The Indian Finance Ministry has introduced a significant reform linking compliance with labour laws to eligibility for government contracts. This policy aims to protect outsourced and contractual workers by ensuring that contractors pay wages on time and make necessary social security contributions. Firms that fail to comply can face debarment from bidding for up to three years. The amended Rule 151 of the General Financial Rules (GFR), 2017 now includes penalties for not paying wages and not depositing statutory contributions, especially if the government has to intervene. An office memorandum dated May 8, 2026, directs ministries and departments to ensure contractors disburse wages within prescribed timelines, with monthly compliance checks mandated. This initiative is expected to reduce wage payment delays and enhance accountability among contractors and employers, coinciding with the finalization of rules for four Labour Codes by the Ministry of Labour and Employment.