Bharat’s The Code on Wages, 2019 (29 of 2019) – 1st Edition 2026.

Bharat’s The Code on Wages, 2019 (29 of 2019) – 1st Edition 2026.

About The Code on Wages, 2019

The Code on Wages, 2019 (Act No. 29 of 2019) is an Indian labour law that consolidates and amends existing laws related to wages and bonus payments.

The Code received presidential assent on August 8, 2019. The Central Government has appointed November 21, 2025, as the date on which the provisions of the Code came into force, replacing four previous laws.

Key Features and Provisions

The Code on Wages subsumes and replaces four central labour laws:

• The Payment of Wages Act, 1936
• The Minimum Wages Act, 1948
• The Payment of Bonus Act, 1965
• The Equal Remuneration Act, 1976

Major provisions of the Code include:

• Universal Minimum Wages:The Code provides a statutory right to minimum wages for all employees, in both organized and unorganized sectors, which previously was limited to specific “scheduled employments”.
• National Floor Wage:The Central Government is empowered to fix a “floor wage” (a baseline minimum wage) for different geographical areas, and state governments must ensure their minimum wages are not set below this level.
• Timely Payment of Wages:The Code mandates that wages must be paid within specific timeframes depending on the wage period (e.g., daily, weekly, fortnightly, or monthly, with monthly wages due within seven days of the next month). For employees who are terminated or resign, their wages must be settled within two working days.
• Uniform Definition of “Wages”:The Code provides a single, consistent definition of “wages” for all four subsumed acts, which helps in reducing litigation and compliance burden. This definition specifies that allowances cannot exceed 50% of the total remuneration, which can impact the basic pay component and, consequently, social security contributions like Provident Fund (PF) and gratuity.
• Equal Remuneration:It explicitly prohibits gender discrimination (including transgender identity) in matters of wages and recruitment for the same or similar nature of work.
• Overtime Wages:Employees working beyond the normal working day (which cannot exceed 8 hours) are entitled to overtime wages at a rate of at least twice their normal wage rate.
• Payment of Bonus:All eligible employees who have worked for at least 30 days in a financial year are entitled to an annual bonus of at least 8.33% and up to 20% of their wages.
• Deductions:The Code outlines permissible deductions from wages (e.g., fines, absence from duty, accommodation) and limits the total amount of deductions to 50% of the employee’s total wage.
• Increased Limitation Period:The time limit for employees to file claims regarding wages or deductions has been enhanced from the previous 6 months/2 years to three years, providing more time for seeking justice.

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