5 March 2018

NEW MAHARASHTRA SHOPS AND ESTABLISHMENTS ACT 2017 AND RULES

The Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 (New Act) was published in the Official Gazette on 7 September 2017 and came into effect on 19 December 2017, thereby repealing the Bombay Shops and Establishments Act, 1948 (Old Act). Pursuant to the New Act, the Government of Maharashtra published the draft Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Rules, 2018 (Rules) for public comment on 2 February 2018.

The New Act and Rules have brought about significant changes in the regulations governing the running of shops and establishments by its employers which are as follows:

• Online Registration and Maintenance of Registers: Under the New Act, the registration of a shop or establishment has to be done online and the registers prescribed under the New Act can be maintained electronically. The Old Act did not provide for online maintenance of registers by the shop or establishment.
• Opening and Closing Hours of Establishment: Under the New Act, the State Government may fix the hours for opening and closing of different classes of establishment or for different areas and for different periods. The Old Act prescribed fixed timings for the opening and closing of shops and establishments.
• Working Hours for Women: Under the Old Act, women workers were prohibited from working in any establishment after 9.30 pm. The New Act and Rules provide that women workers may consent to work between 9.30 pm. and 7.00 am. in any establishment where the employer ensures adequate protection of their dignity, safety, protection from sexual harassment and their transportation from the establishment till their residence.
• Accumulated Leave and Holidays: Under the New Act, every worker is entitled to accumulate earned leave for upto 45 days as compared to the Old Act which allowed only 42 days accumulated leave. Further, the paid festival holidays have increased from 4 to 8 under the New Act.
• Overtime Wages: Under the New Act, if a worker is required to work beyond 9 hours a day or 48 hours a week, he is entitled to overtime wages at the rate of twice his ordinary wages in respect of the overtime work. The Old Act did not provide for such overtime wages.
• Creche Facility: The New Act provides for the maintenance of a suitable room as a creche for the children of workers in an establishment where 50 or more workers are employed. The Old Act did not provide for the provision of such creche facility.
• Health, Safety and Welfare Committee: Under the Rules, every establishment employing 100 or more workers, must constitute a health, safety and welfare committee to examine accident prone spots in the premises, conduct health care or wellness camps, conduct recreational or sports activities and other functions as prescribed under the Rules. The Old Act and rules did not provide for such committee to be formed in a shop or establishment.
• Managerial Functions: Under the Rules, every employer shall intimate the Facilitator appointed in terms of the New Act of the name, designation and brief nature of duties of persons discharging managerial functions such as power to sanction leave, award increment, take disciplinary action, suspend workers etc.
• Latrine and Urinal Facility: Under the Rules, every employer must provide neat and clean latrine and urinal facilities for men and women workers separately which must be well ventilated and lighted as well as safe for women workers and also have proper provision of water supply and flushing of waste. Such facilities were absent in the Old Act and rules.
• Compounding of Offences: The New Act provides for compounding of offences which are punishable with fines, by the Compounding Officer appointed by the State Government. The Compounding Officer must pass a detailed order within 7 days of receipt of the application. The fees for compounding is a minimum of 75% of the maximum fine specified for such offense under the New Act.
• Increase of Fines: The maximum amount of fine was Rs 15,000 for offences under the Old Act. However, under the New Act, the fines for contravention have been increased and may be upto a maximum amount of Rs 5,00,000.

MHCO COMMENT:

The New Act along with the Rules have brought about progressive developments in the regulation of shops and establishments in Maharashtra by inter alia placing obligations on employers to ensure safety for women workers who wish to work during night shifts and by making the employer responsible for providing creche facilities. Further, the New Act and Rules also provide for digitalization of the Registers to be maintained by the shop or establishment and provides the employers with a second chance by permitting them to apply for compounding of offences. The reformist provision under the New Act is the flexibility in the opening and closing hours of different classes of establishments which may be decided by the Government and such facility may benefit the public as well. However, the present Rules have only been published for public comments and only upon its notification, will its benefit pass on to the public at large.

The views expressed in this update are personal and should not be construed as any legal advice. Please contact us directly on +91 22 40565252 or legalupdates@mhcolaw.com for any assistance