Flexi jobs aligning with labour code’s social security norms: ISF report

What Happened

The Flexi Employment Social Impact Report 2025, released by the Indian Staffing Federation (ISF), found that 82% of flexi workers in India are in assignments lasting more than three months — indicating increasing stability in non-permanent employment arrangements.
The report signals that flexi employment is progressively aligning with the social security provisions embedded in India's four Labour Codes, which came into full force on November 21, 2025.
The alignment is significant because the Labour Codes — particularly the Code on Social Security, 2020 — formally extend EPFO, ESIC, gratuity, and other entitlements to fixed-term employees and platform/gig workers for the first time.
Flexi or contract staffing, long characterised by informality and benefit exclusion, is now being drawn into the formal social security net as employer compliance with the new codes increases.
The ISF report positions this shift as evidence that the Labour Codes' flexible work provisions can co-exist with worker welfare protections — countering concerns that flexi work inherently undermines social security.

Static Topic Bridges

India's Four Labour Codes: A Landmark Consolidation

The Government of India consolidated 44 central labour laws into four Labour Codes, which came into effect in November 2025. The codification simplifies compliance, broadens coverage, and modernises India's labour framework for a changing economy.

Code on Wages, 2019: Defines a universal minimum wage; simplifies payment structures; applies to all workers including unorganised sector
Industrial Relations Code, 2020: Streamlines dispute resolution; introduces fixed-term employment as a standard contract type (with all permanent employee benefits during the term); raises the threshold for retrenchment permission
Code on Social Security, 2020: Extends EPF, ESIC, gratuity, maternity benefits, and accident insurance to gig workers, platform workers, and fixed-term employees — marks the first statutory recognition of gig workers in Indian law
Code on Occupational Safety, Health and Working Conditions (OSHW), 2020: Updates safety standards; extends protections to contract workers and migrant labour

Connection to this news: The ISF finding that 82% of flexi workers have assignments over 3 months is directly relevant to the Industrial Relations Code's fixed-term employment provisions — workers in such longer assignments are now entitled to the same social security benefits as permanent employees under the new codes.

The Employees' Provident Fund Organisation (EPFO) and the Employees' State Insurance Corporation (ESIC) are the twin pillars of India's formal-sector social security. Their extension to flexi and gig workers under the Labour Codes represents a significant expansion of coverage.

EPFO: Established under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952; administers the Employees' Provident Fund (EPF), Employees' Pension Scheme (EPS, 1995), and Employees' Deposit Linked Insurance (EDLI)
Employer contribution: 12% of basic wages; Employee contribution: 12% of basic wages
Over 300 million accounts; one of the world's largest social security organisations
ESIC: Established under the Employees' State Insurance Act, 1948; provides medical care, sickness benefits, maternity benefits, disablement benefits, and dependants' benefits
Applicable to establishments with 10+ employees earning up to ₹21,000/month
Under the Code on Social Security, 2020: Aggregators (platform companies) must contribute 1–5% welfare cess for gig and platform workers into a Central Social Security Fund

Connection to this news: The ISF report's finding that flexi workers are stabilising in longer assignments means more of them will meet the qualifying conditions (minimum wages, minimum employment periods) to access EPFO and ESIC benefits — the report's optimism about social security alignment is grounded in this structural shift.

India has over 7.7 million gig workers (NITI Aayog estimate, 2022), projected to reach 23.5 million by 2029–30. Until the Labour Codes, these workers had no statutory social security entitlements, despite generating substantial economic value for platform companies.

Gig workers are formally recognised in the Code on Social Security, 2020 — the first time in Indian law
The Code mandates a Central Social Security Fund for gig and platform workers, covering life and disability insurance, accident insurance, health and maternity benefits, old age protection, and crèche facilities
Platform companies (aggregators) are responsible for contributing to the fund (1–5% welfare cess), shifting social security responsibility to employers rather than leaving it entirely to workers or the state
Categories formally notified under the codes include IT/ITES workers, audio-visual and digital-media workers, in addition to traditional gig categories

Connection to this news: The ISF report on flexi employment aligning with Labour Code norms reflects a broader convergence: flexi staffing agencies (which employ workers formally and place them with client companies) and gig platforms (which classify workers as independent contractors) are both moving toward Labour Code compliance, driven by regulatory pressure and worker expectations.

Fixed-Term Employment: Flexibility with Worker Protection

The Industrial Relations Code, 2020 introduces fixed-term employment as a legally recognised and standardised contract type. Fixed-term employees — who work for a defined period specified in their contract — are entitled to the same wages, working hours, social security, and other benefits as permanent employees during their term of employment.

Fixed-term employees are not entitled to notice or compensation in lieu of notice if the contract expires (since the end date is known in advance)
However, if a fixed-term employee serves for one year or more, they are entitled to gratuity on a pro-rata basis — a significant change from the previous law (which required five years of continuous service)
The IR Code also raises the threshold for requiring prior government permission for retrenchment from 100 to 300 workers — intended to make hiring (and releasing) workers easier for medium-sized enterprises
Fixed-term employment is expected to formalise roles that were previously filled through informal contract arrangements, extending social security to workers who were previously excluded

Connection to this news: The ISF report's finding that 82% of flexi workers serve assignments over 3 months maps directly onto fixed-term employment provisions. These workers are increasingly entitled to the full suite of social security benefits — the "alignment" the report describes is the practical effect of the IR Code's fixed-term employment framework taking hold.

Key Facts & Data

ISF Flexi Employment Social Impact Report 2025: 82% of flexi workers in assignments over 3 months
Four Labour Codes effective: November 21, 2025 (consolidating 44 central labour laws)
Code on Social Security, 2020: First statutory recognition of gig and platform workers in Indian law
EPFO: Established 1952; administers EPF, EPS (1995), EDLI; 300 million+ accounts
ESIC: Established 1948; applicable to 10+ employee establishments (workers earning ≤ ₹21,000/month)
Aggregator welfare cess: 1–5% of turnover/payable amount for gig worker social security
Gig workers in India (2022): 7.7 million (NITI Aayog); projected 23.5 million by 2029–30
Fixed-term gratuity: Pro-rata gratuity after 1 year of service (vs. 5 years under old law)
Retrenchment threshold raised: 100 workers → 300 workers (requiring prior government permission)