Night Shift Allowance in India and Who Actually Decides It
No Code names a night shift allowance rate. What it settles is the calendar, the consent and the deductions, and those cost more than the figure most employers argue over.
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There is no night shift allowance in central law. No Code sets a rate, a percentage or a minimum for working nights.
What it does settle is which day a late hour belongs to, who has to agree to work it, and what your own payment drags along with it. Those three decide more about your night shift than the rate you pick.
The percentage figures that circulate come from company policy, not from a statute. I went and read the Codes before writing that, because it is the kind of claim people repeat without opening anything.
This page sets out what the law actually covers, and what your night shift allowance costs you once you have set it.
Key Takeaways
- Night shift allowance is yours to set: not one of the four Codes names a figure, so nobody sets it but you.
- Midnight moves the day: late hours land in the day the shift began, not the date on the punch.
- The weekly off shifts too: it starts when the night shift finishes, so a calendar Sunday is not enough.
- Consent is statutory: a woman rostered outside 6 a.m. to 7 p.m. has to agree first, whatever else applies.
- Extra pay is wages: money for working the hour, as against a reimbursement, enters the PF, ESI and gratuity base.
- Night pay is not overtime: two separate payments, and a shift that overruns earns you both.
Is There a Night Shift Allowance Rule?
There are rules, but not a rate. Searching the four labour codes and the central minimum wage order returns nothing for a night or shift allowance, while three other things about night work are settled.
The rate is the one thing the statute leaves alone.
Section 28 of the Occupational Safety, Health and Working Conditions Code, 2020 deals with a shift that runs past midnight. It answers two questions, and both of them are about the calendar rather than the payslip.
| What people look for | What the law actually gives | Where it sits |
|---|---|---|
| A percentage or a minimum rate | Nothing. No Code names a figure | Not in any of the four Codes |
| How the night hours are counted | Hours after midnight count in the previous day | Section 28 of the OSH Code |
| When the weekly off starts | 24 hours from the moment the shift ends | Sections 28 and 26 of the OSH Code |
| Whether anyone can be put on nights | Women must consent, plus safety conditions | Section 43 of the OSH Code |
| What your own allowance costs | It is wages, so the deductions follow it | Section 2 of the Code on Wages |
In Simple Words
No central law says what to pay for a night shift. That is your call. The law only says which day the late hours count in, who must say yes to them, and that the extra pay is part of wages.
Attendo (formerly Petpooja Payroll) is a complete workforce management system for every kind of business, running attendance, shifts, leaves, payroll and statutory filings in one place. Petpooja has built software for Indian businesses since 2011, and 40,000+ of them run on Attendo today.
Which Day Do Night Hours Belong To?
They belong to the previous one. Section 28 puts the hours worked after midnight back into the day the shift started.
Take a shift running from 10 p.m. on Tuesday to 6 a.m. on Wednesday. Two of those hours fall on Tuesday by the clock. The other six fall after midnight, and the Code puts all six back into Tuesday as well.
So the whole shift is a Tuesday shift. Wednesday, for that person, has not started yet.
Why That Changes the Payroll Run
Three things hang off which day an hour belongs to, and every one of them shows up in the payroll run.
- The daily hours cap. Whatever your normal day runs to, you count it per day, so six hours landing back in Tuesday count against Tuesday and not Wednesday.
- Overtime. Section 27 pays twice the rate of wages past the prescribed hours, and the day those extra hours sit in decides which day went over.
- Attendance records. A punch at 2 a.m. logged against the calendar date puts the hours in the wrong day, and the register then disagrees with the Code.
A newspaper press in Kochi finishing its run at 3 a.m. and a paper mill in Coimbatore on a night shift both have to count those hours against the day the shift began.
So is the night desk at a hotel in Jaipur, and the warden on duty at a residential school in Dehradun.
The statutory register formats show where the periods of work have to be recorded, which is where a mis-dated punch shows up first.
The Weekly Off Moves As Well
Section 26 caps the week at six days. Section 28 then changes when the rest day starts for somebody on nights.
Their weekly holiday is twenty-four consecutive hours beginning when the shift ends. Not midnight, and not the start of the calendar day.
For a shift ending at 6 a.m. on Sunday, the rest day runs to 6 a.m. on Monday. Rostering that person back at 10 p.m. on Sunday cuts the weekly holiday short, even though the calendar says they had Sunday off.
Did You Know?
Section 29 stops two teams doing the same work at the same time on overlapping shifts. Your government can let you off in writing, with its reasons recorded. A mine can never be let off.
Who Has to Agree to a Night Shift?
Women do, expressly. Section 43 makes their consent a condition before they work outside daytime hours.
The section opens by settling the wider question. Women are entitled to be employed in all establishments for all types of work under the Code.
It then attaches a condition to the clock. Any work outside 6 a.m. to 7 p.m. needs her consent first. The Code writes those as two separate periods, before 6 a.m. and beyond 7 p.m., so either one counts.
Midnight and these two times are the only clock hours the Code puts on night work at all. Midnight moves the day. These two trigger a conversation and whatever safeguards your government has set, not a payment.
A 24-hour convenience store chain in Kolkata and a data centre run by an IT services firm in Chennai both need that consent on record, not assumed from the roster. So does a dialysis clinic in Lucknow running an overnight slot.
Which Government Sets the Conditions?
Section 43 also lets a government prescribe conditions on safety, holidays and working hours for that work. Check whether yours has, because the Code gives the power without using it.
Which government that is depends on whether your state or the Centre regulates you. The guide to the Code on Wages rules works out which one you answer to.
It is worth settling, because more than one condition on this page is left to whoever that turns out to be.
One More Limit People Miss
Section 30 stops a second job in the same twelve hours. Nobody may work in a mine or a factory if they have already worked in another such establishment within the preceding twelve hours, except in prescribed circumstances.
So somebody finishing a night shift at 6 a.m. cannot start a day shift at another factory at noon, unless the circumstances are ones the rules allow.
What Will the Allowance Cost You?
More than the allowance itself, because the Code on Wages treats it as wages and the statutory deductions follow.
Section 2 of the Code on Wages, 2019 defines wages as all remuneration whether by way of salaries, allowances or otherwise. That opening line names allowances outright.
The section then lists its exclusions. Statutory bonus, house rent allowance, conveyance allowance, employer provident fund contributions, overtime allowance, commission, gratuity and a few more.
A night or shift allowance is not on that list. So extra pay for the hour sits inside wages, and everything calculated on wages moves with it. A genuine reimbursement is a different matter, which the next part goes into.
- Provident fund, where the establishment is covered.
- Employee state insurance contributions, and the wage limit that decides who is covered at all.
- Gratuity, which is worked out on wages last drawn.
- The check that the total still clears the minimum rate set for that employment.
What It Looks Like on a Payslip
Take a worker on ₹18,600 a month who works nineteen night shifts, and say your policy pays ₹150 a night (an example, since no Code sets a figure).
That is ₹2,850 on top. Their wages for the month are ₹21,450, not ₹18,600, and every deduction worked out on wages moves with that.
The provident fund contribution rises, because it is a percentage of a bigger number. More awkwardly, ₹21,450 sits above the ₹21,000 employee state insurance wage limit, and ₹18,600 did not.
So a payment you set yourself, at a figure no statute asked for, can decide whether somebody is inside the scheme at all.
The conveyance allowance rules show how an allowance the Code does exclude gets handled differently.
The Label Does Not Decide It
One exclusion is worth reading twice. Money that simply pays somebody back for a cost the job forced on them is left out of wages. The Code puts it as a sum paid to defray special expenses entailed by the nature of the employment.
If what you actually pay is a reimbursement, a cab home at 2 a.m. or a meal on a night run, that is a different kind of payment. If it is extra money for working odd hours, it is pay, and pay is wages.
Calling a payment an allowance does not move it out of wages. What the payment is for decides that, so write the purpose into the policy and keep the two separate on the payslip.
Must Know
You cannot shrink wages by moving pay into the excluded items. If those come to more than half of everything you pay somebody, the Code pushes the excess back into wages.
Night Shift Allowance or Overtime?
Both, on a night shift that runs long. They are separate payments and one does not cover the other.
Overtime is section 27 of the OSH Code. It pays twice the rate of wages for work past the hours your government has prescribed for a day or for a week, and it needs the worker’s consent.
A night shift allowance is not in any Code. It is a policy payment for working at an hour most people do not.
| Overtime | Night shift allowance | |
|---|---|---|
| Where it comes from | Section 27 of the OSH Code | Your own policy |
| What triggers it | Hours past those prescribed for a day or a week | The shift falling at night |
| The rate | Twice the rate of wages | Whatever you set |
| Counts as wages | No, overtime allowance is excluded | Yes, no exclusion covers it |
Somebody rostered 10 p.m. to 6 a.m. who then stays until 8 a.m. is owed the night allowance you promised and the statutory overtime rate for the two extra hours.
The salary per day calculator converts a monthly wage into the daily and hourly figures both payments are worked out from.
None of this is hard on one roster. It gets hard when the shift crosses midnight, the allowance has to reach the right people, and the hours have to be counted against the day before.
Where Attendo Fits
Shift management covers 9-to-5, rotating, overnight and 24-hour timings, so a shift that crosses midnight is set up as one shift rather than two half-days.
The shift sits in the system as one block, so the hours after midnight stay attached to the day it started rather than to the date printed on the punch, and that is what reaches payroll.
Staff are put into payroll groups, and each group carries its own rules, so the night team can have a different allowance and a different overtime setting without a second payroll run.
A setting called Simple Shift strips all of that back to one shift and one schedule, for a business that does not need the rest yet.
If you want night rosters handled this way, you can take a look at Attendo, or read how it works end to end first.
How to Set a Night Shift Allowance
Write the number down, say what it is for, and make the roster prove who earned it. The checklist below is the rest.
If I had to pick the mistake that costs most, it is paying the allowance off a spreadsheet of who was supposed to be on nights rather than who actually was.
- Set the rate in writing, as a figure or a formula, and say which shifts qualify by their start and end times.
- Decide whether it is extra pay or a reimbursement, and write down which, because what it is for decides whether it is wages.
- Record consent where section 43 of the OSH Code needs it, before the roster goes up rather than after.
- Count the hours after midnight in the previous day, in the register and in the payroll run.
- Give the weekly off a full twenty-four hours from when the shift ends, not from midnight.
- Pay overtime separately when the night shift also runs long.
The salary sheet and payroll register template has the columns an allowance needs to sit in, and the attendance to salary workflow shows where the shift hours turn into a figure.
Every section quoted here has been in force since the four labour codes took effect on 21 November 2025.
If you would rather the rosters, the midnight split and the allowance worked themselves out, Attendo does that part.
Frequently Asked Questions
1. What is the night shift allowance rate in India?
2. Is night shift allowance mandatory in India?
3. Does night shift allowance count as wages?
4. Which day do hours after midnight belong to?
5. When does the weekly off start for a night shift worker?
6. Is night shift allowance the same as overtime?
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