Employee Rights in India — Labour Laws Guide

8 min read Updated 13 Jun 2026 Indian Law

Indian labour law is governed by multiple legislations including the Industrial Disputes Act, Shops & Establishments Acts (state-wise), Payment of Gratuity Act, Maternity Benefit Act, POSH Act, and the new Labour Codes (yet to be fully implemented). Here are your core rights as an employee.

Right Against Wrongful Termination

For employees covered under the Industrial Disputes Act, 1947, a company with 100+ workers cannot retrench (lay off) employees without prior government permission. For others, termination must follow the terms of the employment contract. Termination without proper notice or cause can be challenged as wrongful termination.

Provident Fund (PF) Rights

Mandatory for companies with 20+ employees
Employee contributes 12% of basic salary; employer matches it
Employer must register you within 30 days of joining
You can transfer PF when changing jobs via the EPFO portal
You can withdraw PF on resignation after 2+ months of unemployment
Employer failing to deposit PF contributions is a criminal offence

Gratuity Rights

You are entitled to gratuity under the Payment of Gratuity Act, 1972 after completing 5 years of continuous service. Calculated as 15 days salary for each completed year of service. Maximum gratuity is ₹20 lakh (for most employees). Payable on resignation, retirement, death, or disablement.

Maternity Benefits

Under the Maternity Benefit Act, 1961 (amended 2017):

26 weeks paid maternity leave for first two children
12 weeks for third child onwards
12 weeks for adoptive mothers (child under 3 months)
Applicable to establishments with 10+ employees
Cannot be terminated during maternity leave
Crèche facility mandatory for establishments with 50+ employees

Protection Against Workplace Harassment (POSH)

The Sexual Harassment of Women at Workplace Act, 2013 (POSH) protects women from sexual harassment. Every establishment with 10+ employees must have an Internal Complaints Committee (ICC). File a complaint with the ICC within 3 months of the incident. You can also approach the Local Complaints Committee (LCC) if there is no ICC.

Retaliation against an employee who files a POSH complaint is itself an offence. The employer is required to maintain confidentiality of the complainant.

Notice Period and Full and Final Settlement

Your employment contract specifies the notice period (usually 1–3 months). The employer must pay all dues — salary, pending leaves, expense reimbursements, and bonuses — in the Full and Final (F&F) settlement. Delays beyond 30–45 days can be challenged.

How to File a Labour Complaint

First send a written complaint to your HR/management
File online at the Shram Suvidha Portal (shramdaan.gov.in) for central act violations
Approach the Labour Commissioner office in your district for state act violations
File a case before the Labour Court for wrongful termination/PF disputes
For PF-specific complaints, approach the EPFO regional office

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Frequently Asked Questions

Can I be fired without notice?

Generally no. Your employment contract specifies the notice period. Even without a contract, the Shops & Establishments Act of your state provides minimum notice periods (usually 30 days for employees with 1+ year of service). Immediate termination requires payment in lieu of notice.

What if my employer is not depositing my PF?

File a complaint with the EPFO regional office or on the Shram Suvidha Portal. Non-deposit of PF contributions is a criminal offence under the EPF Act — the employer can be penalised and prosecuted.

Am I entitled to a salary hike every year?

Not automatically under law. Most employment contracts have provisions for annual performance reviews. However, there is no statutory right to a minimum annual increment (except for employees covered by specific industry settlements or DA revisions).

Can I claim overtime pay?

Yes, under the Factories Act and Shops & Establishments Acts. Overtime is typically paid at twice the regular hourly rate. Many private sector employees are denied overtime pay — file a complaint with the Labour Commissioner.

What is a non-compete clause and is it enforceable?

Non-compete clauses that restrict employment after leaving a job are generally not enforceable in India under Section 27 of the Indian Contract Act. However, clauses protecting trade secrets and client lists may have limited enforceability.