The Model Shop and Establish men ts (Regulation of Employment

and Conditions of Service) Bill, 2016

THE---- (Name of State) SHOPS AND ESTABLISHiVIENTS (REGULATION

OF EMPLOYMENT AND CONDITIOl'iS OF SERVICE) BILL, 2016
A

Bill

w cn;1end Cl'lli consolidate the /mrs relating to regulation of employment aJ;d othe,-
conditions of service of workers employed in shops and establishillenrs and
for matrers connected the1 ewith or incidental thereto.

BE it enacted by the Legislature of the State of the -------- (Name of State) in

the Sixty-seventh Year of the Republic of India as follows :-

CHAPTER I
PRELIMINARY
1.(1) This Act may be called the ---- (Name of State) Shops and Shon title.
apphcal!on and
Establishments (Regulation of Employment and Conditions of Service) Act, 2016. commencement.

(2) It shall apply to the shops and establishments employing ten or more
workers.
(3) It shall come into force on such date as the State Government may, by
notification in the Official Gazette, appoint.

2. In this Act, unless the context otherwise requires,- !Xfinnions

(a) "Chief Facilitator" means the Chief Facilitator appointed as such

under sub-section (f) of section 17;

(b) "clay" means a period of twenty-four hours beginning at mid night;

(c) "employer" means an owner or a person who has ultimate control

over the affairs of a shop or an establishment, and includes-
 (i) in the case of a firm or association of individuals, a partner or
member of the firm or association;

(ii) in the case of a company, a director of the company;

(iii) in the case of a shop or an establishment owned or

controlled by the Central Government or a State Government or local
authority, the person or persons appointed to manage the affairs of
such shop or establishment by the Central Government or the State
Government or local authority, as the case may be;

(d) ''establishment" means any premises, not being the premises of a

factory or a shop,-

(i) wherein any trade, business, manufacture, or any work in

coMecrion with, or incidental or ancillary thereto, or any journalistic
or printing work, or business of banking, insurance, stocks and shares,
brokerage or produce exchange, is carried on; or

(ii) which is used as theatre, cinema, or for any other public

amusement or entertainment,

to whom the provisions of the Factories Act, 1948 does not apply;
63 of 1943.
(e) ''notification" means a notification published in the Official
Gazette;

(j) "prescribed" means prescribed by rules made under this Act;

•
(g) "shop" means any premises where goods are sold, either by retail
or vvholesale or where services are rendered to customers, and includes an
office, a store-room, go-down, warehouse or workhouse or \YOrk place for
distribution or packaging or repackaging or finished goods is carried on; but
does not include a shop attached to a factory where persons employed in
63 of i9JS. such shop are allowed the benefits provided under the Factories Act, 1948;

(h) "wages" means all remuneration (whether by way of salaty,

allowances or otherwise) expressed in terms of money or capable of being so
expressed which would, if the terms of employment, express or implied,
were fulfilled, be payable to a person employed in respect of his employment
or of work done in such employment, and includes-

(i) any remuneration payable under any award or settlement

between the parties or under any order of a court or tribunal;

(ii) any remuneration to which the person employed is entitled in

respect of overtime work or holidays or any leave period;

(iii) any additional . remuneration payable under the tenns of

employment (whether called a bonus or by any other name);

(iv) any sum which by reason of the termination of employment of

the person employed is payable under any law, contract or instrument
which provides for the payment of such sum, whether with or without
deductions;
 (v) any sum to which the person employed is entitled under any
scheme framed under any law, for the time being in force; and

(vi) house rent allowance,

but does not include-

(A) any bonus, which does not form part of the remuneration
payable under the terms of employment or which is not payable under
any award or settlement between the parties or under any order of a
court;

(B) the value of any accommodation, or of the supply of light,

water, medical attendance or other amenity or of any service excluded
from the computation of wages by a general or special order of the
State Government;
(C) any contribution paid by the employer to any pension or
provident fund, and the interest vvhich may have accrued thereon;
(D) any travelling allowance or the value of any travelling
concessiOn;

(E) any sum paid to the employed person to defray special

expenses entailed to him by the nature of his employment; or

(F) any gratuity payable on the termination of employment in

cases other than those specified in sub-clause (iv);

(i) 'week" means a period of seven days beginning at midnight on

Saturday night or such other night as may be approved in writing for a
particular area by the Chief Facilitator;

U) '·worker" means any person (except an apprentice under the

52 of 1961 Apprentice Act, 1961) employed to do any manual, unskilled, skilled,
technical, operational or clerical work for hire or reward, whether the terms
of employment be express or implied.

3. (1) The provisions of this Act shal l not apply to- Act not to apply to
certain persons and
(a) a worker occupying position of confidential, managerial or premises.
supervisory character in a shop or in an establishment;
(b) a worker whose work is inherently intermittent;
(c) any office of the Government or the local authority;
(d) any office of the Reserve Bank ofindia;
(e) an establishment used for the treatment or care of the sick, infirm,
destitute or mentally unfit; and
(j) a member of the family of an employer.

(2) A list of the workers referred to in clause (a) of sub-section (/)shall be

displayed on the website of the shop or establishment and in absence of the
website at a conspicuous place in the shop or establishment and a copy thereof
shall be senllo the Facilitator.
 4. Nothing contained in this Act shall adversely affect any right or privilege Cenain rights and
privileges not to be
to which any worker is entitled, under any law, award, agreement, contract, custom affected.
or usage for the time being in force.

CHAPTER II
REGISTRATION AND ISSUE OF LABOUR IDENTIFICATION NUMBER
5.(1) On the commencement of this Act, every shop and establishment Registration of
shops and
employing ten or more workers, shall apply for registration within a period of six establishments and
months from the date of such commencement or the date on which such shop or issue of Labour
Identification
establishment comes into existence and obtain a Labour Identification Number. Number.

(2) Every shop and establishment, employing ten or more workers, shall
make an application for registration to such authority and in such form and manner
as may be prescribed.

(3) The authority referred to in sub-section (2) shall, on receipt of an

application under sub-section (2) register the shop or establishment and issue it a
Labour Identification Number in such form as may be prescribed.

(4) Notwithstanding anything in this section, the shops and establishments

34 of 1948. registered under the provisions of the Employees State Insurance Act, 1948 or the
19ofl952. Employees Provident Fund (Miscellaneous Provisions) Act, 1952 or any rules,
regulations or scheme made thereunder shall be deemed to be registered for the
purposes of this Act:

Provided that such shops and establishments shall, within a period of six
months from the commencement of this Act, obtain a Labour Identification
Number in such manner as may be prescribed.

CHAPTER III
DUTIES OF EMPLOYER
6.(1) No woman worker shall be discriminated against m matters of Prohibition of
discrimination
recruitment, training, transfers or promotions or wages. against woman
worker.
(2) No woman shall be required or allowed to work m a shop or
establishment except between the hours of 6 a.m. and 9 p.m.:
Provided that where the State Government or any person, authorised by it in
this behalf, is satisfied that the provision of shelter, rest room, night creche, ladies'
toilet, adequate protection of their dignity, honour and safety, protection from
sexual harassment, and their transportation from the shop or establishment to the
door step of their residence exists in such shop or establishment, it may, by
notification, after obtaining the consent of the woman worker, allow her to work
between 9 p.m. and 6 a.m. subject to such conditions as may be specified in the
notification.

4
 7. (1) Evety employer shall take such measures relating to the health and Health and saf~ty of
workers
safety (including cleanliness, lighting, ventilation and prevention of fire) of the
workers as may be prescribed.

(2) Every employer shall be responsible for providing constant and adequate
supervision of the workers employed in the shop or establishment and to ensure the
compliance with the mles relating to health and safety made under sub-section (/)
and for taking steps necessary to prevent accidents.

8.(1) No adult worker shall be required or allowed to work in a shop or Fixing of hours of
establishment for more than forty-eight hours in any week and nine hours in a day ~~o;~andspread
and no worker shall be asked to work continuously for more than five hours unless
he has been given a break of not less than half an hour:
Provided that the working hours or of weekly rest may be relaxed in case of
work of urgent nature with the previous pennission of the Facilitator.
(2) The total number of hours of work in a shift including the rest interval
shall not exceed ten and half hours in any shop or establishment and in case a
worker is entrusted with intennittent nature of work or urgent work, the spread
over shall not exceed twelve hours.
(3) Any working hour beyond nine hours a day or fotty-eight hours a week
shall be treated as overtime and the total number of overtime hours shall not
exceed one hundred and twenty-five hours in a period of three months.
(.f) The State Government shall make rules to.-

(a) subject to sub-section (1), fix the number of hours of \Vork which
shall constitute a nonnal working day for the workers employed in the shop
or establishment, inclusive of one or more specified intervals;
(b) provide for a day of rest in every period of seven days which shall
be allowed to all the workers employed in the shop or establishment and for
the payment of remuneration in respect of such days of rest.
(5) The provisions of sub-sections {1) and (2) shall, in relation to the
following class of workers employed in such shop or establishment, apply only to
such extent, and subject to such conditions, as may be prescribed, namely::-
(a) workers engaged on urgent work, or in any emergency which
coi.tld not have been foreseen or prevented;
(b) workers engaged in the nature of preparatory or complementary
vvork which must necessarily be carried on outside the normal hours of work
laid down in the rules;
(c) workers engaged in any work which for technical reasons has to be
completed before the day is over; ·
(d) workers engaged in a work which cannot be carried on except at
times dependent on the irregular action for natural forces; and
(e) highly skilled workers (such as workers working in the
establishments of Information Technology, Bio-Technology and Research
and Development Divisions).
 9. Where any worker is required to work on any day in excess of nine hours Wages for overtime
work
and forty-eight hours in a vveek, he shall be entitled to wages at the rate of tvvice
his ordinary rate of wages or such higher amount as may be prescribed.

10. (1) A department or any section of a department of the shop or Shift working and
establishment may work in more than one shift at the discretion of the employer resr.
and if more than one shift is worked, the worker may be required to work in any
shift at the discretion of the employer.

(2) A shop or an establishment may work on all days in a week subject to the
condition that every worker shall be allowed weekly holiday of at least twenty-four
consecutive hours ofrest.
(3) If a worker is denied weekly holiday, the compensatory leave in lieu
thereof shall be given within two months of such weekly holiday.
(4) The period and hours of work in a week for all classes of workers in such
shift shall be informed to all workers in writing and shall be sent to the Facilitator
electronically or otherwise.

(5) Where a worker is required to work on a day of rest, he shall be entitled

to wages at the rate of twice his ordinary rate of wages.

CHAPTER IV
LEAVE AND HOLIDAYS
11. (I) Every worker shall be allowed a weekly holiday with wages: Annual leave, casual
and sick kave and
o1hu holidays.
Provided that the State Government may, by notification, fix different days
as weekly holiday for different class of shops and establishments or areas.
(2) Every worker shall be entitled to eight days' casual leave with vvages in
every calendar year which shall be credited into the account of the worker on a
quarterly basis.
(3) Every worker who has worked for a period of two hundred and forty days
or more in a shop or establishment during a calendar year shall be allowed during
the ~ubsequent calendar year, leave with wages for a number of days calculated at
the rate of one day for every twenty days of work performed by him during the
previous calendar year.
(4) Every worker shall be pennitted to accumulate earned leave upto a
maximum of forty-five days.
(5) Where the employer refuses to sanction the leave due when applied
fifteen days in advance, then the worker shall have a right to encash the leave in
excess of forty-five days:
Provided that if a worker is entitled to leave under this section, is discharged
by his employer before he has been allowed the leave, or it: having applied for and
having been refused the leave, he quits his employment on account of retirement,
resignation,. death or permanent disability, the employer shall pay him full wages
for the period of leave due to him.

(6) A worker shall be entitled to eight paid festival holidays in a calendar

year, namely, the Independence Day, Republic Day and Gandhi Jayanti and five
6
 such other festival holidays as may be agreed to between the employer and the
workers, before the commencement of the year.

(7) For the purpose of sub-section (3)-

(a) any day of lay-off, by agreement or contract or as permissible
under the model standing orders or standing order certified under Industrial
20 of 1946 Employment (Standing Orders) Act, 1946;
(b) in the case of a female worker, the maternity leave under the
53ofl961
provisions of the Maternity Benefits Act, 1961;

(c) the leave earned in the year prior to that in which the leave is
availed; or
(d) the absence of the worker due to temporary disablement caused by
accident arising out of and in the course of his employment,
shall be deemed to be days on which the worker has worked in a shop or
establishment for the purpose of computation of the period of two hundred and
forty days or more, but shall not earn leave for these days.

(8) The leave admissible under sub-section (3) shall be exclusive of all
holidays whether occurring during or at either end of the period of leave.

CHAPTERV
WELFARE PROVISIONS
12. Every employer shall make effective atTangements to provide and Drinking 1\ater
maintain at suitable points conveniently situated for all persons employed in the
shop or establishment, a sufficient supply of wholesome drinking water.

13. Every employer shall provide sufficient latrine and urinal for male and Latrines and urinals.
female as may be prescribed which shall be so conveniently situated as may be
accessible for the workers employed in the shop or establishment
Provided that several employers may provide common facilities, in case it is
not possible in a shop or establislunent due to constraint in space or otherwise.
14. In every shop or establishment wherein thirty or more woman workers or Creche Facility.
fifty or more workers are ordinarily employed, there shall be provided and
maintained a suitable room or rooms as creche for the use of children of such
woman workers:
to
Provided that if a group of shops or establishments, so decide provide a
common creche within a radius of one kilometre, then, the same shall be permitted
by the Chief facilitator, by an order, subject to such conditions as may be specified
in the order.
15. Every employer shall provide at the place of work first-aid facilities as First·aid.
may be prescribed.
16. The State Government shall require the employer to provide and Canteen.
maintain in the shop or establislm1ent, wherein not less than one hundred workers
are employed or ordinarily employed to maintain a canteen for the use of its
workers:
 Provided that if a group of shops or establishments, so decide to provide a
common canteen, then the same shall be permitted by the Chief Facilitator by an
order, subject to such conditions as may be specified in the order.

CHAPTER VI
FACILITATORS A.i'W THEIR POWERS Al~D FUNCTION
17 .(1) The State Government may, by notification, appoint such persons as Appointment of
Chief Facilitator and
possess the prescribed qualification to be Facilitator for the purposes of this Act F3cilil3tors and their
and may assign to them such local limits as it may think fit. powers.

Provided that the State Government may, by notification, appoint a Chief

Facilitator who shall, in addition to the powers conferred on a Chief Facilitator
under this Act, exercise the pO\vers of a Facilitator throughout the State.

(2) The State Government may prescribe a scheme for inspection of shops
and establishments which shall provide for generation of a web-based inspection
schedule.

(3) Every Facilitator and Chief Facilitator appointed under sub-section (1)
~5 of 1860. shall be deemed to be public servant within the meaning of section 21 of the Indian
Penal Code and shall be officially subordinate to such authority as the State
Government may specifY in this behalf.

(-1) Subject to such conditions as may be prescribed, a Facilitator may, within

the local limits for which he is appointed-
(i) advice the employers and workers and provide them such
mformation as may be considered necessary for complying with the
provisions of this Act effectively;
(ii) inspect the shop or establishment in accordance with the scheme
for inspection referred to in sub-section (2), and may-
(a) examine any person who is found in any premises of the
shop or establishment and whom, the Facilitator has reasonable cause
to believe, is a worker of the shop or establishment;
(b) require any person to give any information, which is in his
power to give with respect to the names and addresses of the persons;
(c) search, seize or take copies of such register, record of wages
or notices or portions thereof as the Facilitator may consider relevant
in respect of an offence under this Act and which the Facilitator has
reason to believe has been committed by the employer;
(d) bring to the notice of the State Government defects or abuses
not covered by the law for the time being in force; and
(e) exercise such other powers as may be prescribed:
Provided that no person shall be compelled under tllis section to answer any
question or give any evidence tending to incriminate himself.

(5) Any person required to produce any document or to give any information
required by a Facilitator under sub-section (4) shall be deemed to be legally bound
~5 or 1860. to do so within the meaning of section 175 and section 176 of the Indian Penal
Code.

8
2 of 197~ ( 6)The provisions of the Code of Criminal Procedure, 1973 shall, so far as
may be, apply to the search or seizure under sub-clause (c) of clause (ii) of sub-
section (4) as they apply to the search or seizure made under the authority of a
warrant issued under section 94 of the said Code.

CHAPTER VII
RECORDS AND RETURNS
18.(1) Every employer shall maintain such registers and records as may be Maintenance or
prescribed. register and records.

(2) The records may be maintained electronically or manually:

Provided that at the time of inspection by a Facilitator, a hard copy of such

records if demanded, shall be submitted duly signed by the employer.

19. Every employer of a shop or an establishment shall furnish an annual Anrual rerum.
return, in such form and manner (including electronic form), to such authority as
may be prescribed.

CHAPTER VIII
OFFENCES AND PENALTIES

20.(1) Whoever contravenes the provisions of this Act or the mles made Penalty for
contravention or
thereunder shall be punishable with fine which may extend to two lakh rupees and provisions of this
in the case of a continuing contravention, \virh a:1 additional fine which may extend Act.
to two thousand rupees for every day during which such contravention continues:

Provided that the total 2iTIOltnt of fine shall not txceed two thousand mpees
per worker empioyei

(2) If any person who has been convicted of any offence punishable under
sub-section (1) is again guilty of an offence involving a contravention or failure of
compliance of the same provision, be shall be punishable on a subsequent
conviction with fine which shall not be less than one lakh rupees but which may
extend to five Iakh mpees.

21. Save as is otherwise expressly provided in this Act, where an employer Penalty for
contravention of the
on being held guilty of contravention of any of the provisions of this Act or any provisions of this
rules made thereunder which has resulted in an accident causing serious bodily Act which resulted
in accident
injury or death of a worker, shall be punishable with imprisonment which may
extend to six months or with fine which shall not be less than two lakh rupees
which may be extended to five lakh rupees or with both.

22.(1) Whoever wilfully obstructs a Facilitator in exercise of any powers Penalcy for
obstructions refusal
conferred on him by or under this Act or refuses or wilfully neglects to afford the to provide register.
Facilitator any reasonable facility for making any inspection, examination, inquiry etc.
or investigation authorised by or under this Act in relation to a shop or an
establishment, shall be punishable with fine which may extend to two lakh rupees.

(2) Whoever wilfully refuses !o produce on the demand of a Facilitator any

register or other document kept in pursuance of this Act or the rules made
thereunder or prevents or attempts lo prevent or does anything which he has reason
to believe to prevent any pl!rson from appearing before, or being examined by, a
Facilitator acting in pursuance of his duties under this Act, shall be punishable
9
 with fine which may extend to two lakh rupees:

Provided that the total amount of fine shall not exceed tvio thousand rupees
per worker employed.

23.(1) No Court shall take cognizance of any offence punishable under this Cognizance of
offences
Act and the rules made thereunder unless a complaint in respect thereof is made by
the Facilitator within three months of the date on vvhich the alleged commission of
a
the offence came to the knowledge of the Facilitator and complaint is filed in that
regard thereby:

Provided that where the offence consists of disobeying a written order made
by a Facilitator, complaint thereof may be made within six months of the date on
which the offence is alleged to have been committed.

(2) No Court inferior to that of a Metropolitan Magistrate or a Judicial

Yfagistrate of the First Class shall try any offence punishable under this Act or the
rules made thereunder.

24.(1) Notwithstanding anything contained in the Code of Criminal Compounding of

2of1974 offences.
Procedure, 1973, any offence punishable under this Act, not being an offence
punishable with imprisonment only, or with imprisonment and also with fine, may,
on an application of the accused person, either before or after the institution of any
prosecution, be compmmded by a Gazetted officer, as the State Government may,
by notification, specify, for a sum of fifty per cent. of the maximum fine provided
for such offence, in the manner as may be prescribed.

l2) Nothing contained in sub-section (1) shall apply to an offence committed

by a person for the second time or thereafter v, ithin a period of five years from the
date-

(a) of commission of a similar offence which was earlier compounded;

(b) of commission of simila1· offence for which such person was earlier
convicted.

(3) Every officer refened to in sub-section (1) shall exercise the powers to
compound an offence, subject to the direction, control and supervision of the State
Government.

(-1) Every application for the compounding of an offence shall be made in

such fonn and manner as may be prescribed.

(j) Where any offence is compounded before the institution of any

prosecution, no prosecution shall be instituted in relation to such offence, against
the offender in relation to whom the offence is so compounded.

(6) Where the composition of any offence is made after the institution of any
prosecution, such composition shall be btought by the officer referred to in sub-
section (I) in writing, to the notice of the Court in which the prosecution is
pending and on such notice of the composition of the offence being given, the
person against whom the offence is so compounded shall be discharged.

(7) Any person who fails to comply with an order made by the officer
referred to in sub-section (1), shall be liablt: to pay a sum equivalent to twenty pl!r
to
cent. of the maximum fine provided for the offence, in addition to such fine.

(8) No offence punishable under the provisions of this Act shall be

compounded except tmder and in accordance with the provisions of this section.

CHAPTER IX
MISCELLANEOUS
25. No suit, prosecution or other legal proceeding shall lie against any public Piot~cuon of act1on
taken in good faith.
servant or any other person in the service of the Central Government or the State
Government, acting under direction of any such public servant, for any1hing in
good faith done or intended to be done in pursuance of the provisions of this Act or
of any rule made thereunder.

26. The State Government or any officer empowered in this behalf may, by Po11~r to grant
exemptions.
notification, exempt from the operation of all or any of the provisions of this Act
for any period it is considered, any shop or establishment or class thereof or any
employer or worker or class of employers or workers to whom this Act applies on
such terms and conditions as it may think fit.
27. The provisions of this Act shall be in addition to, and not in derogation Application of other
laws not b:med
of, the provisions of any other law for the time being in force.

28. (1) The State Government may, by notification, make mles for carrying Power to make
rules.
out the provisions of this Act.

(2) In particular and without prejudice to the generality of the foregoing

pm' er, such rules may provide for all or any of the following matters, namely:-

(a) the authority to which and the form and manner in which an
application shall be made under sub-section (2), the form of Labour
Identification Number under sub-section (3), and the manner of obtaining
Labour Identification Number under sub-section (4), of section 5;

(b) the measures to be taken by the employer relating to the health and
safety (including cleanliness, lighting, ventilation and prevention of fire) of
the workers under sub-section(!) of section 7;
(c) the matters to be provided by rules under sub-section (-/) of section
8·
l

(d) the condition subject to which the provisions of sub-section (1) and
(2) of section 8 shall apply to cettain class of workers under sub-section (5) of
that section;
(e) rate of higher amount of wages under section 9;

(f) the provisions of sufficient latrine and urinals under section 13 and
the provision of first-aid facility under section 15;

(g) the qualifications of Facilitators under sub-section (1), conditions

subject to which a Facilitator shall exercise his powers under sub-section (4),
and other powers exercisable by him under sub-clause (e) of clause (ii) of
sub-section (4), of section 17;
(h) the registers and records to be maintained by the employers under
91
 sub-section (I) of section 18;

(i) the form and manner (including electronic form) for furnishing of
annual return and the authority to such returns shall be furnished under
section 19;
(j) the manner of compounding of offences under sub-section (1), and
form and manner for making application for such compounding under sub-
section (4), of section 24;
(k) any other matter which is required to be, or may be, prescribed.

(3) Every ntle made by the State Government under this Act shall be laid, as
soon as may be after it is made, before each House of the State Legislature where it
consists of two Houses or, '>vhere such Legislature consists of one House, before
that House.
29.(1) If any difficulty arises in giving effect to the provisions of this Act, Power to remove
difficulties.
the State Government may, by order, published in the Official Gazette, make such
provisions not inconsistent with the provisions of this Act as may appear to be
necessary for removing the difficulty:
Provided that no order shall be made under this section after the expiry of
two years from the date of the commencement of this Act.
(2) Every order made under this section shall be laid, as soon as may be after
it is made, before each House of the State Legislature where it consists of two
Houses or, where such Legislature consists of one House, before that House.
State Act 1-io -or 30.(1) The ------- Shops and Establishments (Regulations of Employment Repeal and savmg.
and Conditions of Service) Act, ---- is hereby repealed.
(2) Notwithstanding the repeal of the Act under sub-section (1), anything
done or any action taken under the said Act shall, in so far as such thing or action
is not inconsistent with the provisions of this Act, be deemed to have been done or
taken under the provisions of this.
(3) The mention of particular matters in this section shaH not be held to
10 of 1897 prejudice or affect the general application of section 6 of the General Clauses Act,
1897 with regard to the effect of repeals