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Abhay Nevagi & Associates

Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 (Notification of September 2017)

Through an official Notification dated September 7th, 2017, the Government of Maharashtra has introduced the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017. At its outset on the 20th of December 2017, the new Act shall repeal the earlier Maharashtra Shops and Establishments Act of 1948. And shall prove extremely beneficial for both employers as well as workers considering the fact that there are plenty of provisions to favor both these parties.

SYNOPSIS:

The Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 is a progressive piece of legislation for the state of Maharashtra in more ways than one.

Firstly, the Act clearly provided a leeway to new entrants in the industry, employing less than 10 workers, preventing them the need to comply with the provisions of the Act.

An endeavor has been made by the legislature to make life simple for establishment owners by providing easy online method for registration of establishments and prescribing increased time limit for such registration.

The Act also has provisions wherein it has been made the mandatory duty of the employer to ensure the safety and health of all employees in general. Special provisions have been incorporated to ensure the safety of women working beyond prescribed office timings specifically.

The Act has numerically increased the number of holidays available to employees in comparison to what was available under the earlier legislation.

Finally, the as per the decision of the Legislature of Maharashtra on the Act, it allows for shops and establishments to remain open all day in 3 shifts. This again shall be a welcome change considering shops rendering essentials such as medicine, food etc. Such an allowance has a restriction though, since it is not applicable for bars, pubs, wine shops and discotheques.

Hence one finds that the new legislation has benefits for both employers as well as workers.

THE CHANGE:

There are quite a few significant and major changes that have been between the 1948 Act and the 2017 Act are as follows: –

  • Difference in Applicability of the Two Acts:

Whereas the 1948 Act was applicable to all establishments, the 2017 Act is applicable to establishments employing 10 or more workers. For establishments employing less than 10 workers, the Act makes it mandatory for such establishments to intimate the “Facilitator” about the commencement of their business.

  • Difference in the Scope of the Definition of “Employer”:

The definition of an ‘employer’ has been expanded under the 2017 Act. The definition under the 2017 act includes ‘partners’ (in case of associations), ‘directors’ in case of companies and designated authorities in case of Government establishments.

  • Difference in rules relating to Registration of Establishment:

Chapter 2 of the New Act deals with ‘registration of establishments’. It prescribes a specific mode for the registration of establishments. It mandates employers to submit an Online Application within 60 days of the commencement of the 2017 Act or commencement of business. Following this, the Authority under the Act, i.e. the Facilitator verifies applications thus received. Only after the acceptance of such application is the employer provided with a Labour Identification Number (LIN) by the facilitator. The earlier Act of 1948 in this regard, neither had the Online Registration System, and it also prescribed the time of only 30 days beyond the commencement of business to submit such applications.

Such Certificate of Registration, as issued by the Facilitator, issued under the 2017 Act remains valid for a period between 1 to 10 years in accordance to the request of the employer. The validity of the Certificate of Registration under the precious Act was for a period between 1 to 3 years.

Also, unlike in the previous Act, where the time prescribed for renewal of certificate was 15 days, the same has been extended to 30 days under the new Act.

Another change in this regard in the 2017 Act is regarding the cancelation of registration by Facilitator in cases wherein Registration was obtained through fraud or misrepresentation.

  • Provisions relating to Women Safety:

The 2017 Act has provisions relating to the prevention of discrimination against women relating to recruitment, training, transfer or wages. It also prescribes the time beyond which women workers are not allowed to work and the conditions owing to which an exception to such provision can be made.

For instance, the new Act clearly mentions that in cases women are supposed to work beyond the prescribed time of 7 am to 9:30 pm, it shall be the duty of the employer to ensure the safety of such female employees, prevent against sexual harassment and organize for their conveyance.  Such conditions were not present in the earlier Act of 1948.

  • Difference in provisions relating to leaves:

Chapter 4 of the new Act deals with ‘leave with pay and payment of wages’. Following are the key highlights mentioned therein:

  1. All workers are entitled to 8 days of casual leave in a year;
  2. A maximum of 45 earned leaves ca be accumulated by any worker;
  3. Every worker who has worked continuously for 240 days shall receive paid leave by the calculation of 1 day per 20 days of work in the previous year.

  • Provisions relating to maintaining registers:

The new provisions allow employers to maintain registers electronically. This move shall be greatly beneficial for employers considering the fact that it is efficient, less time consuming and above all more durable than maintaining physical registers.

  • Provisions relating to Health and Safety:

According to the provisions of the new Act, it is the duty of the employer to take measures to maintain the health and safety of workers and also prevent them from any type of accidents.

Stringent provisions relating to cleanliness, lighting, canteen, ventilation, first-aid, fire prevention etc. have been introduced in the new Act.

  • FACILITATORS:

Under the earlier Act of 1948, ‘Inspectors’ were given the duty to enforce the provisions of the Act but after the amendment Act in 2017, ‘Facilitators’ as defined u/s 28 of the Act have been given the responsibility to ensure that the Act is enforced.

  • Change in provisions relating to Penalties:

Chapter 7 of the new Act deals with the ‘Offences and relevant Penalties. It prescribes greater penalties for offences in comparison to the earlier Act.

For instance, the new Act prescribes penalty up to the sum of Rs. 1,00,000/- (Rupees One Lakh Only) unlike the previous Act wherein penalty that could be imposed was between Rs. 1000/- to Rs. 5000/-.

For continuing offences under the new Act, a daily penalty of Rs. 2000/- (Rupees Two Thousand Only) can be charged.

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