Background
The Bihar Shops and Establishments Act, 1953, originally enacted to regulate working conditions in shops and commercial establishments in the undivided state of Bihar, continues to apply to Jharkhand after its formation in 2000. It governs aspects such as working hours, wages, leave, employment of women and young persons, and conditions of work to ensure employee welfare. The Act is supplemented by the Bihar Shops and Establishment Rules, which provide procedural clarity on registration, record-keeping, and compliance requirements. In Jharkhand, this framework remains a key labour regulation for shops and establishments until replaced or amended by state-specific legislation.
Applicability
Applicable to all shops and commercial establishments operating within the State of Jharkhand. An establishment means:
an establishment which carries on any business, trade or profession or any work in connection with, or incidental or ancillary to any business, trade or profession and includes —
(i) administrative or clerical service appertaining to such establishment;
(ii) a shop, restaurant, residential hotel, eating house, theatre or any place of public amusement or entertainment; and 2[a society Registered under Societies Registration Act, 1860 (xxi of 1860) charitable or other trust, whether registered or not which carries on any business, trade or profession or work in connection with or incidental or ancillary there to, journalistic establishments, contractors or auditors establishments, educational or other institutions run for private gain and premises in which business of banking, insurance, stocks and shares brokerage or produce exchange is carried on.
Compliance Requirement under the Act in accordance with the Rules
The employer of the establishment is required to register under Shops & Establishment Act of respective state within prescribed time from the date of commencement of work in the said establishment.
Employer must apply within 30 days of these rules applying to the establishment, submitting Form I in duplicate to the Inspecting Officer for registration. The SG may extend the deadline. The signed application must include proof of registration fee via treasury challan or crossed postal order. Certificate of registration shall be issued in Form III. If the Inspecting Officer finds the application correct, the establishment is registered in Form II and a certificate in Form III is issued. For online applications, registration is deemed valid based on the employer’s details and the certificate is issued immediately online. Renewal must be applied online at least 30 days before expiry. Certificates remain valid for up to 10 years and until 31 December of the applied period.
Every employer shall display prominently the certificate of registration at the establishment.
Employer must notify the Inspecting Officer within 7 days of any change in details given in Form I using Form IV. The notice must include the current registration certificate and proof of fee payment.
Registration certificates are non-transferable. If an establishment is transferred, the employer must notify the Inspecting Officer within 14 days, submit transferee details in Form I, and surrender the certificate. After verification, a new Form III certificate is issued to the transferee.
Where a registration certificate is lost or destroyed, an application shall be made to the Inspecting Officer within seven days of such loss or destruction, for a duplicate copy which may be granted on payment of prescribed fee
No establishment shall on any day be opened earlier than 8 A.M. and closed later than 10 p.m. Provided that any customer who was being served or was waiting to be served at such closing hour in any establishment may be served in during the quarter of an hour immediately following such hour.
When they are conducted in an establishment two or more trades or business, any or which is of such a character that, if it was sole trade or business, therein conducted, the provisions of this section would not apply to that establishment shall, so far the conduct of that trade or business is concerned, be exempt from the operation of this section.
Section 8: No person may sell goods outside the opening and closing hours fixed under Section 7, except hawkers on footpaths or streets until 11 P.M. and newspaper hawkers.
No employee in an establishment shall work more than 9 hours a day or 48 hours a week. This excludes rest or meal intervals, which together must be at least 1 hour each day.
During any period of stock taking or making of accounts or any other purpose as may be prescribed any person other than a child or a young person, may be allowed or required to work a such establishment for any period in excess of hours fixed under this section subject to payment of overtime wages at the rate fixed in section 21, but total hours of overtime work shall not exceed 50 hours of overtime in a month. Provided further that advance intimation of at least 3 days in this respect has been given in the prescribed manner to the Chief Inspector or any other officer authorized by the State Government.
No employee shall work more than 5 hours continuously in a day without a rest interval of at least 30 minutes. Only one such rest interval is allowed during the employee’s working period in a day.
No employee in any establishment shall be required or allowed to work in such establishment for more than five hours continuously in any day unless he has had an interval for rest of at least half an hour: Provided that there shall not be more than one such interval for rest during the whole of the working period of any employee on any day.
The periods of work and intervals of rest of an employee in an establishment shall not be together spread over more than —
(i) in the case of child, eight hours in any day;
(ii) in the case of a young person, ten hours in any day;
(iii) in the case of any other employee, twelve hours in any day
Every employee in an establishment shall be allowed in each week of holiday of one whole day
No deduction shall be made from the wages of any employee in an establishment on account of any day on which it has remained closed as a holiday or on which an employee has been on his weekly holiday and if an employee is employed on daily wages, he shall nonetheless be paid the daily wages of the day on which such establishment remains closed or on which the employee is on his weekly holiday unless he is absent on the day preceding such day.
Employees must receive paid holidays on Independence Day, Republic Day, and Gandhi Jayanti, plus up to five additional paid festival holidays as declared by the State Government. If required to work on these days, they must be paid double their normal hourly wages.
Every employer must display a notice in Form VII showing the weekly holiday for employees before work ends on the Saturday preceding that week. A copy of the notice must also be sent to the Inspecting Officer within two days of displaying it.
Every employer shall exhibit in his establishment a notice in Form VII specifying the day or days of the week on which the employees shall be given a holiday. The notice shall be exhibited before the persons employed cease work on Saturday immediately preceding the week during which it will have effect, and a copy of every such notice shall be delivered at the office of the Inspecting Officer within two days of its display in the Establishment.
The employer shall maintain a service card in Form XXI in triplicate. A copy of this Form after necessary entries made therein shall be furnished to employees, the second copy shall be delivered at the office of the Inspecting officer within a week of his first employment in the establishment and the third copy shall be retained by the employer for the record.
Every employer shall exhibit in this establishment a notice in Form VIII specifying the period of work of each and every employee of the establishment. A copy of the notice shall be delivered at the office of the Inspecting Officer within two days of its display in the establishment.
Every employer shall maintain Leave With Wages Register in Form IX.
The Leave with Wages Register shall be preserved for a period of three years after the last entry in it and shall be produced before the Inspecting Officer on demand.
Children below 14 years of age shall not be employed or allowed to work in any establishment covered under this Act.
No young person or woman shall be required or allowed to work in any establishment before 8 A.M. or after 10 P.M. under this Act.
The State Government may relax or modify work-hour regulations for women in specific establishments if deemed unreasonable, ensuring that safety and welfare considerations are prioritized.
No young person shall be allowed to work as an employee in any establishment to which this Act applies for more than seven hours in any day or forty-two hours in any week. Further, no young person shall be required or allowed to work in such establishment for more than four hours continuously in any day unless he has an interval for rest and meals of at least one hour.
An employee who works 240 days or more in a calendar year and is not involved in an illegal strike is entitled in the following calendar year to leave with wages at the rate of 1 day for every 20 days worked in the previous year.
For computing 240 days of work for leave eligibility: lay-offs, lockouts, maternity leave (up to 12 weeks), and prior-year earned leave shall be counted as days worked but but he shall not earn leave for these days. Leave granted excludes holidays. Employees starting mid-year get leave if they work at least two-thirds of remaining days. Those employed more than 120 days get leave proportionate to 240/365 days. Fractions of leave for a half a day or more count as a full day; less than half a day is ignored.
An employee may apply in writing for leave at least 15 days in advance and take it in up to three installments. Leave cannot be refused without written reasons. If refused unfairly, the employee may appeal to the prescribed authority for compensation.
If earned leave of 45 days or more is refused, the employee is entitled to wages for the refused leave period, in addition to normal wages. The leave balance is reduced by the number of days for which payment is made.
If an employee entitled to leave has unused leave at termination or resignation, the employer must pay wages for the unavailed leave. Payment must be made within two working days after termination or by the next pay day if the employee resigns.
If leave with wages is needed for illness and the employee cannot apply within the usual time, it must still be granted, and wages paid within 15 days. Unused leave is not counted when calculating notice periods for discharge or dismissal.
In addition to other leave, every employee is entitled to 12 days of casual leave with full pay and 12 days of sick leave on half pay in each calendar year with a medical certificate. These leaves cannot be accumulated.
Care-takers, guards, and watchmen with 12 months of continuous service are entitled to 45 days of full-pay leave for each completed year, in addition to other leave under Section 16 and this section.
For leave under Section 16, an employee must be paid the daily average of full-time earnings for the previous month, excluding overtime and yearly bonus but including attendance, efficiency, incentive bonuses, dearness allowance, and concessional benefits.
For earned leave, an employee may receive advance wages for half the leave period plus the preceding wage period; the remaining half is paid with the first wage period after returning. Sick leave wages are paid with the first wage period after resuming work. Cash value of benefits from concessional sales is computed using retail prices from the nearest market, following State Government directions.
A register of wages and overtime payment shall be maintained by every employer in Form X
Every employer is responsible for paying all wages to employees as required under this Act.
Every employer shall fix period in respect of which such wages shall be payable. No wage period shall exceed one month.
Employees working over 9 hours a day or 48 hours a week must be paid overtime at twice the ordinary wage rate (basic wages plus allowances, excluding bonus).
Explanation. — For the purpose of this section, the expression “ordinary rate of wages”, in relation to an employee means the basic rates of wages and such allowances as the employee is for the time being entitled to but does not include a bonus.
Penalty and Punishment
Section 34: Penalties. —Any employer who contravenes any provisions of this Act or any rule or order made thereunder shall, if no other penalty is provided for the offence, be punishable with fine which may extend to five thousand rupees for the first offence and to ten thousand rupees for every subsequent offence after the first conviction.
U/s 35: Penalty whether the employer is a firm or company.—If the person contravening any provision of this Act or a rule or order made thereunder is a company or a partnership firm every director, partner, manager or secretary thereof shall, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention, be deemed to be guilty of such contravention.
Rule 7: Late applications for registration or amendment.- – If an application for registration of an establishment or amendment of registration certificate is not received by the Inspecting Officer within time specified in the foregoing rule the establishment shall be registered or the registration certificate shall be amended, as the case may be, on payment of a fee calculated in the following manner. The process of Registration or amendment shall be completed and for the delay of every subsequent 3 months or part thereof 50% additional fee on the prescribed original fee shall be payable in one installment.
Rule 8: Penalty for making incorrect statement.- If any statement made in Form I or in Form IV is found to be incorrect, the employer shall be punished with fine which may extend to one hundred rupees.
Section 32: Penalty for obstructing Inspecting Officer, etc.—Any person who voluntarily obstructs an Inspecting Officer in the exercise of any power conferred on him by or under this Act or any person lawfully assisting an Inspecting Officer in the exercise of such power or who fails without sufficient cause to comply with any lawful direction made by an Inspecting Officer shall be punishable with imprisonment which may extend to six months or with fine which may extend to five thousand rupees, or with both. This penalty is applicable only when Inspector is obstructed in exercise of his powers and company shall note the sane.
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