred) workers are now exempt from seeking prior government approval for retrenchment or closure of establishment. Increased Coverage for Employees State Insurance: Earlier, applicability of employees’ state insurance (ESI) was limited to the areas where the scheme was notified by the appropriate government, i.e. notified areas. The concept of notified areas has been removed now, and all the sectors, across India, will have to contribute to employees’ state insurance corporation for eligible employees. Companies will have to do a quick internal check to determine if they are complying with ESI provisions or if they were not falling in notified areas under the erstwhile regime. If they were outside the purview of ESI till now, they will now have to commence compliance with registering their establishment and making prescribed contributions. Miscellaneous Changes In addition to certain critical pointers enumerated above, the Labour Codes introduce a host of other reforms to enhance labour reform while balancing ease of compliance. Find below a list of quick to-dos of other changes for the internal teams: Issue appointment letter(s) to all employees Arrange health check-up Maintain records and registers electronically In case of retrenchment, contribute prescribed amounts to re-skilling fund Migrate to the updated formats for registers, notices and returns as all the Labour Codes have consolidated multiplicity of registers, notices and returns Apart from the above, the Labour Codes also introduce several other changes, overhaul the sector specific framework for bidi workers, plantation workers, etc as well as introduce, for the first time, gig-workers. We will have to await the necessary rules, regulations and schemes to examine how the provisions span out over the coming months. Concluding Remarks The implementation of the four new Labour Codes marks a pivotal shift in India’s employment law framework, aligning it with contemporary business realities. For corporates, this transition presents both an opportunity and a responsibility—an opportunity to streamline compliance and redesign workforce strategies for greater efficiency, and a responsibility to ensure transparent and equitable employment practices. Therefore, an immediate need is for employers to undertake structured internal checks and “gap assessments” to identify misalignments between existing operations, and the new code requirements. Simultaneously, structured training for HR, line managers and supervisors on the Labour Codes needs to be rolled out focusing on practical scenarios such as overtime approval, payroll management, disciplinary action and restructuring. For multinational corporates, this would mean harmonising the Labour Code compliances with global policies while ring‑fencing India‑specific stricter requirements. Therefore, by proactively reviewing documentation, auditing payroll and benefits, and updating HR and compliance processes, organizations can mitigate enforcement and litigation risks and build a more transparent, legally robust workforce framework. Authored by Parag Bhide and Subarna Saha