Shops and Establishments Act - Telangana

Telangana Shops and Commercial Establishments Act, 1988

Background
The Telangana Shops and Commercial Establishments Act, 1988, along with its Rules of 1990, applies to all shops and commercial establishments in designated areas within Telangana. This legislation aims to safeguard employee rights by regulating various aspects of employment. It sets forth guidelines for the payment of wages, terms of service, working hours, rest intervals, and overtime. Additionally, it dictates the opening and closing times of establishments, closed days, holidays, and leave entitlements, including maternity leave and benefits The Act also establishes standards for working conditions, prohibits the employment of children in certain capacities, and mandates the maintenance of employment records, thereby ensuring a structured and fair work environment.

Various compliances required under Telangana Shops and Commercial Establishments Act, 1988 read with Telangana Shops and Establishments Rules, 1990 are as under:

Opening and closing hours of shop (Section 7(1)): No shop shall on any day be opened earlier or closed later than such hour as may, after previous publication, be fixed by the Government by a general or special order in that behalf.

Provided that, any customer who was being served or was waiting to be served in any shop at the hour fixed for its closing may be served during the quarter of an hour immediately following such hour.

Daily and weekly hours of work in shops (Section 9): No employee shall be allowed to work in any shop for more than 8 hours on any day and 48 hours in any week.
Any employee working in excess of the hours specified above shall be paid over-time wages, subject to a max. period of 6 hours continuously without break.

Spread over periods of work in shops (Section 11): The periods of work of an employee in a shop shall be so arranged that along with his intervals for rest, they shall not spread over for more than twelve hours in any day. Provided that, where an employee works on any day for the purpose of stock-taking and preparation of accounts, the spread over shall not exceed fourteen hours in any such day on payment of over-time wages.

Notice of weekly holiday (Section 12(4)): The weekly day on which a shop is closed shall be specified by the employer in a notice prominently exhibited in a conspicuous place in the shop.

Opening and closing hours (Section 15(1)):No establishment shall on any day be opened earlier, or closed later, than such hour as may, after previous publication, be fixed by the Government

Spread over Periods of Work (Section 18): The periods of work of an employee in an establishment shall be so arranged that along with his intervals for rest, they shall not spread over for more than twelve hours in any day: Provided that, where an employee works on any day for the purpose of stock-taking and preparation of accounts, the spread over shall not exceed fourteen hours in any such day on payment of over-time wages.

Children not to work in Establishment (Section 20): No Child shall be required or allowed to work in any establishment

Daily and weekly hours of work for young persons (Section 22): No young person shall be required or allowed to work in any establishment for more than 7 hours in any day and forty-two hours in any week nor shall such person be allowed to work overtime.

Maternity Leave (Section 24): The periods of absence from duty in respect of which a women employee is entitled to maternity benefit under section 25, shall be treated as authorized absence from duty, and the women employee shall be entitled to maternity benefit, but not to any wages for any of those periods.

Payment of Maternity Benefit (Rule 10):

1. Payment of Maternity Benefit shall be at the same rate of daily, weekly or monthly wages last paid. In the case of piece rate employees, the rate of maternity benefit shall be on the basis of the average earning of one month or wages drawn on the last working day whichever is higher.
2. Benefit to be paid at any time not later than one week after receipt of intimation in writing about the date of her delivery. Provided that if woman dies during this period, that maternity benefit shall be payable only for the days up to and including the day of her death.
3. In case of miscarriage, the woman employee shall on production of a certificate granted to that effect by a Registered Medical Practitioner, be entitled to the maternity benefit for a period of six weeks immediately following the date of her miscarriage.
4. Payment of Maternity benefit to be made to the woman employee concerned or to a person authorized by her in writing. In the case of her death, the same shall be payable to her legal heirs.
5. No woman employee having more than two children shall be eligible for maternity benefit.

Ventilation (Section 27): The premises of every establishment shall be ventilated as provided for in the laws relating to the municipalities, gram-panchayats or other local authorities for the time being in force.

Safety of employees where machineries are used (Section 28(2) Rule 13):

(1) Every dangerous part of machinery in an establishment other than a shop shall be securely fenced by safeguards of substantial construction which shall be kept in position while the part of machinery is in motion or in use.

(2) In every establishment where manufacturing process is carried on with the aid of electric power, suitable devices for disconnecting the power supply during the emergencies from running machinery shall be provided and maintained.

(3) No employee, with loose fitting clothes on, shall be allowed or made to work near the moving machinery or belt and the tight fitting clothes for the purpose shall be provided by the employer.

Encashment of leave (Section 30(1), (4)): Every employee who has served for a period of not less than two hundred and forty days during a continuous period of twelve months in any establishment shall be entitled for encashment of eight days of leave with wages that has accrued to him under sub-section (1) during the subsequent period of twelve months.
The employer shall pay to the employee the wages for the leave so encased by the employee within a week of receipt of the application for such encashment from the employee.

Pay during leave and holidays (Section 32): Every employee shall, for the period of the leave allowed under sub-sections (1) and (5) of section 30 or the holidays allowed under section 31, be paid at a rate equivalent to the daily average of his wages for the days on which he actually worked during the preceding month exclusive of any earning in respect of overtime.

Fixation of wage period by employer (Section 36): Every employer shall fix periods in respect of which such wages shall be payable. No wage-period shall exceed one month.

Payment of wages by 5th day after the wage period (Section 38(1)): The wages of every employee shall be paid before the expiry of the fifth day after the last day of the wage period in respect of which the wages are payable.

Payments of wages shall be made on a working day. (Section 38(4)): All payments of wages shall be made on a working day.

Display of Notice of Acts/Omissions (Section 41(2), Rule 17(i)(d): The employer shall display at or near the main entrance of the establishment or at a conspicuous place a copy in English and in Telugu of the list of acts/omissions as approved by the Chief Inspector.

Notice for termination of services of an employee (Section 47(1), Rule 20): No employer shall, without a reasonable cause terminate the service of an employee who has been in his employment continuously for a period of not less than six months without giving such employee at least one month’s notice in writing or wages in lieu thereof and in respect of an employee who has been in his employment continuously for a period of not less than one year, a service compensation amounting to fifteen days average wages for each year of continuous employment: Provided that every termination shall be made by the employer in writing and a copy of such termination order shall be furnished to the Inspector having jurisdiction over the area within three days of such termination.

Notice of Closure of Business in Telangana (Section 3(5), Rule 6 (3)): The employer shall, within fifteen days of the closure of the establishment, give intimation thereof in writing to the Inspector, who shall, on receipt of such intimation, remove the name of the establishment from the register of establishments and cancel the registration certificate.

Notice containing abstracts of the Act and Rules (Rule 29(4)): Every employer shall exhibit in his establishment a notice containing such abstracts of the Act and Rules as the Government may direct.
Daily and Weekly Hours of Work (Section 16):
- No employee shall be allowed to work in any establishment for more than 8 hours on any day and 48 hours in any week.
- Any employee working in excess of the hours specified above shall be paid over-time wages, subject to a max. period of 6 hours in a week.
- For the purpose of stock-taking and preparation of accounts, an employer may, with the previous intimation to the Inspector, require or allow any employee to work in an establishment for not more than any six days in a year in excess of the period fixed in sub-section (1), on payment of over-time wages; so however, that the excess period shall not in aggregate, exceed twenty-four hours.
Interval for Rest (Section 17): No employee in any establishment shall be required or allowed to work therein for more than five hours in any day unless he has had an interval for rest of at least one hour. Provided that the Chief Inspector may, in the case of an establishment whose daily hours of work are less than eight hours, reduce interval for rest to half-an-hour on an application made by the employer, with the consent of the employees.

Government of Telangana has exempted all Commercial Establishments (other than shops) from applicability of Section 16,17 of Act under Ease of Doing Business subject to the following conditions

1) Maximum daily working hours for an employee shall not exceed 10 hours, and the weekly limit is 48 hours. Overtime wages are mandatory for hours worked beyond 48 in a week.
2) No employee shall work more than 6 hours in a day continuously without a minimum 30-minute rest break.
3) The total spread of work including the rest interval shall not exceed 12 hours in a day.
4) Overtime work beyond 48 hours a week is allowed up to a maximum of 144 hours per quarter of a year, with appropriate overtime pay.
Any violation of these conditions may lead to revocation of the exemption without prior notice.

Shops and Establishment Registration Certificate (Section 3, Rule 3 of Telangana Shops and Establishments Rules, 1990)

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.

Daily and Weekly Hours of Work in Commercial Establishment in Telangana (Section 16)

1. No employee shall be allowed to work in an establishment for more than 8 hours on any day and 48 hours in any week.
2. Any employee working in excess of the hours specified above shall be paid over-time wages, subject to the prescribed limitations.
3. For the purpose of stock-taking and preparation of accounts, an employer may, with the previous intimation to the Inspector, require or allow any employee to work in an establishment for not more than any six days in a year in excess of the period fixed in sub-section (1), on payment of over-time wages; so however, that the excess period shall not in aggregate, exceed twenty-four hours.

Compliance with Weekly Holidays by employer in Telangana (Section 19)

1. Every employee in any establishment shall be allowed in each week a holiday of one day.
2. Notice in Form XXIV for weekly holiday shall be exhibited.
3. Employees shall be paid at rate equivalent to daily average of his wages for the days of holiday

Compliance with Maternity Benefits to Women Employees in Telangana (Section 24)

Any woman employed for atleast 6 months preceding date of delivery with same employer is entitled to receive maternity benefit for 6 weeks immediately preceding date of delivery and 6 weeks following day of delivery

·Cleanliness of the Commercial Establishment in Telangana (Section 26, Rule 11)

The premises of every establishment shall be kept clean and free from effluvia arising from any drain or privy or other nuisance and shall be cleaned at such times and by such methods as prescribed in Rule 11 of The Andhra Pradesh Shops & Establishment Rules, 1990.

Precautions for safety of employees in case of fire in establishments in Telangana (Section 28(1), Rule 12)

Every establishment shall provide with adequate means of escape in case of fire and shall also provide buckets of water/ sand and/or chemical fire extinguishers in suitable number and at suitable sites according to the nature of work carried on and the size of the premises.

First Aid Appliances in establishments in Telangana (Section 28(2), Rule 14)

In every establishment other than a shop, a first aid box shall be kept and shall contain prescribed equipment together with a book of instructions.

In every establishment other than a shop, a first aid box shall be kept and it shall contain the following equipment together with a book of instructions on first aid namely:-
(i)3 small sterilised dressings;

(ii)2 medium size sterilized dressings;

(iii)2 large size sterilized dressings;

(iv)2 large size sterilized burn dressings

(v)2 (15.0 grams) packets sterilized cotton wool;

(vi)1 pair of dressing scissors;

(vii)1 (30.0 grams) bottle containing solution of salvolatine having the dose and

mode of administration indicated on the label;

(viii)1 (30.0 grams) bottle containing solution of iodine or mecurrichrome;

(ix)1 (30.0 grams) bottle containing Potassium Permanganate crystals;

(x)any antidotes for burns.

Entitlement for leave with wages in a year by employer in Telangana (Section 30(1),(2),(3),(7))

An employee who has served for 240 days or more during a continuous period of 12 months in any establishment shall be entitled to leave with wages for 15 days during subsequent 12 months. Leave with wages may be accumulated upto a maximum period of 60 days and encashment can be done for 8 days.

1. If any employee entitled to leave is discharged by employer before availing leave or his leave has been refused & he quits the employment before being allowed leave, employer to pay him the amount payable under this Act in respect of the period of leave.
2. Every employee in any establishment shall be entitled during his first twelve months of continuous service and during every subsequent twelve months of such service (a) to leave with wages for a period of twelve days on the ground of any sickness or accident and (b) to casual leave with wages for a period of twelve days on any reasonable ground.
3. If an employee is lawfully discharged by employer when he is sick or suffering from result of an accident, the employer shall pay him the amount payable under this Act in respect of period of leave to which he was entitled at the time of his discharge in addition to the amount, if any payable to him under the act.

Annual Holidays entitled to employees in Telangana (Section 31(1))

1. Every employee in any establishment shall be entitled to 9 holidays in a year with wages on the days to be specified by notification by Government.
2. Employer to send list of holidays with wages to Chief Inspector and shall also display list at a prominent place of establishment.

Compulsory enrolment of employees to Insurance-cum Savings Scheme in Telangana (Section 34)

Every employee who has served in an establishment for a period of not less than one year shall subscribe to the insurance scheme or Insurance-cum-Saving scheme as may be notified by the Government to be applicable to the establishment either in lumpsum every year or in monthly instalments.

Fixation of wage period by employer in Telangana (Section 36)

Every employer shall fix wage period which shall not exceed 1 month

Wages for overtime work to employee in Telangana (Section 37)

Twice the ordinary rate of wages shall be paid for over-time work.

Payment of wages by 5th day after the wage period in Telangana (Section 38(1))

1. The wages of every employee shall be paid on a working day before the expiry of the fifth day after the last day of the wage period in respect of which the wages are payable. b. In case of termination of an employee wages shall be paid in 2 days from the date of termination.

Deductions which may be made from wages by employer in Telangana (Section 40)

Wages to be paid to an employee without deduction except those authorised under the Act and Rules, prescribed in Section 40 of the Act

Fine to be imposed by employer in Telangana (Section 41(4))

1. The total amount of fine which may be imposed in any one wage period on any employee shall not exceed an amount equal to three paise in the rupee (i.e. 30%) of the wages payable to him in respect of that wage period.
2. A register in Form X to be maintained for fines

Form XII: Register of Advances by employer in Telangana (Rule 18(4))

The amounts of all advances to employees and all repayments of such advances shall be entered in a Register of Advances in Form XII.

Termination of services of employee for misconduct by employer in Telangana (Section 47, Rule 20)

No employer shall terminate the services of an employee unless an enquiry is held against the employee concerned in respect of any alleged misconduct in the manner set forth in sub-rule (2)

Service Compensation to employee by employer in Telangana (Section 47(3))

Compensation equal to 15 days average wage to be paid to an employee who has completed 1 year of continuous service, in case of:

1. Voluntary cessation of work after completion of 60 years of age
2. Resignation
3. Physical or mental infirmity
4. Death or disablement due to accident or disease

Payment of Subsistence Allowance by employer in Telangana (Section 47(6))

Where an employee is placed under suspension pending enquiry into grave misconduct the employer shall pay a subsistence allowance equivalent to 50% per cent of the last drawn wage for the first 6 months and at 75% per cent of the last drawn wage beyond 6 months during the period of suspension.

Form VII: Notice of change in any of the particulars in Certificate of Registration (Section 3(4), Rule 6 of Telangana Shops and Establishments Rules, 1990)

Any changes in the certificate of registration shall be submitted to the Director within fifteen days from the date the change took place

Form XXVII: Periodical Return (Rule 33)

Every employer having ten or more employees shall send a return in Form XXVII for months ending March, June, September and December of every year to the Inspector by 10th of the following month

Form XXII: Maintenance of Register of Employment in Telangana (Rule 29(1) of Telangana Shops and Establishments Rules, 1990)

Every employer shall maintain a Register of Employment in Form XXII.

Form XXIII: Register of Wages in Telangana (Rule 29(2) of Telangana Shops and Establishments Rules, 1990)

Every employer shall maintain a Register of Wages in Form XXIII

Form XXV: Register of Leaves by employer in Telangana (Rule 29(6) of Telangana Shops and Establishments Rules, 1990)

Every employer shall maintain a Register in Form XXV for the leave granted to persons employed in his establishment.

Visit Book to be maintained by employer in Telangana (Rule 29(10))

Every employer shall maintain a Visit Book in the establishment in which an Inspector visiting the establishment may record his remarks regarding any defects that may come to light at the time of his visit or give directions regarding production of any documents required to be maintained.

Display of Name Board of the Establishment in Telangana (Rule 29(13))

The name board of every shop or establishment shall be in Telugu and wherever other languages are used, the versions in such other languages shall be below the Telugu version.

Form XXVI: Letter of Appointment to be given to all employees in Telangana (Rule 30)

Every employer shall furnish to all employees with the Letters of Appointment, with the photograph of the employee in Form XXVI affixed thereon and obtain acknowledgement in token of having served also the said letter.

Conditions to be fulfiled by ITES / IT Establishments in Telangana

ITES / IT Establishments must fulfil the prescribed conditions to avail the exemptions from compliance of provisions of Sections 15, 16, 21, 23 and 31.

Penalties & Punishments

Any employer who makes any false or incorrect statement under section 3 shall be punishable with fine which may extend to one hundred rupees.

Conclusion

The Telangana Shops & Commercial Establishment Act, 1988, serves as a comprehensive framework for regulating working conditions, employee welfare, and establishment operations across commercial enterprises in Telangana. This legislation encompasses critical aspects of employment including working hours, wage payments, leave entitlements, safety measures, and employee rights protection.

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