Employment Corner Bulletin March – April 2025

We welcome you to the March-April 2025 Edition of IndusLaw's Employment Corner Bulletin, where we discuss the key statutory and judicial updates for the period between March and April of 2025. This quarter has brought significant developments in employment legislation and judicial precedents across India. The EPFO has implemented important modifications to its processes, while several states have introduced progressive initiatives, including Tamil Nadu's inclusive employment scheme and comprehensive gig worker protections in Telangana. On the judicial front, the Supreme Court has delivered a landmark decision on jurisdiction clauses in employment contracts, while High Courts across India have clarified critical aspects of worker classification and retrenchment procedures. In this Bulletin, we have dedicated a section to emerging workplace trends, including the delicate balance between business necessities and cultural inclusivity in Indian workplaces, which employers and HR leaders should consider while developing their organisational practices and compliance strategies for the remainder of 2025.

LEGAL UPDATES

CENTRAL

EPFO Relaxes Aadhaar Requirements for Bulk UAN Generation

The Employees' Provident Fund Organisation ("EPFO"), through a notification dated April 25, 2025, has relaxed the Aadhaar requirement for the generation of Universal Account Numbers ("UANs") and crediting of past accumulations in specific scenarios. This change, which aims to streamline the accounting of past accumulations, primarily affects two cases: remittances made by exempted Provident Fund Trusts following surrender or cancellation of exemption, and remittances related to past period contributions resulting from quasi-judicial or recovery proceedings.

To implement this change, EPFO has introduced a software functionality at its field offices that enables bulk generation of UANs based on member IDs and other available member information, allowing for prompt crediting of funds without requiring immediate Aadhaar verification. However, as a safeguard measure, these newly generated UANs will remain frozen until Aadhaar seeding is completed, with no transfer or withdrawal transactions permitted until the Aadhaar seeding requirements are fulfilled.

EPFO limits employer's access to employee's Provident Fund information.

The EPFO has issued a notification dated March 27, 2025, limiting employer's access to employee's past employment details. Effective immediately, employers will now only be able to view the current employment details of their employees in the Employee Provident Fund ("EPF") system. This policy change aims to enhance privacy protection for EPF members by preventing potential misuse of historical employment information. The restriction applies to all past employment records that were previously accessible to current employers.

An important exception has been retained for the Employee Pension Scheme ("EPS")-95. When onboarding new employees who declare previous EPS membership in Form 11, employers will still be able to view the status of such membership. This exception ensures that eligible employees can continue their EPS contributions without interruption when changing jobs.

STATE

Tamil Nadu Launches Inclusive Employment Scheme for Industrial Sector

In a progressive move to promote inclusivity and economic growth, the Tamil Nadu Government has introduced a new scheme dated March 20, 2025. The scheme incentivizes the employment of women, differently-abled individuals with benchmark disabilities, and transgender individuals in the state's industrial sector and is effective from April 1, 2024, till March 31, 2027. This initiative aims to boost job opportunities for marginalized communities and reinforce Tamil Nadu's reputation as an inclusive industrial hub.

The scheme offers the employers engaged in manufacturing activities of a new industrial unit, a payroll subsidy of 10% of the basic wages (as defined under Section 2(b) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952) of eligible employees for 2 years.

This is however subject to certain conditions such as (i) the eligible employers must create at least 500 direct jobs for eligible individuals domiciled in Tamil Nadu, (ii) the payroll subsidy under the scheme shall exclude payments made to key managerial personnel and board members, and (iii) the eligible unit should commence operations within the scheme period.

While the Commissioner of Industries and Commerce will manage the applications for Micro, Small & Medium Enterprises, the Commissioner of Investment Promotion and Facilitation through the State Industries Promotion Corporation of Tamil Nadu Limited will oversee the application, sanctioning, and the disbursement of the subsidy for large industries.

Andhra Pradesh extends the exemptions granted to IT/ITES establishments under the Andhra Pradesh Shops and Establishments Act, 1988

The Government of Andhra Pradesh has issued a notification dated March 25, 2025, exempting IT and ITeS establishments in Andhra Pradesh, from specific compliances under the Andhra Pradesh Shops and Establishments Act, 1988 ("ASEA") for a further period of five years, till March 25, 2030. This five-year exemption relaxes compliance with Section 15 (opening and closing hours), Section 16 (daily and weekly hours of work), Section 21 (special provisions for young persons), Section 23 (special provisions for women), Section 31 (holidays), and Sections 47(1), (2), (3), and (4) (conditions for terminating employee services) of the ASEA.

The exemptions are subject to the following conditions being fulfilled by an employer:

1. Working hours cannot exceed 48 hours per week, with additional hours requiring payment of overtime to employees as per the ASEA.
2. Every employee must be provided with one mandatory weekly day off.
3. For employees working on notified holidays, a compensatory holiday with wages must be provided.
4. Women employees can work night shifts provided adequate security measures and transportation between the workplace and residences are arranged. Establishments must ensure that all transport vehicles are registered under the VAHAN app and that women employees use the security mobile app of the police department. The establishment must also implement comprehensive driver verification systems including background checks and maintenance of detailed records of all transport service providers. Transportation routes must be planned to ensure women employees are neither the first to be picked up nor the last to be dropped off. Special security provisions must be implemented for women employees requiring transportation before 6 AM and after 8 PM.
5. Establishments are permitted to maintain statutory registers in digital format instead of hard copies as part of compliance requirements. All employee returns must be submitted online through designated government platforms established by the Labour Factories and Boilers Department.

While the exemptions encourage business growth, employers must ensure adherence to the conditions to prevent potential revocation of the exemptions by the State Government.

Maharashtra introduces Private Placement Agencies Regulation Bill, 2025

The Government of Maharashtra has introduced the Maharashtra Private Placement Agencies Regulation Bill, 2025 (the "Bill") dated March 26, 2025, aiming to regulate private placement agencies and to protect job seekers from exploitation. The Bill applies to all private placement agencies operating in the state of Maharashtra and includes job placement firms, executive search companies, recruitment process outsourcing agencies, labour contractors providing temporary staffing services, and overseas employment consultants with operations in Maharashtra. The following are the key features of the Bill:

1. All eligible establishments must register with the designated State Authority. The registration is valid for a period of 5 years. Agencies must provide a mandatory security deposit based on their size (INR 2,00,000 for small agencies, INR 5,00,000 for medium, and INR 10,00,000 for large agencies) and disclose all branch offices, operational practices, and fee structures.
2. To protect job seekers, the Bill caps placement fees at 8.5% of the annual compensation for domestic placements and 12% for international placements. Agencies are prohibited from collecting fees before a successful placement and must establish mandatory written contracts with job seekers. A 30-day refund guarantee is required if employment terminates within 90 days due to reasons outside the job seeker's control.
3. The Bill includes special provisions for agencies specializing in Information Technology ("IT") and Information Technology Enabled Services ("ITeS") placements, including a streamlined registration process with expedited approvals, allowance for digital-only operations without physical office requirements, permission to operate multi-state placement networks with single-window clearance, and specialized skill verification protocols for technical positions.
4. The Bill establishes a dedicated Monitoring Committee headed by the Labour Commissioner with powers for inspection and audit of placement agency premises and records. Penalties for violations range from ₹50,000 to ₹5,00,000, with potential suspension or cancellation of registration for repeated offenses. Special provisions exist for agencies handling overseas placements, including additional due diligence requirements.
5. Additional compliance requirements include maintenance of digital records for all placements for a minimum of five years, quarterly reporting to the State Authority on placement activities, implementation of grievance redressal mechanisms with 15-day resolution timelines, and protection of personal data of job seekers as per applicable data protection laws.

Kerala amends the limits of working hours of women under the Factories Act, 1948

The Government of Kerala has issued a notification dated March 27, 2025, under the Factories Act, 1948, regarding employment of women during night shifts. This supersedes the earlier notification dated July 16, 2003, and permits women to work between 6:00 AM and 10:00 PM across 24 industrial sectors including food processing, electronics, textiles, pharmaceuticals, and various manufacturing industries. However, employers must strictly adhere to the following conditions:

1. No woman shall be employed between 10:00 PM and 5:00 AM;
2. Separate dormitory accommodations must be provided for women workers;
3. Free transportation with security personnel is mandatory for women working beyond 7:00 PM;
4. Daily working hours limitations must be followed without exemptions;
5. Shift rotations must be planned in such a way that weekly holidays are granted to workers; and
6. Employers must ensure protection of women workers' dignity and safety while maintaining proper documentation of this exemption in Form-33 (inspection registers).

The Government retains the right to revoke or modify these exemptions without prior notice, and all other provisions of the Factories Act, 1948 and Kerala Factories Rules, 1957 remain applicable to the exempted establishments.

Gurugram issues reminder for ER-I Quarterly Report Submission for the period of January-March 2025.

The Government of Haryana has issued a notification dated April 1, 2025, under the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 ("CNV Act") reminding all establishments located in Gurgaon to submit their ER-I report for the quarter ending March 31, 2025, by April 30, 2025, online through the hrex. gov.in portal after updating their organization's profile. The CNV Act applies to all establishments in the public sector and to establishments in the private sector ordinarily employing more than 25 employees. These establishments must notify the relevant employment exchanges, before filling up any vacancy in the establishment.

Haryana amends the contributions to the labour law fund

The Government of Haryana has amended the Punjab Labour Welfare Fund Act, 1965 ("LWF Act"), via a notification dated March 7,2025, revising the maximum monthly contribution limits to the fund. While the employee contribution in terms of percentage of the wages remains the same at 0.2% of the wages per month, the maximum limit of the contribution has been revised from INR 31 to INR 34 per month. Under the LWF Act, an employer is required to contribute twice the amount contributed by the employee. The employer is required to deduct the employee's contribution from their wages, and deposit the total contribution (i.e., employer's contribution and employee's contribution) to the constituted Welfare Board on or before December 31st for the concerned year, through online mode in favour of the Welfare Commissioner. The amendment is in effect from January 1, 2025.

Telangana State introduced the Draft Telangana Gig and Platform Workers (Registration, Social Security and Welfare) Bill, 2025.

The State of Telangana introduced the draft Telangana Gig and Platform Workers (Registration, Social Security and Welfare) Bill, 2025 ("Draft Bill") on April 14, 2025. The said Draft Bill has been released for public consultation and outlines comprehensive measures for gig workers engaged in sectors such as ride-sharing services, food and grocery delivery services, logistics services, e-market place, content and media services and any other goods and services provider platform.

The key provisions of the Draft Bill include the establishment of the Telangana Gig and Platform Workers Welfare Board, self-registration of gig and platform workers, aggregators/platforms with the registration, income security, social security and welfare fund for gig and platform workers- funded by welfare fund fees, worker contributions to specific schemes, government grants, CSR funds, donations, gifts and other sources, and grievance redressal mechanism. The Draft Bill mandates the aggregators to contribute 1-2% of each transaction's payout to the welfare fund, the aggregator is also mandated to deposit the welfare fund fee at the end of each quarter. All payments are mapped on Welfare Fund Fee Verification System (WFFVS) which is administered by the government to ensure transparency in fee collection and expenditure. If the aggregator. The Draft Bill also mandates the issuance of Unique Identification Number to each worker. The Telangana Government is seeking public feedback on the Draft Bill with the aim to finalise and implement the same by May 1, 2025, coinciding with International Worker's Day.

Developments in Haryana's Gig Worker Welfare initiatives.

1. State-wide e-Shram Registration Drive: The Haryana Labour Department conducted an extensive registration campaign to enrol gig workers, platform-based workers, and other unorganised sector employees into the national e-Shram portal in the month of April. This portal provides workers with a formal identity and access to various social security schemes. The initiative included setting up camps across all districts, offering on-the-spot Aadhar authentication and registration assistance. As a result, over 54 lakh workers were successfully registered.
2. Launch of dedicated gig workers portal: On March 17, 2025, the Chief Minister of Haryana, Nayab Singh Saini, announced the establishment of a dedicated online portal for gig workers. This platform aims to connect gig workers with various government schemes and opportunities, providing them with improved access to social security benefits, financial stability and enhanced working conditions.

Kerala Issues Circular to Protect Security Personnel in Commercial Establishments

The Kerala Government issued a circular on March 10, 2025, requiring employers to comply with Section 21B of the Kerala Shops & Commercial Establishments Act, 1960 ("KSCE Act"), specifically concerning security personnel. The circular mandates that establishments provide security personnel, particularly those stationed outdoors or in open areas, with essential and basic facilities, including seating facilities and drinking water, in order to protect their physical and mental well-being and protect them from harsh weather. Security personnel near highways or exposed areas must also be provided with reflective coats, caps, and goggles. All safety equipment should comply with Bureau of Indian Standards guidelines, especially when there is a risk of bodily injury or exposure to physical or chemical hazards.

Additionally, all shops and commercial establishments must register themselves under the Wage Security Scheme and provide minimum wages, overtime pay, entitled leave, and other employment benefits to these security personnel. Any non-compliance with this directive will result in possible monetary penalties for the employers.