Payroll & HR

Labour Codes in Maharashtra: Where Things Stand for SMEs

The four labour codes are in force and central rules are final, but Maharashtra's own rules were still drafts in October 2026. What small employers do now.

Facts checked on 2 November 2026.

India's four labour codes have been in force for almost a year, yet many small employers in Maharashtra still ask the same question: what do I actually have to do? The honest answer is that some rules apply now, and some are waiting for the state to finish its own rules. This guide sets out where things stand, what is firm, what is not, and what a small employer can sensibly do today. It is not legal advice. Please confirm the points with your CA or labour consultant.

The timeline so far

We searched for a final Maharashtra notification on 2 November 2026 and found none. A tracker is a secondary source, and the Gazette is the proof, so check it before you rely on any date here. The same tracker lists the Maharashtra drafts as Code on Wages (Extraordinary No. 46), Industrial Relations (No. 47), Occupational Safety (Nos. 49 and 50) and Social Security (No. 53).

Central rules or state rules?

The Central Rules bind an employer only where the Central Government is the "appropriate Government", plus matters the codes give to the Centre for everyone. For an ordinary private shop, office or small factory in Maharashtra, the State is usually the appropriate Government, so the Central Rules do not simply replace the state rules (KSMG). Business Today made the same point on 21 June 2026: private enterprises under state-level codes are not automatically covered by the Central Rules.

What this means in practice: until Maharashtra finishes its rules, existing registrations, certified standing orders and forms continue, according to the tracker. You are not starting from zero, and you are not in a vacuum either.

What small employers can already act on

Appointment letters

Rule 6 of the Occupational Safety, Health and Working Conditions (Central) Rules, 2026 asks for standard appointment letters with the designation, employment category, wages and allowances, place of work, a broad outline of duties and social security entitlements such as EPFO and ESIC (Business Today). Even if your state rules differ, a written letter with those items is good practice and costs you an hour.

Wage slips and payday

People Matters reported on 21 July 2026 that wages must be paid before the expiry of the seventh day of the following month, and that a wage slip must be given on or before payday, on paper or electronically. The same report says these provisions were not yet operational nationwide and take effect after the Centre and states notify them. Treat the 7th as a target you can plan for, not as a date a Maharashtra inspector can yet enforce.

The 50% wage rule, with an example

The codes define "wages" to include basic pay, dearness allowance and retaining allowance. Certain allowances are left out, but the excluded part is capped at half of total remuneration. Where it exceeds half, the excess is added back to wages. That is the reading in a KS&K analysis, which warns against the popular claim that basic must be exactly 50% of CTC. Commentators differ on this point, and we did not find the Gazette text.

Here is how the added-back reading works. It is an example, not advice.

If PF were worked out on those wages, 12% of Rs 20,000 is Rs 2,400, against Rs 1,440 on a basic of Rs 12,000. The wage ceiling for PF is now Rs 25,000, so the extra cost lands inside the ceiling (EPFO FAQ copy). The same KS&K article also discusses the effect on gratuity, but we have not checked the gratuity or bonus formulas, so we leave them out.

Do not change salary structures only because of this article. Wait for your consultant, and for the state rules, before you rewrite appointment letters.

What to wait on

• The final Maharashtra rules. Draft Code on Wages Rules were published on 28 April 2026 for 45 days of comment (SCC Online).
• Registers and returns under the codes. Forms and the way registers may be kept will come from the final rules.
• New inspection practice. Existing inspectors and forms continue until the state notifies the change.

A status table you can keep

Update this table yourself each January and July, and whenever the Gazette changes.

How software can help, and where it stops

Software helps with records, not with the law. In BecozAI, you keep staff documents, such as a signed appointment letter, with each employee. Attendance, leave and shifts feed salary, and payslips are PDFs that staff can download themselves. PF, ESI, professional tax and TDS can be switched on in the pay run. BecozAI does not write appointment letters, does not calculate the Labour Welfare Fund, and does not make the PF ECR or ESIC upload files. For the Maharashtra specifics, see our Mumbai payroll page and our guide to Maharashtra professional tax.

This guide is information, not advice. Please confirm the points in it with your CA or labour consultant.