May Newsletter

Notifications

Revision of Variable Dearness Allowance for Centrally Scheduled Employments

The Office of the Chief Labour Commissioner (Central), New Delhi, issued a series of orders dated 30 March 2026 revising the rates of Variable Dearness Allowance (VDA) for multiple centrally scheduled employments. The revised rates came into force with effect from 1 April 2026 and have been issued in accordance with Section 69(2) of the Code on Wages, 2019. The revision reflects an increase of 11.28 points in the Consumer Price Index for Industrial Workers (CPI-IW), which rose from 413.52 to 424.80 as on 31 December 2025 (Base Year 2016 = 100). The revised VDA has been rounded off to the next higher rupee, as per the decision of the Minimum Wages Advisory Board.

The revised VDA rates apply across seven broad categories of centrally scheduled employments:

• Mines employment - covering Gypsum, Barytes, Bauxite, Manganese, China Clay, Kyanite, Copper, Magnesite, Stone, Steatite, Ochre, Asbestos, Fire Clay, Chromite, Quartzite, Quartz, Silica, Graphite, Felspar, Laterite, Dolomite, Red Oxide, Wolfram, Iron Ore, Granite, Rock Phosphate, Hematite, Marble, Calcite, Uranium, Mica, Lignite, Gravel, Slate, and Magnetite Mines. Separate rates apply for above-ground and below-ground workers, with total daily wages extending up to approximately ₹1,078 for highly skilled underground workers.

• Construction or maintenance of roads, runways, building operations, and underground cabling work - including laying of electric, wireless, radio, television, telephone, telegraph and overseas communication cables, electric lines, water supply lines and sewerage pipe lines. Revised VDA ranges from ₹206 to ₹401 per day, resulting in total daily wages between ₹556 (unskilled, Area C) and ₹1,094 (highly skilled, Area A).

• Agriculture employment - VDA revised on an area-wise (A, B, and C) and skill-wise basis, ranging from ₹178 to ₹256 per day. Revised minimum daily wages (Basic + VDA) now range from approximately ₹478 for unskilled workers to ₹694 for highly skilled workers in Area A.

• Sweeping and cleaning employment - revised daily VDA and minimum total wage rates notified under F.No. 1/6(1)/2025-LS-II.

• Watch and Ward employment (with and without arms) - separate rates prescribed for armed and unarmed personnel. For armed personnel, VDA ranges from ₹339 to ₹401 per day, with total daily wages reaching ₹1,094 in Area A.

• Stone Mines (treated as a distinct category from other mines) - revised VDA notified for excavation, stone breaking/crushing, and stacking activities under F.No. 1/6(7)/2025-LS-II. Certain piece-rate categories now attract total wages exceeding ₹3,400 per day.

• Loading and unloading in Railways, Docks, and Ports - revised VDA and total minimum wage rates notified separately.

The revised rates continue to apply the three-tier area classification introduced vide notification S.O. 187(E) dated 19 January 2017: Area A (major metropolitan urban agglomerations including Delhi, Mumbai, Bengaluru, Chennai, Kolkata, Lucknow, and others), Area B (other notified urban centres), and Area C (all remaining areas). The instant orders will remain in force until superseded by a corresponding order issued under Section 7(2) of the Code on Wages, 2019.

Haryana - Revision of Minimum Wages Across All Skill Categories

The Government of Haryana issued a gazette notification revising the minimum rates of wages for all employments in the state, effective 1 April 2026. The revision was based on recommendations by an expert committee and was approved by the State Cabinet. Chief Minister Nayab Singh Saini formally announced the hike on 8 April 2026. The revised structure replaces the prior category framework and introduces a simplified four-tier skill classification (Unskilled, Semi-Skilled, Skilled, and Highly Skilled) applicable uniformly across the state without any geographic zone differentiation.

The revised minimum wage rates (Basic + VDA) effective 1 April 2026 are as follows:

• Unskilled workers: ₹15,220.71 per month (₹585.41 per day) - an increase from ₹11,257 per month, representing an approximate 35% hike.

• Semi-Skilled workers: ₹16,780.74 per month (₹645.41 per day).

• Skilled workers: ₹18,500.81 per month (₹711.56 per day).

• Highly Skilled workers: ₹19,425.85 per month (₹747.14 per day).

Key compliance provisions accompanying the notification include:

• Wages must be paid as a whole and cannot be split into multiple allowances to circumvent the statutory floor.

• The notification mandates strict gender pay parity - equal wages for men and women performing the same or similar work.

• Trainees are entitled to 75% of the applicable category wage for their skill level, but in no case less than the unskilled rate. The training period is capped at one year.

• Per-day wages are calculated by dividing monthly wages by 26 days; deductions, however, use 30 days as the base.

• Principal employers bear direct responsibility for ensuring that contractors engaged on their premises also pay minimum wages at the applicable revised rates.

Haryana now sets one of the highest statutory wage floors in India. Employers should note that at the revised Haryana rates, wages for semi-skilled and skilled workers exceed the current EPF wage ceiling of ₹15,000 per month, which may have implications for the voluntary or mandatory nature of provident fund contributions for certain categories of workers.

Karnataka - Revision of Minimum Wages for Shops, Commercial Establishments, and Other Scheduled Employments

The Government of Karnataka released the revised minimum wages for Shops and Commercial Establishments (Scheduled Employment No. 68) vide Notification No. KAE 47 LMW 2017, published on 26 March 2026, effective from 1 April 2026 and valid through 31 March 2027. Revised rates for all other scheduled employments under Karnataka's wage schedule are accessible via the official Karmika Spandana portal. The revision is driven by an update to the State Annual Average Consumer Price Index for Industrial Workers for calendar year 2025, as reported by the Directorate of Economics and Statistics, Government of Karnataka, resulting in an additional Variable Dearness Allowance of ₹435.60 per month for the 2026-27 financial year. Karnataka follows an annual revision cycle, unlike states such as Gujarat which revise semi-annually.

The wage structure is zone-differentiated across four geographic zones, based on population density and urbanisation:

• Zone I: Areas falling under the Bruhat Bengaluru Mahanagara Palike (BBMP) jurisdiction - carries the highest wage rates. For a skilled worker in Zone I, the revised rate is ₹714.25 per day (Basic ₹539.28 + VDA ₹174.97), equivalent to approximately ₹18,570 per month at 26 working days.

• Zone II: All other Municipal Corporation areas in Karnataka (Hubballi-Dharwad, Mangaluru, Mysuru, Belagavi, Kalaburagi, and others). For a skilled worker, the revised rate is approximately ₹688.57 per day (₹17,902 per month).

• Zone III: Town Municipal Council and other notified urban areas - intermediate rates.

• Zone IV: All remaining areas, including gram panchayat jurisdictions - carries the lowest rates within the zone structure.

The revised rates apply across skill categories: Unskilled, Semi-Skilled, Skilled, and Highly Skilled. Illustrative rates for Shops and Commercial Establishments (Zone I) include: Highly Skilled - ₹19,972 per month (Basic ₹15,423 + VDA ₹4,549); Skilled - ₹18,570 per month. Contract workers, security personnel, housekeeping staff, and delivery employees engaged at commercial establishments on a contract basis are equally covered - the principal employer carries arrear liability if contractors pay below notified rates.

Goa - Cancellation of Principal Employer/Contractor Licence; Section 135B Notification

The Government of Goa issued two labour-related notifications on 8 April 2026. The first notification concerns the cancellation of a Principal Employer or contractor licence under the applicable labour law, relevant to establishments engaged in contract labour operations. The second notification was issued under Section 135B of the relevant statute, which typically deals with the representative character and registration of trade unions or matters relating to employment conditions under the applicable representation legislation.

Key points for compliance professionals operating in Goa:

• Establishments engaged in contract labour operations in Goa - as either principal employers or licensed contractors, should verify their registration and licence status is current and compliant with the requirements under the Contract Labour (Regulation and Abolition) Act, 1970 (applicable in transitional form), and review whether the 8 April cancellation affects any related parties within their supply chain or contractor network.

• The Section 135B notification should be reviewed to assess implications for trade union matters, collective bargaining arrangements, or employment condition determinations applicable to Goa-based establishments.

• Establishments should ensure their licence renewals are not outstanding, as the Goa Labour Department has been active in enforcement actions in April 2026.

Judgments

Madan Singh v. The State Of Haryana

In Madan Singh v. State of Haryana, the Hon’ble Supreme Court reaffirmed the settled position that irregular or backdoor appointments cannot be regularised merely on account of long service. The Court held that regularisation is not a mode of recruitment and must conform strictly to the constitutional mandate under Articles 14 and 16.

The case arose from claims by ad hoc employees seeking regularisation on the basis of continued engagement over several years. The petitioners argued that their prolonged service created a legitimate expectation of permanency. However, the State contended that the appointments were made without following due recruitment procedures. Accepting this position, the Court held that any appointment made dehors the rules cannot be legitimised through judicial intervention, regardless of the duration of service rendered.

The ruling reinforces the post-Umadevi jurisprudence, drawing a clear line between equity and legality in public employment. It underscores that continuity of service, by itself, does not confer a right to regularisation, and reiterates the primacy of transparent and merit-based recruitment processes in public employment.

Balaji Madhukar Konkanwar v. Maharashtra State Road Transport Corporation

In Balaji Madhukar Konkanwar v. Maharashtra State Road Transport Corporation, the Hon’ble Supreme Court held that an employee cannot be denied back wages for the period during which the employer failed to comply with binding judicial directions on regularisation. The Court emphasized that once entitlement to regularisation and consequential benefits has attained finality, the employer cannot evade liability through subsequent conditions or delayed compliance.

The case arose from a long-standing dispute where the appellant, initially engaged as a daily wage worker, was illegally terminated and later reinstated pursuant to labour adjudication. The Industrial Court had directed regularisation upon completion of 180 days of service, but the employer failed to implement this order for several years, ultimately regularising the employee only in 2011. The Labour Court subsequently awarded back wages for the intervening period; however, the High Court set aside this relief.

Reversing the High Court’s decision, the Supreme Court held that the employer’s continued non-compliance could not defeat the employee’s accrued rights. It rejected the plea of estoppel based on the employee’s acceptance of later regularisation, noting the unequal bargaining power and prolonged litigation faced by the employee. The Court restored the award of back wages for the relevant period, while reducing the rate of interest from 12% to 8%, thereby reinforcing that judicially recognised service rights cannot be diluted by administrative delay or unilateral employer action.

Kalinga Ray v. UCO Bank

In Kalinga Ray v. UCO Bank, the Hon’ble Orissa High Court addressed the issue of prolonged engagement of employees without formal regularisation, holding that an employer cannot indefinitely continue a worker in a precarious, non-regular capacity despite long and continuous service. The Court emphasised that such arrangements, if allowed to persist, undermine principles of fairness in employment.

The case arose from a claim by a worker who had been engaged over an extended period and was performing duties comparable to regular employees. Despite this, the employer declined to grant regular status, maintaining the employee in a temporary capacity. The Court examined the nature and duration of the engagement, noting that the employee had effectively become an integral part of the workforce.

While stopping short of laying down a blanket rule on regularisation, the Court observed that prolonged and continuous engagement can give rise to a legitimate expectation of fair treatment. It held that employers cannot exploit such arrangements to deny job security indefinitely and must act reasonably in addressing claims for regularisation. The ruling reflects a fact-driven approach, balancing constitutional requirements with the need to prevent unfair labour practices arising from long-term casualisation.

Naresh Kumar vs New Delhi Municipal Council

In Naresh Kumar v. New Delhi Municipal Council, the Hon’ble Delhi High Court examined claims for regularisation raised by workmen engaged on a continuous basis, reiterating that completion of prescribed thresholds of continuous service remains a relevant consideration in labour law, though not determinative of a right to permanency.

The dispute arose from assertions by the workmen that, having performed duties of a regular and perennial nature and completed the requisite period of continuous service, they were entitled to be treated as permanent employees with corresponding benefits. The employees also invoked principles such as equal pay for equal work and alleged unfair labour practices arising from differential treatment despite identical duties.

The Court analysed the statutory framework, including the relevance of Model Standing Orders and established jurisprudence concerning completion of 240 days of service. It observed that while such thresholds may trigger certain statutory protections and rights, they do not, by themselves, confer an automatic right to regularisation in public employment, which must still align with constitutional and procedural requirements.

The ruling reflects a balanced approach, acknowledging the continued relevance of traditional labour law benchmarks, while reaffirming that claims for permanency must be assessed within the broader framework of public employment norms and applicable recruitment rules.

Subhash v. Ministry of Telecommunication

In Subhash v. Ministry of Telecommunication, the Ld. Central Administrative Tribunal examined whether a worker formally classified as part-time could claim benefits of full-time engagement based on the nature of duties actually performed. The Tribunal underscored that employment rights cannot be determined solely by nomenclature where factual conditions indicate otherwise.

The case arose from a claim by a casual labourer who contended that, despite being designated as a part-time worker, he had been consistently engaged for extended hours over several years, effectively discharging full-time responsibilities. The employer resisted the claim, relying on the formal classification of the engagement. The Tribunal therefore undertook a factual assessment, examining the duration of service, nature of duties, and degree of control exercised by the employer.

In its analysis, the Tribunal observed that where the actual working conditions demonstrate sustained, full-time engagement, the employer cannot rely on a nominal classification to deny legitimate benefits. It emphasised that the substance of the employment relationship must prevail over form, particularly in cases involving long-term engagement under employer supervision.

The ruling highlights the recurring issue of worker misclassification and reinforces the evidentiary importance of actual work performed in determining employment status and corresponding entitlements.

Kishan Sharma & Ors. v. Management of MCD

In Kishan Sharma & Ors. v. Management of MCD, the Hon’ble Delhi High Court reaffirmed that the existence of an employer–employee relationship is a foundational prerequisite for grant of relief in labour disputes. The Court held that in the absence of cogent evidence establishing such a relationship, claims for reinstatement and back wages cannot be sustained.

The case arose from claims by workmen seeking reinstatement with consequential benefits, alleging illegal termination. However, the Labour Court found that the claimants had failed to discharge the burden of proving that they were employees of the respondent authority. There was insufficient documentary or oral evidence to substantiate their engagement or demonstrate control and supervision by the employer.

Upholding this finding, the High Court observed that the initial burden lies squarely on the workmen to establish the factum of employment. Only upon such proof does the onus shift to the employer. In the absence of credible evidence, the Court declined to interfere with the Labour Court’s decision denying relief.

The ruling reinforces a settled principle in labour jurisprudence that the threshold issue of employment must be clearly established before any adjudication on termination, reinstatement, or back wages can arise.

Bridge and Roof Company (India) Ltd. v. Assistant Labour Commissioner

In Bridge and Roof Company (India) Ltd. v. Assistant Labour Commissioner, the Hon’ble Calcutta High Court dealt with the issue of delay in filing an appeal under labour legislation, reaffirming that statutory limitation periods must be strictly complied with unless sufficient cause is clearly demonstrated. The Court held that condonation of delay cannot be granted on vague or unsubstantiated grounds.

The case arose from an appeal filed beyond the prescribed limitation period, where the appellant sought condonation citing internal administrative lapses. The Court examined the explanation offered and found it to be inadequate, noting that no concrete material was placed on record to justify the delay or demonstrate due diligence.

Upholding the rejection of the appeal, the Court observed that limitation provisions are not merely procedural but form an integral part of the statutory scheme, ensuring certainty and finality in adjudication. It emphasised that casual or routine explanations, particularly those based on internal inefficiencies, cannot be accepted as sufficient cause.

The ruling underscores the importance of procedural discipline in labour matters and reinforces that statutory timelines cannot be diluted in the absence of credible and specific justification.

Atish Sambhaji Mohite v. GKN Sinter Metals Pvt. Ltd.

In Atish Sambhaji Mohite v. GKN Sinter Metals Pvt. Ltd., the Hon’ble Bombay High Court considered a batch of industrial dispute petitions involving challenges to termination and related reliefs, reiterating the importance of fact-specific adjudication in labour matters. The Court emphasised that issues of termination must be assessed in light of the evidentiary record and the statutory framework governing industrial disputes.

The case arose from multiple petitions raising overlapping questions of law and fact, which were heard together and decided through a common judgment. The disputes primarily concerned the legality of termination and the reliefs granted by labour adjudicatory authorities. The Court examined the factual matrix in each case alongside the applicable provisions of labour law and the findings of the Labour Court/Industrial Tribunal.

In its analysis, the Court underscored the limited scope of interference in writ jurisdiction, observing that findings of fact by specialised labour forums ought not to be disturbed unless they are perverse or unsupported by evidence. It reiterated that adjudication of industrial disputes requires a careful appreciation of evidence, including the nature of employment, conduct of parties, and compliance with statutory safeguards.

The ruling reinforces the principle that labour disputes, particularly those involving termination, turn on their specific facts and that judicial review must respect the domain and expertise of labour adjudicatory mechanisms.

International Updates

European Union Introduces Platform Work Directive to Reclassify Gig Workers

In April 2026, the European Union formally advanced the implementation of its Platform Work Directive, aimed at reclassifying gig economy workers as employees where control and supervision by digital platforms are established. The Directive introduces a rebuttable presumption of employment, shifting the burden onto platforms to prove that workers are genuinely independent contractors.

The reform addresses long-standing concerns around misclassification in sectors such as ride-hailing, food delivery, and digital services. It also mandates algorithmic transparency, requiring employers to disclose how automated systems impact work allocation, performance evaluation, and termination decisions.

United Kingdom Introduces Joint Liability Framework for PAYE Compliance in Umbrella Company Structures

In April 2026, the United Kingdom introduced a significant reform to its labour and tax compliance framework by implementing joint and several liability rules for PAYE obligations in the umbrella company model. Under the new regime, recruitment agencies, or in their absence, end-clients, may be held directly liable for unpaid income tax and National Insurance contributions if the umbrella company in the supply chain defaults.

The reform addresses long-standing concerns around tax leakage and non-compliance within contractor supply chains. Historically, umbrella companies acted as intermediaries between workers and end-clients, often resulting in fragmented accountability. The new rules eliminate this gap by shifting risk upward in the contractual chain, irrespective of the due diligence conducted by the hiring entity.

The development marks a decisive move towards stricter enforcement in contingent workforce structures. It significantly alters risk allocation for businesses engaging contract labour, compelling organisations to undertake deeper compliance checks and reassess their engagement models.

Canada Strengthens Pay Transparency Laws with Mandatory Disclosure Requirements

Canada expanded its pay transparency regime in April 2026, introducing stricter obligations on employers to disclose salary ranges in job postings and report gender pay gap data.

The reform applies to employers above specified thresholds and aims to eliminate information asymmetry in hiring processes. Companies are required to maintain internal pay audits and submit periodic disclosures to regulatory authorities.

The move reflects growing global pressure to address wage inequality through structural interventions rather than voluntary reporting. It also introduces compliance risks for employers with inconsistent compensation practices across roles or regions.

United Arab Emirates Expands Labour Protections in Free Zones

The UAE expanded labour protections within its free zones in April 2026 by aligning certain employment standards with federal labour law, including provisions relating to termination, notice periods, and dispute resolution.

Historically, free zones operated under distinct regulatory frameworks, often leading to variations in employee protections. The move aims to standardise core employment rights while retaining the commercial flexibility of free zone jurisdictions.

The reform enhances legal certainty for employees and employers operating in these zones and signals a gradual convergence of employment standards across regulatory regimes.

Brazil Strengthens Enforcement Against Misclassification of Independent Contractors

Brazil intensified enforcement actions in April 2026 against companies misclassifying employees as independent contractors to avoid labour obligations.

Labour authorities have increased inspections and imposed penalties in sectors such as logistics, delivery services, and digital platforms. Courts have also shown a greater willingness to reclassify contractual arrangements based on the reality of control and dependency.

The development reflects a broader Latin American trend toward protecting worker rights in informal or semi-formal employment arrangements.

The content provided in this update is for educational and informational purposes only and should not be construed as legal advice or opinion. Lex Alliance, Advocates & Legal Consultants, will not be liable in connection with the use of this information without seeking appropriate legal counsel