THE ENACTMENT of the Industrial Relations Code, 2020 (‘IR Code’) on November 21, 2025, brought about a significant change in the labour adjudication mechanism. The IR Code effectively abolished Labour Courts leaving behind a one-window adjudication forum at the Industrial Tribunal level. By its legislative scheme for adjudication, all industrial disputes, both the collective and individual disputes, would be decided by the reconstituted Industrial Tribunals. A notification released on December 8 by the Ministry of Labour and Employment, called the Industrial Relations (Removal of Difficulties) Order, 2025, recognised the institutional void that this transition creates and permitted existing Labour Courts to continue until the new Tribunals are constituted and operational. But this is a deferral, not a reprieve. Essentially the statute abolishes the Labour Courts.
The objective of the labour law reform is simplification and increasing accessibility to labour rights. The argument is that Labour Courts are slow, overburdened, and redundant. A single unified forum which would be more efficient. But efficiency is an implementation question – it is not necessarily linked directly to the failure of the institution itself. And the particular inefficiencies of Labour Courts such as delay, formalism, and backlog have been studied, diagnosed, and prescribed for by Indian and comparative scholars over more than five decades. Not one credible prescription in that body of scholarship recommends abolition of Labour Courts. What has been consistently recommended is structural reform of the adjudication model.
