Industrial Relations Code (Amendment) Bill, 2026 Passed by Parliament

Parliament has passed the Industrial Relations Code (Amendment) Bill, 2026. This bill aims to clarify the ambiguity surrounding the repeal of previous labor laws after the implementation of the Industrial Relations Code, 2020. According to the government, this amendment will address practical difficulties in the interpretation and implementation of industrial laws.

Other Related Information

¨     This bill to amend the Industrial Relations Code, 2020 was introduced on February 11, 2026.

¨     The Lok Sabha and Rajya Sabha passed the Industrial Relations Code (Amendment) Bill, 2026 on February 12, 2026.

¨     This bill clarifies that the three previous Acts replaced by the Industrial Relations Code, 2020 will be deemed repealed from November 21, 2025.

¨     The government states that the amendment aims to prevent future legal complications related to the repeal provisions.

Key Provisions of the Amendment

¨     The Bill replaces Section 104(1) of the Industrial Relations Code, 2020.

¨     Section 104(1) of the Industrial Relations Code, 2020 outlines the repeal and saving provisions, which specified that the Central Government may notify the repeal of the Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946, and the Industrial Disputes Act, 1947.

¨     The amendment clarifies that the repeal took effect by 'commission of law' from the date notified under Section 1(3) of the IR Code (i.e., November 21, 2025), and not through executive delegation.

¨     It also eliminates the possibility of confusion that the power of repeal was vested in the executive.

Industrial Relations Code, 2020

¨     This is a major labor law reform that consolidates and replaces the following three central laws:

¨     The Trade Unions Act, 1926: which dealt with the registration and recognition of trade unions.

¨     The Industrial Employment (Standing Orders) Act, 1946: which regulated the conditions of employment in industrial establishments.

¨     The Industrial Disputes Act, 1947: which governed the investigation and settlement of industrial disputes.

Key Features of the Industrial Relations Code, 2020

Expansion of Definitions

¨     Worker: To ensure that more workers have access to basic labor rights, an inclusive definition of 'worker' has been introduced. The definition of worker now explicitly includes sales promotion employees, working journalists, and supervisory staff earning up to ₹18,000 per month.

¨     Strike: Its definition has been expanded to include “mass casual leave” taken by 50% or more of the workers on a single day.

¨     Fixed-Term Employment (FTE): It formally introduces time-bound contracts where workers are entitled to the same wages and benefits as permanent employees, including pro-rata gratuity after one year of service.

Higher Compliance Thresholds

¨     Standing Orders: Only establishments with 300 or more workers (increased from 100) are required to prepare formal standing orders governing the terms of employment.

¨     Layoffs and Retrenchments: Establishments with 300 or more workers are now required to obtain prior permission from the government for layoffs, retrenchments, or closures.

Trade Union Recognition

¨     It provides for a “Negotiating Union” or “Negotiating Council.” A union with 51% membership gains sole bargaining rights; if no union achieves this, a council is formed consisting of unions with at least 20% membership.

Worker Re-Skilling Fund

¨     A new requirement for employers to contribute an amount equivalent to 15 days' wages for each retrenched worker to help them upgrade their skills for future employment.

Dispute Resolution

  •      Two-member industrial tribunals (one judicial and one administrative member) will be established in place of single-member tribunals.

  •      A 60-day notice period for strikes and lockouts has now been made mandatory in all industries, including public utilities.