BJP MP Anurag Thakur, representing Hamirpur in Himachal Pradesh, on Wednesday, 8 July 2026, highlighted two key worker-welfare provisions from India's reformed labour framework — equal social security benefits for fixed-term employees and a doubling of the statutory gratuity ceiling from Rs 10 lakh to Rs 20 lakh.

In his post, tagged to Hamirpur, Thakur stated: 'Jo bhi Fixed-term employees hain unhe permanent employees ki tarah hi samajik suraksha labh milega' — meaning all fixed-term employees will receive social security benefits on par with permanent employees, and the minimum service period required for gratuity eligibility has been removed for them. He further noted that the gratuity ceiling has been raised from Rs 10 lakh to Rs 20 lakh.

Context

Fixed-term employment contracts allow companies to hire workers for specific durations without the obligations attached to permanent employment. Historically, such workers were excluded from gratuity entitlements because they rarely completed the standard five-year continuous service threshold required under the Payment of Gratuity Act, 1972. This left a large section of the organised and semi-organised workforce without a key retirement-linked benefit.

Thakur's post draws attention to reforms that address this structural gap, positioning fixed-term workers as equal beneficiaries of social security protections that were previously available only to those with long, uninterrupted tenures.

Policy Backdrop

The provisions Thakur referenced are rooted in two distinct legislative actions. The Payment of Gratuity (Amendment) Act, 2018 raised the statutory ceiling on gratuity payouts from Rs 10 lakh to Rs 20 lakh, benefiting all employees covered under the original 1972 Act. This change brought the ceiling in line with the enhanced gratuity limits applicable to central government employees.

Subsequently, the Code on Social Security, 2020 — one of four landmark labour codes passed by Parliament — explicitly extended gratuity entitlements to fixed-term employees on a pro-rata basis, removing the minimum service period requirement for this category. The Code consolidated nine central labour laws into a single framework, also bringing gig workers and platform workers within the ambit of formal social security coverage for the first time.

Stakeholders and Impact

The beneficiaries of these provisions include contract workers, seasonal employees, project-based hires, and others engaged on fixed-term contracts across manufacturing, construction, retail, and the services sector. For these workers, the removal of the minimum service bar means gratuity is now calculated on a pro-rata basis from day one of employment, providing a financial safety net regardless of contract duration.

The doubling of the gratuity ceiling to Rs 20 lakh is particularly significant for mid-to-senior level employees in the private sector, who had seen the earlier cap eroded by inflation over decades. Employers in states that have notified the Code on Social Security, 2020 are required to factor these obligations into their workforce cost planning.

What's Next

The full implementation of the Code on Social Security, 2020 depends on state-level notifications, as labour is a concurrent subject under the Indian Constitution. Himachal Pradesh and several other states are at varying stages of framing rules under the new codes. Until states publish final rules, the older laws technically remain operative in those jurisdictions.

Thakur's communication from Hamirpur signals continued grassroots outreach on labour welfare provisions, a theme that is likely to feature prominently as the ruling party seeks to demonstrate tangible policy delivery to the workforce ahead of future electoral cycles.