SUMMARY AND COMPARATIVE STUDY OF SHOPS AND COMMERCIAL ESTABLISHMENT

LEGISLATIONS IN DIFFERENT STATES OF INDIA

1. Registration of Establishments

 In Karnataka, registration is mandatory under The Karnataka Shops and

Commercial Establishments Act 1961 . For that purpose, employer of each
establishment shall send to the Inspector (appointed under Section 26), a
statement in prescribed form i.e Form A together with such fees as provided in
Schedule I of the Karnataka Shops and Commercial Establishment Act 1961. The
statement shall contain :
(a) The name of the employer and the manager, if any
(b) The postal address of the establishment
(c) The name, if any, of the establishment
(d) Any other particulars as may be prescribed.

On receipt of the statement, if the Inspector is satisfied about the

correctness of the statement ,register the establishment and issue a
registration certificate. He can refuse registration for reasons recorded.
However, if he did not communicate his refusal to the establishment within
30 days from date of application then the establishment shall be deemed to
be registered. The registration certificate is valid for 5 years and shall be
renewed before its expiry on payment of such fees as may be prescribed.

 In Tamil Nadu, under The Tamil Nadu Shops and Establishments Act 1947 there is
no provision with regard to registration of establishments and issuance of
registration certificate. However, a bill for Tamil Nadu Shops and Establishments
(Amendment) Act 2021 has been introduced by The Tamil Nadu Labour
Department to further amend the registration provisions as per The Tamil Nadu
Shops and Establishments (Amendment) Act, 2018 and include seating facilities
in the establishments.
 In UP, under Uttar Pradesh Shops and Establishments Act 1962 every owner of a
shop or establishment shall within 3 months of the commencement of such
business or the Act whichever is later, apply to Chief Inspector for registration.
Every application shall in such form and accompanied by such fees as may be
prescribed. On receipt of application, the Chief Inspector on being satisfied
register the shop or establishment in the register maintained by him (under
 Section 4A) and issue a certificate of registration to the owner in such form an
such manner as prescribed. The registration certificate granted shall be valid for
such period as may be prescribed and shall on an application being made on that
behalf and upon payment of the prescribed fees, be renewal from time to time
by Chief Inspector for such further period as may be prescribed. The Act also
provides a provision for cases when registration certificate is lost, destroyed or
torn or is deflated or otherwise become illegal, in such cases the Chief Inspector,
shall in manner prescribed and on payment of prescribed fee, issue a duplicate
registration certificate.

2. Working Hours, Overtime, Overtime wages and Spread over Provisions

TABLE TO DEMONSTRATE STATE-WISE PROVISIONS

KARNATAKA

Normal Working Hours Nine hours in a day and forty eight hours in a
week
Interval For Rest After five hours of work, interval for rest of at
least one hour
Maximum Overtime Hours Fifty hours in a quarter
Spread over Hours Twelve hours in a day
Rate of Overtime Wages Twice the rate of normal wages
Normal Wages = Basic wages+ Allowances- Bonus

TAMIL NADU

Normal Working Hours Eight hours in a day and forty eight hours in a
week
Interval For Rest After four hours of work, interval for rest of at
least one hour
Maximum Overtime Hours Six hours in a week
Spread over Hours Twelve hours in a day
Rate of Overtime Wages Twice the ordinary rate of normal wages
Ordinary Rate of wages- Rate of wages calculated in manner prescribed.

UTTAR PRADESH

Normal Working Hours Eight hours in a day

Interval For Rest After five hours of work, interval for rest of
half and hour
Maximum Overtime Hours Two hours in a day and fifty hours in a quarter
Spread over Hours Twelve hours in a day
Rate of Overtime Wages Twice the ordinary rate wages
Quarter= Period of three consecutive months beginning on 1st Jan, 1st Apr, 1st Jul, and 1st Oct

3. Wages and Compensation & Deductions

 KARNATAKA : Section 21 and 22 of The Karnataka Shops and Commercial

Establishments Act 1961 provides that subject to provisions of this act, The
Payment of Wages ACT 1936 as well as The Workmen’s Compensation Act 1923
shall apply to all or any class of employees and their employers to which the
Karnataka Shops and Commercial Establishment Act applies.
 TAMIL NADU : As per Tamil Nadu Shops and Establishment Act 1947, an
employer has the responsibility to pay wages and fix wage period (which should
not be more than a month).
Any person working overtime is entitled to twice the ordinary rate of wages,
with respect to the extra work he had done.
Wages of every person employed shall be paid before the expiry of fifth day after
the last day of wage period in respect of which wages are payable.
In case when the employment is terminated the wages earned by such person
shall be paid before expiry of second working day from day the employment is
terminated.
The State government can exempt an employer from operation of this section.
All payment of wages shall be made on a working day and wages have to be paid
in current coins or currency note or both.

DEDUCTIONS UNDER THE ACT

(a) Fines (f ) For recovery of advances and
overpayment of wages
(b) For absence from duty (g) For income-tax payable
(c) For damage to or loss of goods (h) deductions required to be made by
expressly entrusted to an order of a court or a competent
employed, authority
Or for loss of money
(d) For house accommodation (i)For subscription to and repayment
supplied by employer of advances from any provident fund
(to which PF Act 1952 applies.)
(e) For amenities & services (k) For written authorization of the
supplied by employer employed person in furtherance of
any saving scheme approved by the
 State Government for purchase of
securities
(j)For payment to co-operative societies
or to a scheme of insurance maintained
by Indian Post Office or by an insurance
company approved by state
government

 UTTAR PRADESH:

According to UP Shops and Establishment Act 1962, an employer is obligated

to fix a wage period (not exceeding 1 month) at expiry or in respect of which
wages shall be paid to employees.

Remuneration due to an employee in lieu of availed period of leave and

wages earned by him shall be paid-

(I) In case of termination by or on behalf of employer:

Before the expiry of second working day after such termination.
(II) In case of termination of employment by employee:
On or before the next pay day

An employee on earned leave shall on demand be given: Advance payment

of wages for half the period of leave + Wages for wage period preceding such leave.

For remaining half period of such leave : Wages shall be payable to him along with wages for
first wage period after he resumes the duty.

No deductions to be made except to such extent and manner prescribed.

No fines in excess of 3% of wages payable to any employee for any wage period shall be
imposed on him by employer. Employer shall maintain a register with respect to fines and
recoveries. Fines recovered from employees must be utilized for their benefit and as approved
by the authority empowered in this behalf by State Govt.

In cases where wages of employee is not paid under the Act, then it shall be recoverable in the
manner as provided in Payment of Wages Act 1936.

4. Employment of Women and Children

 KARNATAKA :
 The Karnataka Shops and Commercial Establishments Act 1961, provides
for provision related to employment of women and children under
Chapter VI (in section 24 and 25).
Section 24 prohibits employment of children and Section 25 prohibits
employment of young persons and women working as an employee or
otherwise in any establishment during night.

 TAMIL NADU :

The Tamil Nadu Shops and Commercial Establishments Act 1947,

provides for employment of women and children under Chapter IV (from
Section 17-19).
Section 17 provides that no child shall be required or allowed to work in
any establishment.
Section 18 on the other hand, provides that young person shall be
required to work only between 6a.m and 7p.m.
Section 19 provides for daily and weekly hours of work for young persons
as seven hours in a day and forty-two hours in a week. It also says that
such person shall not be allowed to do overtime.

 UTTAR PRADESH:

Chapter V (from section 21-28) of the Uttar Pradesh Shops and

Commercial Establishments Act 1962, provides for provisions related to
Employment of women and children.
Each section have been briefly discussed below:
Section 21 prohibits employment of children except as an apprentice as
may be notified by the State Government.
Section 22 prohibits employment of children and women during night.
Section 23 prohibits employment of women during period of six week
following the day on which she had her delivery.
Section 24 provides that a pregnant women on providing a clear seven
day notice can be relieved from her duty by the employer for a period not
exceeding 6 week preceding the expected date of delivery. (sub section1)
On receipt of notice the, the employer shall permit such employee to
remain absent from duty for six week till her delivery date
 If required ,he can also get the employee examined at his cost by a lady
doctor, if she so desired or by a qualified medical practitioner or a
midwife. [sub section 3(a)]

Where Section 25 provides for Maternity leave, Section 26 provides for

Maternity Benefit that the employee is entitle to receive.
Section 27 of the Act provides for an addition of Interval For Rest to two
breaks of half an hour each with regular interval for rest for a woman
employee during the period she is nursing her child.
Section 28 prohibits an employer to discharge a female employee from
service who is on her absence on duty.
In case she is discharged from service , she shall not be deprived of
maternity benefits she is entitled to get.

5. Enforcement and Penalties

 KARNATAKA
(I) Under Chapter VII Section 26 of the Karnataka Shops and
Commercial Establishments Act provides for appointment of such
person or such class of persons as inspectors and assistant
inspectors by the state government as it thinks fit.
The state government can appoint public officers as inspectors or
assistant inspector as it thinks fit.
It can specify their powers, they can exercise.
Section 27 of the Act provides for powers and duties of an inspector.
Section 28 provides that every person appointed as an Inspector under
Section 26 shall be deemed to be a public servant under Section 21 of
Indian Penal Code 1860.
Section 29 provides that every employer on demand by the Inspector
produce for all register, notices, records he is suppose to maintain under
the Act

(II) The provision regarding penalties is provided under Chapter VIII of

the Act.
It has been summarized below through a table below:

On contravention of any of the provisions of For first offence one thousand for second
section 4-16, 25 and 39 subsequent offence two thousand
On contravention of any of the provisions of Punished with fine extending to two hundred
section 8,17,29,34
On contravention of section 24
On willfully obstructing an Inspector
and fifty rupees.
For first offence- imprisonment for a term not
less than 3 months but can extend to 6
months or fine not less than Rs.10,000 which
can extend to Rs.20,000
For second subsequent offence- Imprisonment
for a term not less than 6 months but which
can extend to 1 year.
Fine extending to Rs.500

 TAMIL NADU

Similar to Karnataka’s Shop and Establishment Act, the Tamil Nadu Shops
and Commercial Establishments Act 1947, provides for-
(i) Appointment of Inspectors under Section 42 if Chapter VIII of the
Act.
(ii) Powers and duties of Inspectors under section 43
(iii) Section 44 provides that every inspector shall deem to be a public
servant under Section 21 of IPC 1860.
The Penalties and Offences has been explained through the table
below:

For contravention of provisions For first offence Rs.5000

of section 7-11, 13-23,25,26,29-
41 and 47
For failure to comply with
provisions of section 45A
For second subsequent offence-
Rs. 10,000
Imprisonment for a term
extending 6 months or fine or
both.