Under the Industrial Relations Code, 2020, where an employer of an industrial establishment proposes to effect a "lay-off", "retrenchment", or "closure", certain establishments are required to seek prior permission of the appropriate Government. This requirement of prior permission applies to industrial establishments (not being of a seasonal character) wherein the number of workers employed on an average per working day in the preceding twelve months was:

Explanation: Chapter X of the Industrial Relations Code, 2020 (Sections 65 to 73) deals with lay-off, retrenchment and closure, and the special provisions requiring prior government permission apply to industrial establishments employing 300 or more workers on an average per working day in the preceding twelve months. Under Section 70, no worker in such an establishment can be laid off without prior permission of the appropriate Government, except for reasons of shortage of power or natural calamity. Similarly, Section 71 requires prior permission for retrenchment, and Section 75 for closure of the undertaking. The earlier threshold under the Industrial Disputes Act, 1947 was 100 workers, which has been raised to 300 by the Code. The appropriate Government may, by notification, extend these provisions to establishments employing fewer workers. This higher threshold is intended to give larger establishments greater operational flexibility while protecting workers through the permission mechanism.