National Labour and Employment Policy 2025: Transforming Labour Governance

INTRODUCTION

In October 2025, the Ministry of Labour & Employment, Government of India, unveiled the draft National Labour and Employment Policy, popularly known as Shram Shakti Niti 2025. This landmark policy represents a transformative milestone in India’s labour governance framework, aiming to shift from a predominantly regulatory and enforcement model to a facilitative, inclusive, and technology-driven ecosystem.

Aligned with the long-term vision of Viksit Bharat @ 2047, Shram Shakti Niti 2025 sets forth a bold agenda that connects worker protection and empowerment with productivity enhancement and economic sustainability. The policy responds to the profound structural shifts in the post-pandemic world of work marked by rapid digitalization, the rise of gig and platform economies, green transitions, and evolving employment patterns. It seeks to integrate social security, occupational health and safety, skills development, and employment facilitation within a unified, interoperable digital architecture to ensure social protection and opportunity for all workers, formal, informal, rural, urban, and gig alike.

A defining feature of the policy is the repositioning of the Ministry of Labour & Employment as a proactive National Employment Facilitator, leveraging digital public infrastructures like the National Career Service platform, enhanced by AI and multilingual access, to create transparent, accessible employment services nationwide. This reflects a commitment to not only safeguard workers’ rights and dignity but simultaneously foster business innovation and competitiveness through easier compliance, formalisation, and responsive governance.

In essence, Shram Shakti Niti 2025 offers a comprehensive blueprint for India’s labour future, one that marries ancient values of work ethics with modern imperatives of digital transformation and sustainable development to make India’s workforce truly future-ready, inclusive, and empowered.

KEY OBJECTIVES AND STRATEGIC PRIORITIES

The policy’s vision is to create a labour ecosystem where every worker enjoys dignity, security, and opportunity, while enterprises can innovate and grow sustainably. It outlines seven interlinked strategic objectives:

Universal Social Security: Integration and portability of social security benefits across sectors and states through a unified digital architecture combining EPFO, ESIC, PM-JAY, e-SHRAM, and state welfare boards.
Occupational Safety and Health: Adoption of modern, risk-based inspections and gender-sensitive safety norms, using AI-enabled monitoring to reduce workplace hazards.
Employment and Future Readiness: Expansion of lifelong learning, upskilling, and green jobs creation to meet demands posed by digitalization and global market shifts.
Women and Youth Empowerment: Increasing female labour force participation, ensuring workplace inclusivity and enhanced protections.
Ease of Compliance and Formalisation: Simplification through single-window systems, self-certifications, and digital returns aimed at reducing regulatory burdens, especially for MSMEs.
Technology and Green Transitions: Promoting sustainable employment aligned with climate goals and leveraging technology for governance.
Convergence and Good Governance: Establishing a unified national labour data architecture and strengthening inter-ministerial coordination, with robust monitoring frameworks and digital transparency.

IMPLEMENTATION ROADMAP

Shram Shakti Niti 2025 envisages a comprehensive and phased implementation approach to ensure systematic reform and effective delivery of its ambitious goals. The rollout is planned over three key phases spanning from 2025 to beyond 2030, with each phase building progressively on the previous one to create a modern, inclusive, and digitally empowered labour ecosystem.

Phase I (2025-2027): Institutional Setup and Foundational Integration: The immediate phase focuses on building the necessary institutional frameworks and integrating existing social security schemes into a unified system. Central to this phase is the development of the Labour Stack, a digital architecture designed to aggregate and harmonize databases from EPFO, ESIC, PM-JAY, e-SHRAM, and various state welfare boards. This aims to deliver universal social security coverage with portability and ease of access for all workers, including those in informal and gig sectors. The ministry will also operationalize its role as the National Employment Facilitator, launching pilot programs for employment facilitation, occupational safety reforms, and digital governance tools
Phase II (2027-2030): Nationwide Rollout and Expansion: The medium-term phase aims to scale up the integrated framework across all states, districts, and sectors. This includes the nationwide deployment of the Universal Social Security Account (hereinafter referred to as “USSA”) to ensure seamless coverage and benefit portability. Employment facilitation networks will be materialized through district-level Employment Facilitation Cells that support job matching, skill training, and entrepreneurship. Concurrently, the policy targets a substantial increase in female labor force participation to 35% by 2030 through inclusive initiatives. Skills development programs will be aligned with evolving market requirements, emphasizing digital and green jobs.

Phase III (Post-2030): Paperless Governance and Policy Evolution: The long-term vision is to foster a paperless, fully digital labour administration system that leverages advanced predictive analytics and artificial intelligence for strategic policy making and enforcement. Continuous policy renewal will be guided by empirical evidence derived from an independent Labour & Employment Policy Evaluation Index, which will benchmark states and districts on performance and innovation. This phase envisions India as a global exemplar of ethical, efficient, and inclusive labour governance powered by strategic partnerships with international organizations such as the ILO, OECD, and G20.

INSTITUTIONAL AND TECHNOLOGICAL INNOVATIONS

The policy positions the Ministry of Labour & Employment as the National Employment Facilitator, developing trusted linkages between workers, employers, and training providers. The National Career Service (hereinafter referred to as “NCS”) is envisioned as India’s Digital Public Infrastructure for Employment, leveraging AI, open APIs, multilingual access, and inclusive digital tools to connect talent across urban and rural India, including MSMEs and informal sectors.

Complementing the National Career Service, the policy envisions the creation of an integrated Labour and Employment Stack, a unified digital infrastructure that brings together worker identities, enterprise registries, skill credentials, and social security databases on a single interoperable platform. This integrated stack will facilitate seamless connectivity between workers, employers, training providers, and regulatory agencies, enabling real-time data sharing and social security portability. Advanced features such as AI-driven job matching, credential verification, and multi-language access will enhance inclusivity and efficiency, especially benefiting workers in remote, rural, and informal sectors. Additionally, the policy proposes a unified digital compliance portal for registrations, licensing, and inspections, reducing paperwork and fostering ease of doing business. Through independent audits and robust data privacy safeguards, these technological innovations aim to build a transparent, accountable, and future-ready labour governance ecosystem.

SOCIAL AND ECONOMIC IMPACT

Shram Shakti Niti 2025 aims to:

Ensure financial sustainability through a Labour Reforms Fund pooling resources from government and private stakeholders.
Facilitate citizen outreach by integrating labour services with digital platforms like UMANG and DigiLocker.
Promote public-private partnerships and evidence-based policy making.
Advance social justice by formalizing informal workers, expanding social security coverage, and fostering ethical labour standards.
Foster financial sustainability through the establishment of a Labour Reforms Fund, pooling resources from both government and private sector for long-term social security financing.
Enable citizen-centric service delivery by linking labour welfare schemes to digital platforms like UMANG and DigiLocker, ensuring ease of access and transparency for workers and employers.
Promote public-private partnerships and evidence-based policymaking to dynamically address labour market challenges and optimize resource allocation.
Advance social justice by formalizing informal workers, expanding universal social security coverage, and promoting ethical labour standards.

CHALLENGES

Regulatory Inertia: Historic fragmentation of labour governance across ministries and states makes coordinated reform difficult.
Implementation Gaps: Limited institutional capacity at state and district levels risks slow and uneven policy delivery.
Digital Divide: Unequal digital access hinders universal adoption of technology-driven schemes among rural and informal workers.
Data Privacy and Security: Balancing digital integration with robust protection of worker data remains a critical challenge.
Formalization Barriers: Large informal workforce and informal employment arrangements complicate registration and social security coverage.
Stakeholder Coordination: Aligning efforts among central, state agencies, social partners, and private sector requires robust mechanisms.
Capacity Building: Labour department officials and entities need continuous training on new digital systems and compliance protocols.
Sustained Funding: Ensuring long-term financial resources to support universal social security and ongoing reform initiatives.

WAY FORWARD

Strengthen Institutional Capacity: Enhance skills, staffing, and resources across all levels of labour governance for effective implementation.
Expand Digital Literacy and Access: Invest in infrastructure and training to bridge digital divides, facilitating technology-enabled service delivery.
Develop Robust Data Governance: Implement privacy-by-design principles, conduct impact assessments, and establish grievance redressal frameworks.
Promote Formalization Incentives: Offer fiscal benefits and streamlined compliance to encourage informal enterprises and workers to formalize.
Establish Multi-Stakeholder Forums: Engage workers, employers, experts, and civil society in continuous policy dialogue and feedback loops.
Leverage Public-Private Partnerships: Collaborate with technology providers, training institutions, and financial services to enhance scheme reach and impact.
Ensure Financial Sustainability: Create dedicated Labour Reforms Funds supplemented by government and private sector contributions.
Monitor, Evaluate, and Adapt: Use real-time data analytics, independent evaluation indices, and outcome-focused reviews to refine policy measures continuously.

AMLEGALS REMARKS

Shram Shakti Niti 2025 represents a transformative shift in India’s labour governance landscape, balancing the imperatives of worker welfare, enterprise growth, and technological innovation. By fostering an inclusive, resilient, and future-ready workforce, it lays the foundation for fulfilling India’s aspiration of becoming a global leader in ethical and sustainable employment by 2047.

This policy marks a decisive step towards modernizing India’s labour ecosystem, emphasizing digital integration, social security for all workers, and sustainability. By fostering a culture of innovation, inclusivity, and continuous learning, Shram Shakti Niti 2025 promises to empower India’s workforce to meet the challenges of the 21st century while contributing to the nation’s broader socio-economic development goals.

For any query, feel free to reach out to mridusha.guha@amlegals.com