The Draft Code on Social Security (Central) Rules, 2025, frames its provisions in the language of transparency and digitisation. Yet, under the guise of high-tech administrative neutrality, the Union government appears to be fundamentally altering the nature of employment tenure. A close examination of Rule 34, which governs the application for and payment of gratuity, suggests a shift that prioritises procedural efficiency over worker security.To the casual observer, Rule 34 might appear to be a series of administrative updates. However, critics argue it constructs a complex framework that manages deferred wages in a way that risks diluting established labour rights.The fixed-term trapThe most significant reform in Rule 34 is the introduction of pro-rata gratuity for Fixed-Term Employees (FTEs). Rule 34(1)(a) explicitly states that an employee on a fixed-term contract shall be eligible for gratuity if they render service for at least one year. Previously, the five-year continuous service requirement acted as a barrier to arbitrary dismissal, creating an escalating financial liability for the employer as a worker’s tenure increased.The government presents this one-year threshold as a benefit to the precarious worker. In reality, it may act as a structural subsidy for a “hire and fire” culture. By legalising a one-year gratuity payout, the Union government has effectively “priced” the exit of a worker. For a pro-rata premium, an employer is now incentivised to avoid the long-term legal and financial obligations of a tenured workforce.Also read: Do the Draft Social Security Rules Legalise Precarity for Gig Workers?Whether it is a factory hand or a software engineer on a project-based contract, the implication is that labour is a consumable commodity. This shift risks institutionalising precarity, leaving the workforce in a state of permanent probation, unable to build the seniority required for collective bargaining.The definition of wageThis structural instability is further entrenched by the explanation attached to Rule 34(2)(a). It provides a detailed list of exclusions from the definition of “wage” for gratuity calculation. The law now explicitly excludes medical reimbursements, stock options (ESOPs), crèche allowances, internet and telephone allowances and annual performance-linked bonuses.This provision legally validates the “cost to company” structure common in the corporate sector, where the “basic wage” is frequently suppressed to 40% or 50% of the total paycheck. By anchoring gratuity calculations solely to this shrunken “wage”, Rule 34 authorises a reduction in the worker’s deferred earnings.When a corporate employee exits, they may find their security calculated on a diminished version of their actual income. The law has effectively partitioned the paycheck into a “protected” core and a “disposable” periphery, ensuring that the corporate entity retains a larger share of the value produced.The thirty-day deadlineRule 34(1)(a) mandates that an employee “shall apply, ordinarily within a period of thirty days” from the date the gratuity becomes payable. In an era where Rule 54 requires employers to maintain exhaustive electronic registers, the insistence on a worker-initiated claim appears redundant.Representative image of a gig worker: a Zomato delivery agent stands at a railway platform. Photo: X/@deepigoyalWhile the word “ordinarily” provides some flexibility, Rule 34(1)(e) places the burden on the claimant to “adduce sufficient cause” for delay. For a migrant labourer or a professional dealing with job loss, this 30-day window is a procedural hurdle. By transforming an entitlement into a “justifiable claim”, the state shifts the right to gratuity from an absolute to a discretionary realm, dependent on a “competent authority”.The dispute mechanismShould an employer dispute a claim, perhaps by invoking “gross misconduct” under Rule 39, the worker enters the domain of the “competent authority” (Rules 34(4) through 34(12)). Here, the draft rules construct a quasi-judicial process involving “authorised representatives”, “summons” (Form-VII), and the production of certified copies.Also read: Explainer | How Do the Draft Labour Rules Shift Power to the Employer?While a corporation may view a legal dispute as a business expense, the individual finds it a drain on resources. The process risks exhausting the claimant. It constitutes a form of “forensic attrition,” where procedural complexity forces the worker to accept a settlement that is a fraction of their due, simply to end the bureaucratic engagement.The portal as a barrierThe insistence on electronic submission via the “Shram Suvidha Portal” provided for under Rule 34(1)(f) may act as a mechanism of exclusion. The Universal Account Number becomes a critical choke point. If an employer fails to verify service particulars (Rule 33(2)) or if there is a mismatch in Aadhaar-seeded data, the portal becomes an impenetrable wall. The worker’s agency is replaced by a digital record; if unauthenticated, the individual has limited recourse.Finally, Rule 34 of the 2025 rules reflects a philosophy where so-called ease of doing business is structurally prioritised. By eroding the definition of wages and pricing the exit of the employee, the state signals that social security is being redefined as the orderly management of labour’s disposability. Whether for the white-collar or blue-collar worker, the arithmetic of Rule 34 suggests a diminishing return on years of service.