SKP Business Alert
4 January 2018
Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017

The Government of Maharashtra has notified the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 with effect from 19 December 2017. The Act replaces the erstwhile Maharashtra Shops and Establishments Act, 1948.

The Act is applicable to all establishments in the State of Maharashtra, employing 10 or more workers.

Registration of establishments with 10 or more workers
Every establishment employing ten or more workers shall register under the Act by making an application in the prescribed manner. The application is required to be made within 60 days from the date of commencement of this Act or the date on which the establishment commences its business.

The above registration shall not be applicable to establishments already having a valid registration under the existing Maharashtra Shops and Establishments Act, until the expiry of their registration.

Intimation of establishment employing less than 10 workers
Every establishment employing less than 10 workers is required to give an intimation of having commenced the business to the facilitator (government authority) by submitting an application within the prescribed time and in a prescribed form.
If at any point in time the number of workers engaged in the establishment becomes 10 or more, then all provisions of this Act shall apply to such establishment and the employer shall have to obtain registration.

Change to be communicated to the facilitator
Any change in any of the particulars contained in the application submitted is required to be intimated to the facilitator.

Closing of establishment to be communicated to facilitator
The employer is required to intimate about the closure of the establishment to the facilitator within 30 days from the date of closing of the business.

Daily and weekly hours of work in the establishment and interval for rest
Working hours for workers shall not exceed nine hours in any day and 48 hours in any week. The workers shall be given a break of at least half an hour after working for five hours continuously, except in case of urgent work with the previous permission of the facilitator.

Prohibition of discrimination against women workers
The Act has introduced a new concept for the safety of women employees. The Act prohibits discrimination of women employees in the matter of recruitment, training, transfers or promotion or wages.

Considering the safety of women employees, the Act restricts working hours for women employees between 7:00 am to 9:30 pm. Women employees (with consent) shall be allowed to work during 9:30 pm and 7:00 am only if adequate protection of their dignity, honour and safety, protection from sexual harassment and their transportation from the establishment to the doorstep of their residence are provided by the employer.

Spread-over in establishments
The spread-over of a worker in the establishment shall not exceed ten and half hours in any day, and in case of urgent work, the spread over shall not exceed twelve hours.

Wages for overtime
Overtime wage shall be paid for work beyond nine hours a day or 48 hours a week. The overtime wages shall be at the rate of twice the worker's ordinary rate of wages. The total number of overtime hours shall not exceed 125 hours in three months.

Weekly holiday for worker
An establishment may be kept open on all days in a week. However, every worker shall be given one weekly-off.

Compensatory leave shall be given in case the worker works on a weekly off day and the worker shall be entitled to wages at the rate of twice his ordinary rate of wages.

Issue of Identity card with specific information
The Act mandates employers to provide identity cards to each worker and also provides the details to be mentioned on the identity card.

Every worker shall be entitled to eight days casual leave in every calendar year which shall lapse if not availed at the end of the year. A worker shall be entitled to eight paid festival holidays in a calendar year. Every worker shall be permitted to accumulate earned leave up to a maximum of 45 days.

Welfare Provisions
The Act also provides for the welfare of the workers in terms of health, safety, drinking water, latrines and urinals, canteen, crèche facility, etc. Following are some of the guidelines mentioned in the Act:

  • The establishment shall take measures relating to cleanliness, lighting, ventilation and prevention of fire.
  • First-aid facilities shall be provided at the work place.
  • Sufficient supply of wholesome drinking water shall be provided and effective arrangements shall be made for latrines and urinals.
  • In establishments with 50 or more workers, crèche facility shall be provided for the use of children of such workers.
  • In establishments with more than 100 workers, canteen facility shall be provided.

Maintenance of registers and records and annual return
The establishment is required to maintain certain registers and file certain returns annually. The format of registers and returns are yet to be prescribed by the state government.

SKP's Comments
This is a welcome change for all establishments in Maharashtra as the amended law will benefit smaller establishments to a great extent. The new law will provide establishments with greater flexibility in managing their compliances using electronic methods. However, some provisions such as crèche, displaying the of persons and computation of leave may pose compliance challenges for employers. There would also be a greater onus on employers to ensure that compliances are up to the mark under the risk of significantly larger penalties.
Urmi Axis | 7th Floor | Famous Studio Lane | Dr. E. Moses Road | Mahalaxmi | Mumbai  | 400 011 | India
+91 22 6730 9000 | |

India | USA | Canada | UAE
This alert contains general information which is provided on an “as is” basis without warranties of any kind, express or implied and is not intended to address any particular situation. The information contained herein may not be comprehensive and should not be construed as specific advice or opinion. This alert should not be substituted for any professional advice or service, and it should not be acted or relied upon or used as a basis for any decision or action that may affect you or your business. It is also expressly clarified that this alert is not intended to be a form of solicitation or invitation or advertisement to create any adviser-client relationship.

Whilst every effort has been made to ensure the accuracy of the information contained in this alert, the same cannot be guaranteed. We accept no liability or responsibility to any person for any loss or damage incurred by relying on the information contained in this alert.

© 2018 . All rights reserved.