Code on Social Security, 2020: Expanded Worker Benefits
The Code on Social Security, 2020 brings together nine separate laws into one consolidated framework. It aims to universalise social protection so that every worker, regardless of the sector or type of employment, receives access to essential benefits. The earlier system was scattered across different Acts governing provident fund, insurance, maternity benefits, gratuity and compensation. The new Code creates a unified and inclusive approach that recognises the changing nature of work in India. It is one of the most significant welfare-driven reforms in the country’s labour law landscape.
A Unified System of Social Protection
The Code merges the Employees’ Provident Funds Act, Employees’ State Insurance Act, Maternity Benefit Act, Employees’ Compensation Act, Payment of Gratuity Act, Cine Workers Welfare Fund Act, Building and Construction Workers Acts and the Unorganised Workers’ Social Security Act into a single law. The intention is to simplify implementation, ensure uniform definitions and expand coverage for different categories of workers. It clearly sets out the objective of extending social security not only to traditional employees but also to unorganised workers, gig workers and platform workers.
Provident Fund and Insurance Benefits
The Code carries forward the provident fund and pension system that workers are familiar with but places it under a centralised and better organised framework. Establishments covered under the Act must continue to contribute to PF, and the government retains the authority to define wage ceilings and conditions of applicability. The Employees’ State Insurance scheme also continues, providing medical benefits to workers and their dependants where the establishment meets the required threshold. These schemes remain the foundation of India’s social protection system, now integrated into one coherent statute.
Gratuity for Fixed Term Employees
A major reform under the Code is the provision allowing fixed term employees to receive gratuity after one year of service. Under the earlier law, gratuity required five years of continuous service, which left many workers engaged in project-based, contractual or seasonal work without any benefit. The new provision recognises the growth of fixed term employment and ensures that short employment cycles do not deprive workers of this essential entitlement. It strengthens fairness and aligns benefits with the reality of modern work arrangements.
Maternity Benefits and Protection for Women Workers
The Code incorporates the maternity benefit system that ensures paid maternity leave, nursing breaks and protection from dismissal during maternity-related absence. These provisions reflect the protections of the earlier Maternity Benefit Act, now placed within the larger social security framework. The Code ensures that women workers continue to receive comprehensive support during pregnancy and after childbirth, reinforcing workplace equality and safety.
Compensation for Workplace Injuries
The Code retains the framework of the previous Employees’ Compensation Act, which provides financial security to workers who suffer injuries arising out of and in the course of employment. It ensures that dependants of workers who die due to work-related injuries receive compensation and that workers who suffer permanent or temporary disability are adequately supported. By incorporating this law into the broader Code, the government has created a single point of reference for workplace-related compensation claims.
Recognition of Gig and Platform Workers
One of the most progressive and forward-looking features of the Code is the formal recognition of gig and platform workers. These workers participate outside traditional employer–employee arrangements, often working through digital platforms or flexible contracts. The Code introduces provisions for specific welfare schemes and lays out a structure for contributions from aggregators and the government. This is an important acknowledgment that India’s workforce has evolved and that social protection needs to extend beyond conventional employment.
Support for Unorganised Workers
The Code creates a framework for welfare schemes for unorganised workers, including those related to old-age protection, life and disability cover, health and maternity assistance and skill development. It also provides for the registration of unorganised, gig and platform workers through a centralised portal, which will help link workers to available schemes. By emphasising portability of benefits across states, the Code addresses long-standing issues faced by migrant and mobile workers.
Why the Social Security Code Matters
The Code on Social Security creates a single, comprehensive system that protects workers throughout their working lives. It ensures that employees receive PF, insurance, maternity benefits and gratuity under one consistent approach. It extends protections to millions of workers who were earlier excluded, especially those in unorganised or platform-based roles. It also simplifies compliance for employers who previously had to follow several different laws with varying definitions and requirements. By modernising the country’s social protection system, the Code moves India towards a more inclusive and predictable safety net for its workforce.
What Comes Next in the Series
The next part of this series will explore the Occupational Safety, Health and Working Conditions Code, 2020. It consolidates laws relating to workplace safety, working hours, night shift permissions and welfare facilities. The upcoming article will focus on how the new Code affects workplace safety standards, responsibilities of employers and the rights of workers, including women employed in night shifts. The aim is to continue explaining each labour code in clear, practical language so workers can understand how these changes affect their daily working lives.
