In a historic decision, the Punjab Cabinet, chaired by Chief Minister Bhagwant Mann, approved a comprehensive framework to end the long-standing contractual employment system and regularise more than 65,000 workers across 51 state departments.The move aims to provide direct employment, job security, and benefits equivalent to regular government employees.

The Cabinet repealed the Punjab Adhoc, Contractual, Daily Wage, Temporary, Work Charged and Outsourced Employees' Welfare Act, 2016, and approved two new bills: the Punjab State Outsourced Personnel (Transition to Contractual Engagement) Bill, 2026, and the Punjab Contractual Personnel (Absorption Against Sanctioned Vacancies) Bill, 2026.

Employees who have completed five years of continuous service, or three years for high-risk roles such as fire personnel and sanitation workers, will become contractual employees, with the possibility of absorption into regular posts after 10 years.Wages will be paid directly into bank accounts, with statutory benefits like maternity leave and casual leave.Transparency measures and protection against arbitrary termination will be implemented.

The Cabinet also set up a sub-committee to examine pending arrears of pay and pensions, and approved seven special courts to expedite corruption cases.

The reform will impact thousands of employees in sectors including power, local government, cooperatives, school education, transport, health, and public works.The phased implementation is expected within 45 days of approval.