New Indian Labour Codes – Penalties, Risks & Employer Compliance Guide

Frequently Asked Questions (FAQ) – Labour Law Compliance 2025

The following frequently asked questions address common doubts faced by employers, HR professionals, and compliance officers while implementing labour law requirements in India during 2025.

1. What is the applicability threshold for PF in 2025?

Under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, Provident Fund (PF) registration is mandatory for establishments employing 20 or more employees. Once covered, PF compliance continues even if the employee strength subsequently falls below 20.

Both employer and employee must contribute 12% of basic wages, dearness allowance, and retaining allowance, subject to applicable limits. Employers must ensure timely monthly remittance and filing of Electronic Challan-cum-Return (ECR).

2. What is the applicability threshold for ESI in 2025?

The Employees’ State Insurance Act, 1948 applies to establishments employing 10 or more employees (in notified areas). Employees earning wages up to the prescribed ceiling are mandatorily covered under the ESI scheme.

Employers are responsible for registration, contribution payment, accident reporting, and facilitation of medical and cash benefits for insured employees.

3. How often should PF returns be filed?

PF returns must be filed monthly through the Unified Portal of the EPFO. Employers are required to:

• Generate and upload the Electronic Challan-cum-Return (ECR)
• Remit PF contributions before the statutory due date
• Maintain contribution and inspection records

Delay in filing or payment attracts interest, damages, and may lead to prosecution in serious cases.

4. Is labour law compliance different for each state?

Yes. While central labour laws apply uniformly across India, many compliances such as Shops and Establishments registration, minimum wages, labour welfare fund, professional tax, and holidays are governed by state-specific rules.

Employers must track amendments and notifications issued by the respective State Governments to remain compliant.

5. Are labour codes fully implemented in 2025?

Although all four labour codes have been enacted, full nationwide implementation depends on notification by the Central and State Governments. Employers should proactively align HR policies, wage structures, and compliance systems with the framework of the new labour codes to ensure smooth transition.

6. What are the consequences of labour law non-compliance?

Non-compliance may result in:

• Financial penalties and fines
• Prosecution of directors, managers, or occupiers
• Cancellation or suspension of licenses
• Labour disputes and reputational damage

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Related Compliance Guides (Internal Links)

For a deeper understanding of specific compliance areas, you may refer to the following detailed guides published on our blog:

• New Definition of Wages under the Code on Wages – Practical HR Impact
• Practical Guide to New Labour Codes for HR Professionals
• Employer Obligations under the Social Security Code
• Penalties and Risks under the New Labour Codes

These internal resources help employers understand compliance obligations in greater detail and strengthen statutory readiness.

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Employer Readiness Checklist for 2025

To strengthen compliance maturity, employers should adopt the following best practices:

• Maintain a statutory compliance calendar with monthly, quarterly, and annual deadlines
• Conduct periodic internal labour law audits
• Digitise payroll, attendance, and statutory registers
• Train HR and supervisory staff on legal obligations
• Engage professional advisors for complex compliance matters

A proactive approach to labour law compliance not only avoids penalties but also enhances workplace discipline, employee trust, and organisational credibility.