Retail and Hospitality: Navigating Labour Code 2025 with a Gig-Heavy Workforce

India’s Labour Code 2025 marks a turning point for the retail and hospitality sector. With gig workers now formally recognized under labour laws in India, businesses that rely on delivery partners, temporary store staff, event-based hotel teams, and peak-hour restaurant workers must rethink how they manage scheduling, compliance, and workforce engagement.

For retail and hospitality employers, this isn’t just a legal update—it’s an operational shift. To stay compliant while preserving flexibility, organizations need to act decisively across four critical areas: 

• Identify and classify gig workers across stores, hotels, restaurants, and delivery operations 
• Redesign shift schedules to comply with working hour limits, weekly offs, and overtime payment rules in India 
• Put systems in place to track hours, rest periods, and documentation consistently 
• Strengthen gig worker engagement through clear communication and structured workforce practices 

This blog breaks down: 

• What Labour Code 2025 means specifically for retail and hospitality employers with gig-heavy workforces.  
• Highlights the compliance challenges unique to deskless teams, and;  
• Shares a practical, phased implementation roadmap.  

Finally, it explores how the right workforce engagement approach can help businesses move beyond compliance to build a more reliable and future-ready gig workforce. 

Understanding Labour Code 2025 for retail and hospitality's gig workforce 

The Labour Code 2025 consolidates 29 central labour laws into four comprehensive codes. For retail stores, hotels, and restaurants managing gig workers, two codes are game-changers: the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions (OSH) Code, 2020. 

Who counts as a gig worker in your business? 

Before these reforms, your delivery partners, temporary store staff, and contracted housekeeping teams existed in a legal gray area. That's changed. 

Gig workers now include: 

• Delivery personnel for food and grocery orders 
• Temporary retail staff during sale seasons 
• Event-based hotel staff for conferences and weddings 
• Restaurant servers hired for peak hours 
• Warehouse workers in fulfillment centers 
• Contracted housekeeping and maintenance teams 

According to the Press Information Bureau, gig workers are officially defined as "persons who perform work outside of traditional employer-employee relationships." Platform workers are those working through digital intermediaries—think Swiggy delivery partners or Urban Company service providers. 

What you must provide: Social security basics 

The gig worker labour code introduces mandatory benefits that change how you manage flexible staff. If you operate as an aggregator or hire gig workers regularly, here's what's now required: 

Financial contributions:

• Contribute 1-2% of annual turnover to a Social Security Fund 
• Capped at 5% of total payments made to gig workers 
• Applies to businesses using platform workers or acting as aggregators 

Benefits gig workers now receive:

• Accident insurance coverage 
• Health and maternity benefits 
• Pension scheme access 
• e-Shram registration with portable benefits 
• Grievance redressal mechanisms 

Working hours and shift rules for stores, hotels, and restaurants 

The OSH Code, 2020 sets clear boundaries that directly impact how you schedule staff during busy periods. Whether you're managing a 24/7 hotel, a retail store during Diwali sales, or a restaurant on weekends, these rules apply: 

Maximum working hours:

• 48 hours per week maximum 
• 9 hours per day for continuous shifts 
• Mandatory 30-minute break after 5 hours of work 

Weekly rest requirements:

• One full day off every week (mandatory) 
• If worked, employee gets either: A compensatory day off within the same week, or double pay for that day (overtime payment rules in India) 

What does this mean for your operations?

For retail stores: 

• Plan ahead for festive season staffing needs 
• Can't simply extend everyone's hours during sales 
• Need backup staff for weekly off coverage 

For hotels and restaurants: 

• Weekend and holiday operations require careful rotation 
• 24/7 services need multiple shift teams 
• Peak season planning must account for mandatory rest days 

For delivery and fulfillment: 

• Can't schedule the same riders 7 days a week 
• Need larger pools of gig workers for flexibility 
• Must track cumulative hours across the week 

These regulations don't eliminate flexibility; they just require smarter planning. Organizations that get this right can reduce burnout and improve service quality, even with these constraints. 

The compliance and strategic challenge for retail and hospitality employers 

For retail and hospitality organizations, Labour Code 2025 introduces a dual challenge. On one hand, businesses must ensure strict compliance with updated labour laws in India.

On the other, they must continue operating with speed, flexibility, and cost efficiency, especially when managing large numbers of gig workers across locations and shifts. 

This balance between regulation and agility is where most employers feel the pressure. 

Managing compliance in a high-turnover, gig-heavy environment 

Retail and hospitality workforces are uniquely complex. They are: 

• Highly seasonal, with demand spikes during festivals, sales, and tourist seasons 
• Shift-driven, often operating beyond standard business hours 
• Distributed and deskless, with limited access to traditional HR systems 
• Increasingly gig-based, relying on short-term, on-demand talent 

Labour Code 2025 adds structure to this environment—but also increases the need for precision. Key compliance challenges include: 

1. Tracking and documentation challenges: 

For businesses accustomed to flexible, informal arrangements with gig workers, the new labour laws demand systematic record-keeping: 

• Shift hour tracking: Every hour worked must be logged, not just for payroll but for compliance audits 
• Rest period verification: Proving that 30-minute breaks were provided after 5 hours 
• Weekly off management: Documenting which day each worker took off and compensatory arrangements 
• Overtime calculations: Maintaining records of hours exceeding limits and double-pay disbursements 

According to compliance experts, labour inspectors now have digital audit capabilities, making paper-based or ad-hoc tracking systems inadequate. 

2. Multi-location coordination issues: 

If you operate across multiple cities or states, complexity multiplies: 

• State-wise variations: While codes are central, states issue their own notifications with specific timelines and requirements 
• Currency and language barriers: Benefits and communications must adapt to regional contexts 
• Aggregator vs. direct hire confusion: Different obligations depending on how workers are engaged 

3. The deskless workforce communication gap: 

Here's where retail and hospitality face unique challenges compared to office-based businesses: 

• No corporate email access: Store associates, delivery personnel, and housekeeping staff typically don't have company email addresses 
• Limited smartphone penetration: Not all frontline workers have smartphones with data access 
• Language diversity: Policies must be communicated in multiple regional languages 
• Shift-based schedules: Workers aren't all present at the same time for briefings

4. Financial impact considerations: 

The costs go beyond just social security contributions: 

• Increased payroll for overtime payment rules in India compliance 
• Administrative expenses for tracking and documentation systems 
• Potential penalties for non-compliance (as states activate enforcement) 
• Higher gig worker costs as benefits are factored into total compensation 

When approached strategically, Labour Code 2025 can actually strengthen workforce operations. 

Retail and hospitality employers that adapt early can: 

• Build trust with gig workers through transparent and fair practices 
• Reduce attrition by offering stability within flexible work models 
• Improve workforce predictability during high-demand periods 
• Strengthen employer branding in a crowded labour market

The key lies in implementation, moving from policy interpretation to day-to-day execution. 

That’s where a clear, phased approach becomes critical. Next, we’ll walk through a practical four-phase implementation roadmap tailored for retail and hospitality employers managing gig-heavy workforces. 

Implementation roadmap: A 4-phase practical guide for retail and hospitality employers 

Understanding Labour Code 2025 is only the first step. For retail stores, hotels, restaurants, and delivery-led businesses, the real challenge lies in execution, especially when managing a gig-heavy workforce across multiple locations, shifts, and peak seasons. 

A phased approach helps employers move from interpretation to action without disrupting daily operations. The following four-phase roadmap is designed specifically for retail and hospitality environments where flexibility must coexist with compliance. 

This roadmap helps retail and hospitality employers: 

• Move from policy interpretation to execution without disrupting daily operations 
• Maintain flexibility while staying compliant with evolving labour regulations 
• Build a more predictable, scalable, and engaged gig workforce 

With execution structured and simplified, the next step is enabling this model with the right technology. 

Navigating Labour Code 2025 with the right workforce engagement approach 

Labour Code 2025 makes one thing clear for retail and hospitality employers: compliance cannot succeed in isolation. When businesses rely on large numbers of gig workers—many of whom are deskless, mobile, and shift-based—execution breaks down not because of intent, but because of visibility and engagement gaps. 

To meet the expectations set by evolving labour laws in India, employers need systems that help them communicate, engage, and support gig workers consistently, without adding operational complexity. 

Why traditional HR systems fall short for gig-heavy retail and hospitality teams 

Most HR tools were built for office-based employees with email access, fixed schedules, and stable employment relationships. Retail and hospitality environments look very different. 

Common challenges include: 

• Gig workers and frontline staff without corporate email access 
• Rotational and staggered shifts across outlets and locations 
• Language diversity among delivery, housekeeping, and service staff 
• Limited visibility into engagement and participation across the workforce 

When these gaps exist, even well-designed compliance policies around working hours, weekly offs, or benefits fail in practice. 

This is where a deskless-first workforce engagement layer becomes essential. 

Built in India and designed for Indian workforce realities, Xoxoday takes a technology-first approach to solving operational challenges for HR, compensation, and business leaders.

Anticipating regulatory and workforce shifts well ahead of time, Xoxoday equips organizations with the infrastructure required to support modern, distributed, and flexible workforces, while staying aligned with evolving labour laws in India. 

Mobile-first communication for deskless and gig workers 

Retail and hospitality operations depend on workers who are constantly on the move, store associates, delivery partners, housekeeping staff, restaurant teams, and event-based workers. Traditional HR communication channels such as email or intranet portals often fail to reach this audience. 

A deskless workforce engagement solution from Xoxoday addresses this gap by enabling: 

• Real-time communication of shift updates, weekly off schedules, and policy changes 
• Mobile access to announcements and important compliance-related information 
• Consistent messaging across locations, shifts, and worker types.

This ensures that expectations around working hours, rest periods, and scheduling rules are clearly understood and uniformly applied, reducing disputes and operational friction. 

Supporting gig worker engagement in a regulated environment 

As gig workers gain formal recognition under the gig worker labour code, their expectations are changing. Transparency, fair treatment, and acknowledgment of effort are becoming key drivers of retention, especially in competitive retail and hospitality labour markets. 

Xoxoday’s recognition and rewards (R&R) solution helps employers reinforce compliant and reliable behavior by: 

• Recognizing gig workers who consistently adhere to schedules and service standards 
• Encouraging repeat engagement during peak periods 
• Ensure equitable access to benefits for blue-collar and deskless roles  
• Building loyalty among high-performing gig workers without altering employment structures.

This approach supports gig worker engagement while respecting the flexibility that gig-based models require.  

Wrapping up 

Labour Code 2025 marks a defining shift for retail and hospitality employers managing gig-heavy workforces. With gig workers now formally recognized under labour laws in India, businesses must rethink how they approach scheduling, compliance, and workforce engagement—especially in high-turnover, deskless environments. 

For organizations that respond proactively, this shift presents an opportunity. By combining compliant workforce practices with mobile-first communication, structured engagement, and recognition, employers can move beyond regulatory alignment to build a more reliable, motivated, and future-ready gig workforce. 

In a sector where service quality depends on frontline execution, the ability to engage and support gig workers effectively will be just as important as meeting the letter of the law.