The Code on Wages, 2019
Consolidates the law on minimum wages, payment of wages, bonus and equal remuneration into one code — and, most consequentially, gives every one of the four codes a single statutory definition of “wages” that reshapes how PF, gratuity and other benefits are calculated.
In force since 21 November 2025; central rules notified 8 May 2026. State rules are at different stages — check the tracker for your state, because until a state notifies final rules, the rules under the acts below continue transitionally.
What it replaces
- Payment of Wages Act, 1936
- Minimum Wages Act, 1948
- Payment of Bonus Act, 1965
- Equal Remuneration Act, 1976
What changes
- Minimum wages become universal
- The old Minimum Wages Act covered only “scheduled employments”. Under the code, every employee is entitled to a minimum wage, and the central government sets a national floor wage below which no state minimum may fall.
- One definition of “wages”, with a 50% rule
- Specified exclusions — house rent allowance, conveyance, overtime and similar — may not exceed half of total remuneration. Whatever exceeds that cap is added back into “wages”. In practice, at least 50% of pay counts as wages for every statutory calculation, across all four codes.
- Payment discipline
- Time limits for paying wages by category of employment, and total deductions from an employee’s wages capped at 50%.
- Gender-neutral pay
- The Equal Remuneration Act’s guarantee is carried forward: no discrimination on grounds of gender in wages or recruitment for the same work or work of a similar nature.
What it means for compliance
- Salary structures where basic pay is a small slice of CTC need restructuring — the 50% rule pulls allowances into the statutory wage base, which raises PF and gratuity outflows. Our wage-definition calculator models the delta.
- Minimum-wage tracking extends to every employee, not only scheduled employments.
- Wage registers and pay slips follow the Central Rules (Forms I, IV, V and IX of the Code on Wages (Central) Rules, 2026) where the Central Government is the appropriate Government, and the state’s own rules under the code elsewhere.
Sources
- Press Information Bureau / DD News — four Labour Codes in force, 21 November 2025
- DLA Piper — Key considerations of the notified Central Rules (May 2026)
- Lakshmikumaran & Sridharan — state rules status tracker
Compiled from the sources above on 19 August 2026 and pending review by our legal team.
Informational only, not legal advice. Thresholds stated here are the code’s central provisions; your state’s rules may modify them — verify before acting.