Multi-State Labour Code Compliance 2026: Gujarat Rules Notified, Maharashtra Hasn’t — Which Rules Apply to Your Branches?

On 8 May 2026, the Ministry of Labour and Employment notified the Central Rules under all four Labour Codes:

• Code on Wages (Central) Rules, 2026
• Social Security (Central) Rules, 2026
• Industrial Relations (Central) Rules, 2026
• Occupational Safety, Health and Working Conditions (Central) Rules, 2026

These rules took effect from the date of publication in the official gazette – 8 May 2026. But here is the catch: the Central Rules do not apply uniformly to every business in India.

The applicability hinges on a single, critical determination: who is the ‘appropriate Government’ for your establishment? 

For most private sector employers viz. IT, manufacturing, retail, construction, and services; the State Government is the appropriate Government. This means you must look to the rules notified by the state where your establishment operates.

The Codes themselves became law on 21 November 2025. The substantive obligations viz. rights and duties written in the law came into existence on that date. A court will enforce them regardless of whether your state has framed rules. What state rules provide is the procedural mechanics viz. forms, timelines, formats for registers.

The Patchwork Reality: Gujarat vs. Maharashtra

Here is where it gets complicated.

Gujarat has notified final rules under all four Codes. It is the compliance benchmark. Your Gujarat branch must follow the Gujarat state rules.

Maharashtra published draft rules under the Code on Wages on 28 April 2026, but rules under the Industrial Relations Code, Social Security Code, and OSH Code remain in draft or pending stage. Nasscom submitted comments on Maharashtra’s draft rules on 12 June 2026. As of today, Maharashtra has not notified final rules under all four Codes.

Different states at different stages of notification create a compliance nightmare for multi-state employers. The same company faces fully operational new codes in Gujarat, partially operational codes in Karnataka, and the old regime in Maharashtra.

The Answer: Which Rules Apply to Your Company?

The answer depends on which Labour Code we are talking about and the nature of your establishment.

Code on Wages, 2019

For your Gujarat branch: The Gujarat state rules under the Code on Wages apply. Gujarat has notified final rules.

For your Maharashtra branches: Since Maharashtra has not notified final rules, you face a grey area. The substantive provisions of the Code on Wages apply (50% wage rule, minimum wage, timely payment). However, procedural aspects viz. forms, specific filing timelines, register formats may not have operational mechanics yet.

Critical distinction: The ‘appropriate Government’ is determined by the establishment, not the company. If your Gujarat branch is a separate establishment, Gujarat rules apply to that branch. Your Maharashtra branches are separate establishments, and Maharashtra rules (or the absence thereof) apply to them.

Code on Social Security, 2020 -The Game Changer

This is where the answer changes significantly.

The Social Security Code explicitly centralises authority for multi-State establishments. The Central Government is the ‘appropriate Government’ for private organisations with operations in more than one state, regardless of the nature of their operations.

For your company: Since you have branches in Gujarat and Maharashtra (multiple states), the Central Social Security Rules apply to your entire company for social security compliance viz. PF, ESI, gratuity, and other social security obligations.

This is similar to the earlier position under the Gratuity Act. The Central SS Rules provide the operational framework, and they are now in force from 8 May 2026.

Industrial Relations Code, 2020

For most private establishments, the State Government is the appropriate Government for industrial relations matters. However, the Central IR Rules contemplate National Industrial Tribunals for disputes affecting establishments in more than one state.

Your Gujarat branch follows Gujarat IR rules. Your Maharashtra branches follow Maharashtra IR rules (once notified) or operate under the substantive provisions of the IR Code pending state rules.

Occupational Safety, Health and Working Conditions Code, 2020

The State Government remains the appropriate Government for specific establishments such as factories, motor transport undertakings, plantations, newspaper establishments, and beedi and cigar establishments.

For your branches, this means:

• Gujarat branch: Gujarat OSH rules apply.
• Maharashtra branches: Maharashtra OSH rules apply (once notified). Pending notification, you must comply with the substantive provisions of the OSH Code.

The Location Principle vs. The Company Principle

The governing principle is clear: rules apply based on the physical location of the employee and the establishment, not the location of the corporate headquarters.

If your employee works from the Gujarat branch, Gujarat rules apply (for wage and IR matters). If your employee works from a Maharashtra branch, Maharashtra rules apply (or the Central Rules as a fallback, depending on the Code).

Exception: For social security matters, since your company operates in multiple states, the Central Social Security Rules apply across the board.

What This Means for Your Compliance Strategy

1. Social Security: Apply Central SS Rules Company-Wide

Since you have operations in more than one state, the Central Government is the appropriate Government under the SS Code. Your entire company must comply with the Central Social Security Rules, 2026.

2. Wages: Location-Specific

Branch Location	Applicable Rules	Status
Gujarat	Gujarat Code on Wages Rules	Notified-fully applicable
Maharashtra	Maharashtra Code on Wages Rules (or Central Rules as guidance)	Draft published 28 April 2026; final rules awaited

3. Industrial Relations: Location-Specific

Branch Location	Applicable Rules	Status
Gujarat	Gujarat IR Rules	Notified
Maharashtra	Maharashtra IR Rules	Draft/pending

4. OSH: Location-Specific

Branch Location	Applicable Rules	Status
Gujarat	Gujarat OSH Rules	Notified
Maharashtra	Maharashtra OSH Rules	Draft/pending

Core Compliance Checklist for HR and Management [FREE]

Immediate Actions:

1. Audit your establishment classification: Determine whether each branch is a separate ‘establishment’ under each Code. Registration requirements may apply at the branch level.
2. Wage structure audit: Ensure Basic + DA ≥ 50% of gross remuneration for all employees, across all branches. This is a substantive obligation that applies regardless of state rule notification.
3. Social Security compliance: Since you have multi-state operations, implement the Central Social Security Rules, 2026 company-wide. Key provisions include:
   • Gratuity for fixed-term employees after 1 year
   • Universal PF coverage for establishments with 20+ employees
   • Ensure ESIC contributions are correctly remitted; the ESIC fund supports medical and cash benefits for covered employees, with total annual expenditure varying based on coverage and claims
4. Maintain separate compliance trackers: Create state-specific compliance checklists for Gujarat and Maharashtra. Track when Maharashtra notifies final rules.
5. Update employment contracts and appointment letters: Ensure they reflect the new statutory framework, particularly the 50% wage rule and 48-hour exit rule.
6. Monitor state gazette notifications: Subscribe to Gujarat and Maharashtra labour department updates. The compliance landscape is evolving rapidly.
7. Do not assume old exemptions carry forward: Particularly IT/ITES sector exemptions; each state’s new rules must be reviewed independently.

Financial and Operational Risk Analysis

Penalties for Non-Compliance

Violation	Potential Consequence
50% wage rule violation	Wage reclassification for statutory calculations; retrospective liability from November 2025
Failure to register under state rules	Penalties under respective Codes; potential prosecution
Delayed full and final settlement beyond 48 hours	Interest liability; potential penalties under Wage Code
Incorrect appropriate Government determination	Invalid compliance filings; retrospective penalties

The Cost of Getting It Wrong

Retrospective liability is the biggest risk. The substantive provisions of the Codes have been in force since 21 November 2025. If your wage structure violates the 50% rule, you face liability dating back to that date and not from when your state notified rules.

Inconsistent compliance across states invites scrutiny during inspections. Labour inspectors in Gujarat will expect Gujarat rules. Inspectors in Maharashtra will expect compliance with substantive provisions even if procedural rules are pending.

Reputational risk: Non-compliance with social security obligations (which are centralised for multi-state employers) can attract central government enforcement action, not just state-level action.

The Strategic Takeaway

Operate on the ‘highest common denominator’ principle. Where state rules are notified (Gujarat), follow them strictly. Where state rules are pending (Maharashtra), follow the Central Rules as guidance and ensure substantive compliance with all Code provisions.

Treat this as a transition, not a stay. Maharashtra will notify its rules. The question is not if but when. Your compliance infrastructure must be ready to pivot when that notification happens.

Adopt a ‘central policy plus state supplements’ approach. Maintain a uniform national framework for social security (since the SS Code centralises authority for multi-state employers) with state-specific addenda for variations in wages, working hours, and procedures.

Disclaimer: This content is provided for educational and informational purposes only. It is based on available Central and State notifications as of the current date (July 2026) and does not constitute formal legal counsel. Labour law compliance is fact-specific and depends on the precise nature of your establishment, employee classifications, and applicable state rules. The authors and publishers assume no liability for any actions taken or not taken based on this content. You are strongly advised to consult with qualified legal counsel regarding your specific compliance obligations under the Labour Codes and applicable state rules.