Ensure compliance with the 240-day rule under India’s New Labour Codes
To help HR professionals and consultants verify whether an employee has completed a legally recognized “year of service,” this checklist is structured for use under the Industrial Relations Code, 2020 and Code on Social Security, 2020.
Part 1: The Raw Data (Physical Attendance)
- Total number of days physically present at the workplace or logged in remotely.
- Verification of Aadhaar-linked attendance logs (cross-check with Shram Suvidha Portal).
- Calculation of “Actual Working Days” across the preceding 12 calendar months.
Part 2: The “Deemed Days” (Mandatory Inclusions)
Even if the employee wasn’t physically present, these days must be counted toward the 240-day threshold:
- Weekly Offs & National Holidays: Saturdays, Sundays, and gazetted holidays.
- Paid Leave: Earned Leave (EL), Casual Leave (CL), and other paid leave days.
- Maternity Leave: Up to 26 weeks for eligible female employees (as per current notification).
- Temporary Disablement: Absence due to workplace injury or accident.
- Lay-offs: Days when the employer couldn’t provide work (as per Standing Orders).
These inclusions are supported by Section 25B of the Industrial Disputes Act and Section 66 of the Industrial Relations Code.
Part 3: Compliance Status & Thresholds
- Job Security Check: If total ≥ 240 days, mark employee as “Protected” against retrenchment.
- Gratuity Eligibility (FTE): For Fixed-Term Employees, check if 240 days completed. In 2026, FTEs are eligible for pro-rata gratuity after 1 year, regardless of 5-year tenure.
- Leave Earned: If total ≥ 180 days, ensure annual leave credit under OSH Code, 2020.
- Termination Risk: Flag employees at 230-239 days. Ensure any termination is for documented misconduct-not to avoid statutory benefits. This is a known Unfair Labour Practice.
Expert Insight: In 2026, the Inspector-cum-Facilitator uses data analytics from the Shram Suvidha Portal to flag companies with high attrition just before the 240-day mark. Proactive audits using this checklist help avoid red flags and tribunal exposure.
Disclaimer: This checklist is for educational and administrative purposes only. It does not replace professional legal counsel. Compliance requirements may vary based on specific State Rules notified under the Labour Codes. Always consult a certified Labour Law Consultant or practicing advocate for case-specific advice.