India’s Labour Laws and Overwork Culture

January 14, 2025

India’s labour laws, designed to protect workers, often fall short in practice. Despite regulations capping working hours at 48 per week, many employees face extensive overtime without proper compensation. The ongoing dialogue about workers’ rights is particularly relevant as India observes National Youth Day on January 12. This page explores the current landscape of labour laws, the culture of overwork, and the challenges in enforcing regulations.

The Culture of Overwork

A survey by Indeed revealed alarming statistics about the Indian workforce. Approximately 88% of employees receive work communications outside regular hours. Moreover, 85% reported being contacted during public holidays or sick leave. This constant connectivity encourages a culture where employees feel pressured to respond, fearing negative impacts on their careers. The situation is dire, with 79% of workers believing that not engaging after hours could hinder their career progression.

Overview of Labour Laws in India

Indian labour laws, including the Factories Act of 1948, aim to protect workers’ rights. The Act stipulates a maximum of 48 working hours per week and mandates rest intervals and paid leave for eligible employees. Additionally, laws like the Minimum Wages Act and the Maternity Benefit Act provide further safeguards. However, despite these regulations, enforcement remains weak, leaving many workers vulnerable to exploitation.

Challenges in Enforcement

Enforcement of labour laws is often lax, particularly in the informal sector, where many workers lack basic protections. The rise of multinational corporations and outsourcing has complicated the landscape, as third-party contractors may not adhere to fair pay practices. Consequently, millions of employees endure poor working conditions and insufficient support, exacerbating the issue of overwork.

New Labour Codes – A Double-Edged Sword

In 2020, India introduced four new labour codes aimed at modernising the workforce. These codes offer more flexibility for employers, allowing for 12-hour workdays in exchange for a four-day workweek, provided the weekly limit is maintained. However, the implementation of these codes has faced delays, leaving many workers uncertain about their rights. Critics argue that these changes could further erode existing protections.

Are Employees Entitled to Overtime Pay?

Under the Shops and Establishments Act, employees in certain states are entitled to overtime pay for hours worked beyond the weekly limit. For example, in Maharashtra and Telangana, overtime is compensated at double the regular wage. However, many white-collar employees are excluded from these protections, as their roles or salaries often disqualify them. Consequently, company policies dictate overtime pay, which can lead to exploitation.

SN Subrahmanyan is the Chairman of Larsen & Toubro.
The Factories Act was enacted in 1948 to protect workers’ rights.
India ranks high in deaths linked to overtime work.
The Minimum Wages Act aims to prevent worker exploitation.
New labour codes were introduced in 2020 for regulatory reform.

The Future of Workers’ Rights

The ongoing discourse around India’s labour laws and the culture of overwork indicates a critical need for reform and better enforcement. Workers continue to face challenges in securing their rights, particularly in an evolving economic landscape. The balance between corporate demands and employee well-being remains a central issue in the conversation about the future of work in India.

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