Industrial Relations Code, 2020

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Industrial Relations Code, 2020 consolidates and amends the laws relating to Trade Unions, conditions of employment in industrial establishment or undertaking, investigation and settlement of industrial disputes. The code combines and simplifies 3 Central Labour Laws – The Trade Unions Act, 1926, The Industrial Employment (Standing Orders) Act,1946 and The Industrial Disputes Act, 1947.

The legislation provides for a broader framework to protect the rights of workers to form unions, to minimise the friction between the employers and workers and to provide provisions for investigation and settlement of industrial disputes.

Key Highlights

  • Provision for Gratuity has been made for ‘Fixed Term Employee’ if employee render service under the contract for a period of one year.
  • The code provides that the fixed term employee will get all (Social Security) statutory benefits like ESI, EPF, bonus, wages, hours of work, etc at par with regular employees who are doing work of same or similar nature.
  • The termination of the service of a worker as a result of completion of tenure of fixed term employment would not be a retrenchment.
  • Definitions modified  under the code i.e. Industrial Dispute, Railway, Employee, Employer and Industry etc.
  • Trade union to give notice of 14 days before going on strike
  • Arrangement for going to the Tribunal has been made for resolving disputes arising between Trade Unions. 
  • It raises the threshold for the requirement of a standing order from 100 to 300 workers.
  • Efforts made by the Government for quickly resolving disputes of the workers :
  • Introduced provision to refer the matter straight to the Tribunal in case the dispute is not resolved at conciliation stage.
  • Provision for the Worker RE-Skilling fund has been made in the law to re-skill those workers who have been fired from their jobs. Employer to give additional 15 days salary to such employee.
  • Employee of an Industrial raise dispute with the employer within the time limit of only 2 years instead of 3 years.
  • The definition of worker will be based on the basis of wages being drawn by him and Worker/Employees with salary upto Rs 18,000 p.m.
  • Industrial Relations Code Bill allows companies with up to 300 workers to lay off people without the state government’s approval.
  • if over 50% of a company’s workers take concerted casual leave, it will be treated as a strike.
  • A fine of  INR 1,00,000, which may extend upto INR 10,00,000, is leviable on any person who contravenes this provision.


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