What are the new changes to gratuity eligibility?

The new labour codes reduce the gratuity eligibility period from five years to one year, allowing more employees to benefit from gratuity payments earlier in their careers. This is aimed at improving financial security for workers, especially those in fixed-term roles.

How do the new labour codes affect employee benefits?

The labour codes enhance employee benefits by improving regulations around provident fund contributions, paid leaves, and social security. This creates a more supportive environment for worker welfare and financial stability.

What should employers do to comply with these changes?

Employers must adjust their compliance strategies, possibly implementing new payroll systems to handle increased gratuity payments. It's essential to maintain accurate records and update company policies to avoid legal issues and ensure smooth adaptation to the new laws.

Law and Government

New Labour Codes Impact on Gratuity Payments and Employee Benefits

ByHuzaifa Zahoor November 25, 2025November 25, 2025

The new labour codes introduced in India have brought significant changes to gratuity calculations and employee benefits. These changes, notably the reduction of the gratuity eligibility period from five years to one year, impact millions of employees across various sectors. This shift aims to enhance worker welfare by providing better financial stability. We explore the details of these changes and their implications for employees and employers alike.