Kathmandu. The impact of the new labour code, which was enacted by the central government in November 2025, is now clearly visible. These rules have increased the staffing costs of private sector banks and insurance companies. As a result, their operating expenses increased in the October-December quarter.
HDFC Bank, India’s largest private sector bank, reported an operating expense of Rs 18,770 crore in the quarter under review. It was Rs 17,110 crore in the same period last year.
According to the bank, there has been an additional impact of about Rs 800 crore on employee costs in this quarter due to the new labor code. “It is monitoring the rules and clarifications from the central and state governments and will make further accounting changes as needed,” the bank said. ’
At the same time, ICICI Bank has estimated an impact of Rs 145 crore on its net profit during the review period due to the new labour code. The bank has made an additional provision of Rs 155 crore, Federal Bank Rs 20.8 crore and RBL Rs 32 crore.
The new labor code has also affected insurance companies. HDFC Life Insurance has reported an additional expense of Rs 106.02 crore towards employee benefits. ICICI Prudential Life Insurance has estimated an additional impact of Rs 11.04 crore and ICICI Lombard General Insurance has estimated an additional impact of Rs 53.06 crore.
The new labour code necessitates an increase in the basic wage component. This will require employers to contribute more to gratuity, pensions and social security funds. This will increase the overall employee cost.
On November 21 last year, the government promulgated four labour codes. These include the Code on Wages, 2019, the Industrial Relations Code, 2020, the Social Security Code, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020. These codes consolidate 29 old labor laws. –Agency
