September 9, 2016 In Uncategorized

Model shops and Establishments (Regulation of Employment and Conditions of Service) Bill, 2016


The Model Shops and Establishment (Regulation of Employment and Conditions of Service) Bill, 2016 is a welfare legislation which intends to bring equality in regulation of employment and conditions of service throughout the country. According to the Ministry of Labour and Employment, this Bill is a bold step towards employment generation. It will give a boost to employment opportunities to women as they will be permitted to work during night shifts with adequate safety and security provisions. States have been granted autonomy to adopt and modify this Bill as per their requirement, as this subject falls within the State List. This Model Bill would be applicable to shops and establishments employing ten or more workers except manufacturing units. However, the States can change this as per their needs.

The Cabinet in its meeting held on 29th June, 2016 considered the Model Shops and Establishment (Regulation of Employment and Conditions of Service) Bill, 2016 to be sent to States who will modify their individual Acts, if they so desire either by adopting the said Bill as it is or after modifying its provisions as per the requirement of that particular State/UTs. This Bill was approved by the Union Cabinet on June 29, 2016. The Bill was finalized after detailed discussions with public, through internet and with employees/labour representatives, employer’s association and State Governments through Tripartite Consultations process.

Major reforms proposed by this Bill:

Working hours: Establishments are allowed to function on all days in a year and can also decide their opening and closing timings. The Bill puts a limit that employees can work for a maximum of 9 hours a day and 48 hours a week, and upto a maximum overtime of 125 hours in a quarter. Highly skilled workers (for e.g. workers employed in IT, Biotechnology and R&D division) are exempted from these provisions of maximum working hours. This flexibility will enable the establishment to better services to their clients who cater to international customers especially in the IT sector.

Welfare provisions: A number of welfare provisions like drinking water, crèche, canteen facilities, etc. have been proposed by this Bill.

Women: The Model Bill proposes no discrimination against female employees in matters of recruitment, transfers, promotion, etc. It grants liberty to women to work in a night shift only if the employer provides facilities like night crèche, protection from sexual harassment, transportation from establishment to their residence doorstep, etc.

Leave:  The Model Bill entitles every employee 8 days casual leave, one day for every 20 days of work for every worker who has worked for 240 days in subsequent year and 8 days of paid leave for festival holidays.

In addition to the above mentioned reforms, this Model Bill would promote fair competition among the States in improving the Governance and ease of doing business. The enhancement of working hours in shops and establishments 24×7 with adequate provision for protection of the workers will give rise to requirement for additional manpower which will result in additional employment. It is expected that the Bill if adopted by State will lead to growth in jobs especially in the retail, IT, hospitality and services sector.

The Model Bill is a suggestive piece of legislation and has been finalized keeping in view the spirit of co-operative federalism. It is a much awaited reform, aimed at protecting the interest of the employees. This gives liberty to States for fine tuning the Model Bill to suit their requirements. It is indeed an applaudable step by Central Government towards employment generation. This is expected to generate competitive and challenging spirit amongst the States and create an environment which is conducive for large scale employment generation at every level, especially in smaller and medium towns. It will give a boost to employment opportunities to women as they will be permitted to work during night shifts with adequate safety and security provisions. We hope that this Model Bill would be enforced soon and sees light of the day to bring uniformity in regulation and conditions of service across the country.


Sanchayeeta Das


The Indian Lawyer

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