India has consolidated 29 central labour laws into four new labour codes: the Code on Wages, 2019; the Industrial Relations Code, 2020; the Code on Social Security, 2020; and the Occupational Safety, Health and Working Conditions Code, 2020. These codes aim to simplify the complex labour regulatory framework, promote ease of doing business, and extend social security benefits to a wider section of workers. Their impact on both formal and informal labour is significant and multifaceted.

Key Provisions and Aims:

• Code on Wages: Universalizes minimum wages, ensures timely payment, and addresses gender discrimination in wages.
• Industrial Relations Code: Introduces provisions for fixed-term employment, raises the threshold for government permission for retrenchment/closure (from 100 to 300 workers), and mandates a re-skilling fund for retrenched workers.
• Code on Social Security: Aims to extend social security benefits (like provident fund, ESI, gratuity) to gig workers, platform workers, and workers in the unorganized sector.
• OSH Code: Focuses on safety, health, and working conditions for all workers, including contract labourers and inter-state migrant workers.

Impact on Formal Labour:

• Positive: Simplification of laws can lead to better compliance by employers, potentially reducing litigation. Fixed-term employment offers flexibility for both employers and employees. The universal minimum wage could benefit lower-paid formal sector workers.
• Concerns: The increased threshold for retrenchment/closure without government permission (from 100 to 300 workers) is a major concern for trade unions, as it could make it easier for larger establishments to lay off workers, potentially weakening worker bargaining power and job security. This might lead to a 'hire and fire' culture, making formal employment more precarious.

Impact on Informal Labour:

• Positive: The most ambitious aspect is the attempt to bring gig workers, platform workers, and the vast unorganized sector under the social security net. This could potentially provide millions of vulnerable workers with access to health, old age, and other benefits, which they previously lacked. The universal minimum wage could also offer a floor for wages in some informal sectors.
• Challenges/Concerns: The implementation of social security for the informal sector faces immense hurdles. Defining 'employer' for gig/platform workers is complex, and the funding mechanism for these benefits is not entirely clear. Many informal sector workers are transient, making registration and benefit delivery difficult. There are also fears that some formal sector employers might shift towards informal contracts to avoid the stricter regulations and compliance costs associated with formal employment, potentially leading to further informalization.

Overall: The new labour codes represent a significant reform effort with the stated goal of modernizing India's labour laws and extending social protection. While they offer potential benefits in terms of simplification and broader social security coverage, particularly for the informal sector, there are also significant concerns regarding potential erosion of worker rights, particularly in the formal sector, and the practical challenges of implementing comprehensive social security for the vast and diverse informal workforce. The actual impact will largely depend on the specific rules framed under these codes and the effectiveness of their enforcement.