India's labour law landscape changed meaningfully when the four labour codes came into force in late 2025, and OSH Code compliance has since moved from a "someday" item to a "this quarter" item on every HR leader's list. With central rules under the Occupational Safety, Health and Working Conditions Code notified by the Ministry of Labour and Employment in mid-2026, and individual states now rolling out their own versions of these rules, employers across factories, shops, and establishments are being asked to act on requirements that are still taking final shape. This is exactly why OSH Code compliance deserves close attention right now — not because every detail is settled, but because the direction of travel is clear and the compliance window is narrowing.

This article walks through what the OSH Code generally covers, who it applies to, the broad categories of obligations employers should prepare for, and a practical roadmap for getting ready. Throughout, treat this as a planning guide, not legal advice — always verify specifics against your state's official notifications.

Why OSH Code Compliance Matters Right Now

For years, workplace safety and welfare obligations in India were spread across a patchwork of separate central and state laws, each with its own registration process, registers, thresholds, and inspection regime. That fragmentation made compliance confusing, especially for smaller businesses operating across multiple states.

The OSH Code was designed to bring these obligations under one broad umbrella, using more consistent definitions and processes. But "one law" does not mean "one uniform rulebook" — because labour is a subject where both the central government and state governments have rule-making powers, actual on-the-ground compliance will still depend heavily on how each state notifies and operationalizes its own rules.

That is the crux of why this topic is timely. The code is in force, central rules exist as a framework, but the operational details — thresholds, forms, registers, timelines — are being filled in state by state, through 2026 and likely beyond. Employers who wait for "final clarity" risk falling behind; those who start building compliant processes now, with a mindset of adapting as rules firm up, will be in a far stronger position.

What the OSH Code Broadly Consolidates

In general terms, the OSH Code brings together rules relating to occupational safety, occupational health, welfare facilities, and working conditions that were previously addressed through multiple separate laws covering factories, shops and commercial establishments, contract labour, migrant workers, and certain other categories of workplaces and workers.

Rather than think of it as a list of repealed statutes, it is more useful for HR and compliance teams to think of it as an attempt to standardize a few recurring themes across different types of workplaces:

Registration and licensing of establishments
Working hours, rest intervals, and overtime
Health, safety, and welfare facilities at the workplace
Special protections for certain categories of workers, including women and migrant or contract workers
Record-keeping, registers, and reporting obligations
Safety committees and welfare officers for larger establishments

Because the code applies broadly across sectors — not just traditional factories — it is relevant to IT and services companies, retail chains, warehousing operations, and startups with even modest headcounts, not only heavy manufacturing units. This is one of the biggest mindset shifts for many SMBs: OSH Code compliance is not "a factory problem" anymore.

Who Does the OSH Code Apply To

Applicability under the OSH Code generally depends on factors such as the nature of the establishment (factory, shop, commercial establishment, or other categories), the number of workers employed, and in some cases the type of work or hazard profile involved. Certain thresholds that existed under the earlier factories and shops laws are expected to carry forward in spirit, though states may adjust specific numbers when notifying their rules.

Broadly, employers should assume the code is relevant to them if they run:

A factory or manufacturing unit of any meaningful size
A shop, retail outlet, or commercial establishment employing staff beyond a small handful
A warehouse, logistics, or distribution operation
An office-based business (IT, services, BPO) once headcount and working patterns are considered
An establishment that engages contract labour or has workers who migrate from other states

Because thresholds vary by state and by category of establishment, do not assume your business is exempt simply because it does not resemble a traditional factory. Confirm applicability against your specific state's notified rules and your establishment's registration category.

Factory and Shop Safety Rules India: A Quick Reality Check

Many SMB owners still associate "factory and shop safety rules India" with old, siloed laws that applied narrowly. Under the OSH Code framework, the intent is to bring more workplace types under a comparable safety and welfare standard, even if implementation details differ. If you run a shop or commercial establishment and have historically treated safety compliance as someone else's concern, this is the moment to revisit that assumption.

Key Employer Obligations Under the OSH Code

While exact requirements will be defined by your state's notified rules, the OSH Code framework points to a consistent set of obligation categories that employers should prepare to address. Below is a general overview — treat every specific number or requirement as indicative until confirmed against official notifications.

Registration and Licensing

Establishments will generally need to register (or re-register/migrate existing registrations) under the applicable state process. For businesses that already hold registrations under earlier factories or shops and establishments laws, expect some form of transition or migration process rather than starting from zero — but confirm this with your state labour department rather than assuming automatic carryover.

Working Conditions and Working Hours

The OSH Code framework addresses standard working hours, rest intervals, weekly offs, and spread of working hours. Employers should expect continued emphasis on defined daily and weekly hour limits, with overtime treated as a distinct, separately compensated category. Exact hour limits and overtime multipliers should be confirmed against central and state rules rather than assumed from past practice.

Health and Welfare Facilities

Requirements typically span things like clean drinking water, sanitation facilities, first aid, canteens or rest areas (often scaled to establishment size), and crèche facilities where applicable. Larger establishments are generally expected to provide a more extensive set of welfare facilities than smaller ones, so thresholds matter.

Safety Committees

For larger or higher-risk establishments, the code framework anticipates the formation of safety committees with worker representation, intended to give employees a structured channel for raising safety concerns. The size threshold at which this becomes mandatory is expected to be defined at the state or sector level.

Appointment Letters

A notable and very HR-relevant feature of the labour codes generally is a stronger expectation that every employee receives a formal appointment letter. This has direct implications for onboarding processes and HR documentation, discussed further below.

Overtime and Compensation

Where employees work beyond standard hours, the framework anticipates overtime compensation at a differential rate. Payroll teams should expect to need reliable working-hour data to calculate this correctly and defensibly.

Women Working Night Shifts, With Safeguards

The code framework is generally understood to permit women to work night shifts across more categories of establishments than before, subject to safeguards such as consent, transportation, adequate lighting and security arrangements, and other protective measures to be defined in rules. Employers planning to roll out or expand night shifts for women employees should treat the safeguard conditions as a compliance prerequisite, not an afterthought, and should confirm specific safeguard requirements with their state rules before implementation.

Welfare Officer Requirements for Larger Establishments

Establishments above a certain worker count have historically been required to appoint a welfare officer, and the OSH Code framework is expected to continue some version of this requirement. If you are a growing SMB approaching a size threshold, it is worth checking whether a welfare officer appointment is on your near-term horizon.

Annual Health Checks and Safety Audits

Depending on the nature of work and hazard exposure, the framework anticipates periodic health checks for workers and safety audits of the workplace, particularly for higher-risk operations. Even lower-risk office environments may see lighter-touch expectations around ergonomic safety and periodic review.

Record-Keeping and Registers

Perhaps the most operationally intensive obligation for HR and payroll teams is maintaining accurate registers and records — covering attendance, wages, overtime, leave, and safety-related documentation. Historically, inspectors have focused heavily on register accuracy and availability, and there is no reason to expect that focus to diminish under the new framework.

Key OSH Code Focus Areas at a Glance

Focus Area	What It Generally Covers	Primary Owner	HR/Payroll Relevance
Registration & licensing	Establishment registration, renewals, migration from old licenses	Compliance/Admin	Determines applicable obligations
Working hours & overtime	Daily/weekly hour limits, rest intervals, overtime pay	HR & Payroll	Direct payroll calculation impact
Health & welfare facilities	Drinking water, sanitation, first aid, canteens, crèche	Admin/Facilities	Budgeting, vendor management
Safety committees	Worker representation on safety issues (larger establishments)	HR/Safety Officer	Governance and documentation
Appointment letters	Formal written terms of employment for all workers	HR	Onboarding process redesign
Night shift safeguards for women	Consent, transport, security, lighting	HR & Admin	Shift scheduling and policy updates
Welfare officer	Mandatory appointment above certain headcount	HR/Leadership	Org structure planning
Health checks & safety audits	Periodic worker health checks, workplace audits	Admin/Safety	Scheduling, budget, vendor coordination
Record-keeping & registers	Attendance, wage, overtime, leave, safety registers	HR & Payroll	Systems and documentation accuracy

How OSH Code Compliance Connects to HR and Payroll

It is tempting to treat OSH Code compliance as a facilities or legal-team problem. In practice, a large share of the operational burden lands squarely on HR and payroll functions.

Appointment Letters as a Compliance Anchor

A properly issued appointment letter is quickly becoming the anchor document for demonstrating compliant employment terms — hours, wages, leave entitlements, and role details all trace back to it. HR teams should audit whether every current employee, including contract and temporary staff, has a compliant appointment letter on file, and build a process to ensure this happens automatically at onboarding going forward.

Leave and Working Hour Tracking

Accurate leave records and working-hour logs are no longer just good practice — they are the evidentiary backbone of OSH Code compliance. If your working-hour data lives in scattered spreadsheets, manual attendance registers, or inconsistent shift logs, that is a genuine compliance exposure, not just an operational inconvenience.

Overtime Pay Calculations

Overtime compliance depends entirely on knowing, to the hour, when employees clocked in and out, and applying the correct differential rate consistently. Manual overtime calculation is error-prone at any scale beyond a handful of employees, and errors here are exactly the kind of thing that surfaces during an audit or inspection.

Statutory Registers as Payroll By-Products

Many of the registers required under labour law — wage registers, overtime registers, attendance registers — are natural by-products of a well-run payroll and attendance system. Rather than maintaining them as a separate compliance chore, forward-looking HR teams are configuring their systems to generate these records automatically as part of routine payroll processing.

Workplace Safety Compliance Beyond Payroll

While HR and payroll carry much of the record-keeping load, workplace safety compliance also touches facilities management, department heads, and leadership. Safety committee formation, health and welfare facility provisioning, and safety audits require cross-functional coordination that HR should help orchestrate even when it does not own every piece.

A useful way to frame this internally: OSH Code compliance is a shared responsibility, but HR is usually best positioned to be the coordinating function, since it already owns onboarding, attendance, and employee records.

State-Level Variation: Why "Check Your State" Is Not a Cliché

One of the most important things for employers to internalize is that the OSH Code does not automatically create one uniform national rulebook. Central rules provide a framework, but individual states have their own rule-making process, and the pace and specifics of that process vary considerably.

Practical consequences of this variation include:

Different states may set different worker-count thresholds for facilities like crèches, canteens, or welfare officers.
Registration and licensing procedures, forms, and portals may differ by state.
Timelines for compliance and transition periods from old registrations may not be identical across states.
Enforcement priorities and inspection practices may vary by state labour department.

If you operate in a single state, your job is simpler but still requires ongoing monitoring of that state's notifications. If you operate across multiple states — increasingly common even for mid-sized SMBs with remote or hybrid teams — you may need a state-by-state compliance matrix rather than a single national policy.

A Practical Approach to Tracking State Rules

Rather than trying to become an expert in every state's evolving notifications, consider:

Identifying which states you have registered establishments or a meaningful headcount in.
Assigning ownership (internal compliance lead or external consultant) for monitoring each relevant state's labour department notifications.
Building a simple internal tracker noting what has been notified, what is still pending, and what changed from the previous position.
Revisiting this tracker on a fixed cadence (monthly or quarterly) rather than only when a compliance deadline looms.

Common OSH Code Compliance Gaps and Mistakes to Watch For

Even well-intentioned employers tend to stumble on similar issues when adapting to a new compliance framework. Watch for these:

Assuming the OSH Code does not apply because the business is an office or shop rather than a traditional factory.
Treating the code as fully "settled" and building processes around assumed section numbers or thresholds without verifying against official notifications.
Continuing to rely on manual, paper-based attendance and overtime registers that are hard to produce accurately during an inspection.
Failing to issue formal appointment letters to all workers, including contract and temporary staff.
Overlooking welfare officer or safety committee thresholds as the organization grows past earlier headcount levels.
Rolling out women's night shifts without first putting the required safeguards (transport, security, consent processes) in place.
Not distinguishing between central rules and state-specific rules, leading to compliance gaps when a state's requirements diverge from assumptions based on another state.
Delaying compliance planning until a formal deadline is announced, rather than building capability incrementally.
Assuming compliance is a one-time registration event rather than an ongoing documentation and audit-readiness practice.

OSH Code Readiness Roadmap: A Step-by-Step Approach

Given the uncertainty around exact state timelines, the most sensible approach for HR and compliance teams is to build general readiness now, so that specific requirements can be layered on as they are notified. Here is a practical roadmap.

Map your establishments and headcounts. List every location where you employ people, the nature of each establishment (factory, shop, office, warehouse), and current headcount at each. This becomes the foundation for understanding applicability.

Audit existing registrations and licenses. Identify what registrations you currently hold under earlier factories, shops and establishments, or contract labour laws, and note renewal dates and any transition guidance issued by your state.

Review and standardize appointment letters. Ensure every employee — including contract and temporary staff — has a written appointment letter covering role, compensation, hours, and leave entitlements. Fix gaps immediately; this is a low-cost, high-visibility compliance win.

Assess your working-hour and attendance tracking. Determine whether your current system can produce accurate, exportable records of hours worked, overtime, and leave for every employee, on demand. If not, this is a priority fix.

Benchmark welfare facilities against likely thresholds. Even before exact numbers are confirmed, assess whether your current facilities (drinking water, sanitation, first aid, rest areas) look reasonable for your headcount and industry norms.

Identify threshold triggers on your growth trajectory. If you are close to headcounts that might trigger welfare officer or safety committee requirements, plan for this proactively rather than reactively.

Assign a compliance owner and a state-tracking process. Designate someone (internal or an external consultant) responsible for monitoring your specific state's OSH Code rule notifications and updating internal policy accordingly.

Upgrade record-keeping systems. Move away from manual registers where possible, toward systems that generate compliant attendance, wage, and overtime records as a natural part of payroll processing.

Train managers and HR staff on new expectations. Make sure people managers understand changes to working hours, overtime approval, appointment letter issuance, and any new safety reporting channels.

Schedule a periodic compliance review. Given the rolling nature of state notifications, build a recurring (quarterly is reasonable) internal review to reassess your compliance posture as new rules land.

The Role of HRMS and Attendance Software in OSH Code Compliance

A recurring theme across almost every obligation category above is documentation: appointment letters, working hours, overtime, leave, and welfare-related registers. Manually maintaining accurate, audit-ready records across even a modest workforce is genuinely difficult, and it becomes considerably harder as headcount grows or as operations span multiple states with different rules.

This is where a well-configured HRMS and attendance system earns its keep. Rather than treating compliance as a separate manual exercise, digital attendance tracking, automated overtime calculation, and centralized employee documentation let compliance records emerge naturally from everyday HR and payroll operations.

Specifically, a good system should help you:

Generate accurate daily and monthly attendance records automatically, reducing reliance on manual registers.
Calculate overtime correctly and consistently based on actual clock-in and clock-out data.
Store and retrieve appointment letters and other employee documentation centrally, so gaps are easy to spot.
Track leave balances and usage in a way that aligns with statutory entitlements.
Produce exportable reports quickly if a labour inspector or auditor requests documentation.
Flag when headcount at a location approaches thresholds relevant to welfare officer or safety committee requirements.

None of this replaces the need for sound legal judgment about how OSH Code rules apply to your specific business — but it does remove a large share of the operational risk that comes from poor record-keeping, which remains one of the most common reasons employers fall short during inspections.

Budgeting for OSH Code Readiness

Compliance under the OSH Code framework is not purely a documentation exercise — several obligations carry real cost implications that HR and finance teams should plan for rather than discover mid-year.

Facility and Infrastructure Costs

Upgrading drinking water arrangements, sanitation facilities, first aid provisions, rest areas, or crèche facilities to meet likely thresholds can involve one-time capital costs as well as ongoing maintenance expenses. Larger establishments approaching headcount thresholds for these facilities should budget for them proactively rather than treating them as a reactive expense once a state notification lands.

Training and Awareness Costs

Rolling out updated policies on working hours, overtime, appointment letters, and safety reporting channels typically requires manager and employee training. Building a modest training budget into your annual HR plan avoids a scramble when new rules are notified with a short compliance window.

Systems and Documentation Costs

If your current attendance, payroll, or HR systems cannot reliably produce the working-hour, overtime, and leave records discussed earlier in this guide, upgrading or reconfiguring those systems is itself a compliance investment worth budgeting for, rather than an optional technology upgrade.

Communicating OSH Code Changes to Employees

Beyond the compliance mechanics, how you communicate changes to employees matters for trust and smooth adoption, particularly for changes touching working hours, overtime, or night shift arrangements for women.

Be Clear About What Is Changing and Why

Employees are more receptive to policy changes when they understand the broader context — that these adjustments stem from a national update to labour law, not an arbitrary internal decision. A short, plain-language communication explaining the change and its practical effect on their day-to-day work goes a long way.

Create a Channel for Questions

Given that many of these changes are still being finalized at the state level, employees will have questions that HR cannot always answer with full certainty. Rather than avoiding the topic, set up a simple channel — an FAQ document, an HR helpdesk ticket category, or scheduled office hours — where employees can raise questions and receive honest, even if provisional, answers.

Update Onboarding Materials Promptly

As appointment letter templates, leave policies, or working-hour rules change, make sure onboarding materials for new hires are updated in step. Nothing undermines confidence in a compliance program faster than new employees receiving outdated documentation.

Frequently Asked Questions

Is the OSH Code applicable to small businesses and startups, or only large factories?

The OSH Code framework is generally intended to apply across a range of establishment types, including shops, commercial establishments, and offices, not only traditional factories, though specific thresholds and requirements can vary by state and establishment category. Small businesses should not assume they are automatically exempt without checking applicability based on their headcount and establishment type.

Do all states have the same OSH Code rules?

No. Central rules provide a framework, but states are responsible for notifying their own detailed rules, and the pace and specifics of this process differ from state to state. Employers operating in multiple states should expect some variation and track each relevant state's notifications separately.

What should we do if our state has not yet notified its OSH Code rules?

Use the waiting period productively: audit your current compliance posture against earlier factories, shops, and labour laws, fix obvious gaps like missing appointment letters or weak attendance records, and monitor official state labour department communications for updates. Being reasonably prepared under the previous framework generally puts you in a better position to adapt once new rules land.

Are appointment letters legally required for every employee now?

There is a general expectation under the broader labour code framework that all employees, including many categories of contract and temporary workers, should receive formal appointment letters. Exact requirements and enforcement mechanisms should be confirmed against current central and state notifications, since this is an area still being clarified in practice.

How do we know if we need a safety committee or a welfare officer?

These requirements are typically tied to headcount and establishment type thresholds, which are being defined through state-level rules. If your organization is growing, it is worth checking your state's notified thresholds periodically rather than assuming a one-time answer will remain accurate indefinitely.

Can women now work night shifts in our establishment?

The broader framework is generally understood to expand the categories of establishments where women can work night shifts, but this is typically conditioned on safeguards such as consent, safe transportation, adequate lighting, and security measures. Employers should confirm the specific safeguard requirements applicable to their state and establishment type before implementing night shifts for women employees, and treat this as an area requiring careful, documented compliance rather than a simple policy change.

What are the penalties for non-compliance with the OSH Code?

Non-compliance under labour law frameworks generally carries financial and, in some cases, other consequences, but specific penalty amounts and enforcement mechanisms depend on the exact provision, the nature of the violation, and applicable state rules. Rather than relying on general figures, employers should consult official government notifications or a qualified labour law professional for guidance specific to their establishment and state.

Where can we find authoritative, up-to-date information on our state's OSH Code rules?

The most reliable sources are your state labour department's official notifications and circulars, supplemented by guidance from a qualified labour law professional familiar with your industry and state. Given that rules are still being notified and refined across states, this article should be treated as general background rather than a substitute for checking current official sources before making compliance decisions.

Conclusion

OSH Code compliance is not a single event with a fixed finish line — it is an evolving set of obligations that will keep taking shape as states notify their own rules over the coming months. The employers who will handle this transition smoothly are not necessarily the ones who know every detail today, but the ones who build strong foundational habits now: accurate working-hour records, proper appointment letters, clear welfare facility planning, and a disciplined process for tracking state-specific updates.

Getting the fundamentals right — clean attendance data, defensible overtime calculations, and centralized employee documentation — puts you in a strong position no matter how the remaining state rules land. CozyHR is built to help HR and payroll teams manage exactly this kind of groundwork, with tools for tracking attendance, working hours, and overtime, and for keeping compliance documentation organized and audit-ready in one place. If your current systems feel like they would struggle under a genuine compliance review, it may be worth exploring how CozyHR can help you get ahead of the OSH Code transition rather than scrambling once your state's rules are finalized.