GIFT IFSC Employment Compliance: Labour Codes, SEZ Formalities and Regulatory Staffing Requirements

An IFSC unit’s employment compliance in GIFT IFSC involves three key areas: Indian labour laws, SEZ and Gujarat state requirements, and IFSCA staffing rules governing designated officers and their place of employment.

The Labour Codes Are in Force

On 21 November 2025, the Central Government made the four labour codes effective:

• the Code on Wages, 2019;
• the Industrial Relations Code, 2020;
• the Code on Social Security, 2020; and
• the Occupational Safety, Health and Working Conditions Code, 2020.

The Government’s announcement records that the codes replace 29 existing labour laws, and makes two points that matter for practical compliance.

First, rules, regulations and schemes under the codes are still being framed, with stakeholder engagement. Second, and critically, during the transition the relevant provisions of the existing labour Acts and their rules, regulations, notifications, standards and schemes continue to remain in force.

The first point has since moved on. On 8 May 2026 the Central Government notified the final Central Rules under all four codes: the Code on Wages (Central) Rules, 2026, the Social Security (Central) Rules, 2026, the Occupational Safety, Health and Working Conditions (Central) Rules, 2026 and the Industrial Relations (Central) Rules, 2026 (G.S.R. 342(E)). They apply where the Central Government is the appropriate government, which includes establishments such as banking and insurance companies. That matters in GIFT IFSC, because an IFSC Banking Unit is part of a banking company and an IFSC insurance office is part of an insurer. For other establishments the appropriate government will generally be the State. Gujarat has final rules under all four codes: the Code on Wages (Gujarat) Rules, 2021 and the Industrial Relations (Gujarat) Rules, 2021 (notified 5 October 2021), the Code on Social Security (Gujarat) Rules, 2023 (notified 30 December 2023) and the Gujarat Occupational Safety, Health and Working Conditions Rules, 2025 (notified 6 June 2025). Each set is expressed to come into force with the corresponding code, and so took effect on 21 November 2025; amendment notifications issued in 2026 are published on the Labour Commissionerate’s labour-codes page and should be checked for the specific obligation in issue.

The practical consequence is that an employer in GIFT IFSC cannot simply switch its compliance to the codes and discard the earlier framework. Even with the Central and Gujarat rules in place, instruments issued under the repealed enactments continue under the savings clauses until superseded, so the overlap must be mapped obligation by obligation; and because labour is a concurrent subject, the rule-set that applies depends on which government is the appropriate government for the establishment.

For an employer in Gujarat, therefore, three questions should be asked of each obligation: which code provision now governs it; whether the Central or the Gujarat rules apply to the establishment and what form, register or authority they prescribe; and whether any pre-existing instrument continues to apply under the savings clauses in the interim.

SEZ and State Formalities

Operating inside GIFT SEZ adds a set of practical registrations. IFSCA’s published workflow for setting up a unit (Article 3) lists, among the steps after the Certificate of Registration:

• registration under the Gujarat shops and establishments framework for the unit;
• professional tax registration for the employer and for employees; and
• issuance of SEZ employee identity cards.

These are not optional conveniences. Entry into the SEZ and the ordinary state-law obligations of an employer depend on them, and they sit on the critical path between registration and the commencement of operations.

What IFSCA itself Requires

The most distinctive workforce obligations in GIFT IFSC come from the financial regulations rather than from labour law. Several frameworks require named officers and, importantly, require them to be physically based in the IFSC:

These requirements have employment-law consequences. Role descriptions, reporting lines, relocation terms and secondment structures must be capable of satisfying a regulator that the named individual genuinely performs the function from the IFSC. Where a group wishes to use a shared resource, the question is whether the relevant framework permits it, as the cyber security amendment expressly does for certain categories, or whether it requires a dedicated person.

Foreign Nationals

Employment of foreign nationals in GIFT IFSC is governed by India’s general immigration framework, including the employment visa regime administered by the Central Government, together with the registration requirements that apply to foreign nationals resident in India. Conditions, including any minimum remuneration thresholds and exemptions, are set by the relevant Government instructions and are amended from time to time. Because those conditions determine whether a proposed hire is permissible at all, they should be confirmed against the current instructions before an offer is made rather than assumed from earlier practice.

Social security for internationally mobile employees is governed by the Code on Social Security, 2020 framework read with the transitional continuation of existing schemes, and by any applicable social security agreement between India and the employee’s home country. Where a social security agreement applies, certificate-of-coverage procedures may avoid duplicate contributions.

Employee Data

An IFSC unit that relies on section 17(1)(d) of the Digital Personal Data Protection Act, 2023 for its client-facing processing does not obtain any exemption for the personal data of its own employees in India (Article 37). Employee data processing is ordinary data fiduciary activity, and it should be brought within the unit’s data protection programme ahead of the phased commencement dates.

A Practical Sequence for a New Unit

A new IFSC unit should approach employment compliance in a clear sequence, addressing regulatory staffing requirements, state and SEZ registrations, labour code transitions, employee role documentation and data protection before operations begin.

1. Map the regulatory staffing requirements for the specific licence before recruiting, since several roles must exist before commencement of operations.
2. Complete the state and SEZ registrations on the critical path: shops and establishments, professional tax and SEZ identity cards.
3. Run a transition analysis on the labour codes: what is now governed by a code, what still runs on the earlier Act pending rules, and what Gujarat has notified.
4. Document residence and role, since “based out of IFSC” is a supervisory expectation that must be evidenced.
5. Build employee data protection into the unit’s compliance programme from the outset.

Frequently Asked Questions

1. Which labour laws apply to employees in GIFT IFSC?

The applicable Indian labour laws, including the four Labour Codes brought into force in November 2025, govern employment obligations.

2. Do GIFT IFSC units need to comply with Gujarat labour requirements?

Yes. Applicable Gujarat-specific requirements and SEZ-related formalities must also be considered.

3. Does IFSCA prescribe staffing requirements for IFSC units?

Yes. Depending on the regulated activity, IFSCA regulations may prescribe specific officers, qualifications and location requirements.

4. Can GIFT IFSC units employ foreign nationals?

Yes, subject to applicable immigration, visa, employment and other legal requirements.

5. Are IFSCA staffing rules a substitute for labour law compliance?

No. Regulatory staffing conditions and general employment law obligations apply separately.