The Shops and Establishments Act is enacted by every state in India. The Act is designed to regulate the payment of wages, hours of work, an interval for rest, opening and closing hours, holidays, overtime work, annual leave, sick leave, casual leave, condition of the employment etc.
Concept of Leaves
Employees are entitled to a certain number of days of leave per year aside from the holidays and days off. Generally, three types of leave are mentioned under the Shops and Establishments Act i.e., Privilege leave, Sick leave and Casual leave. This varies from state to state. So, the number of leave entitled to an employee depends upon the state in which the establishment is located. The leave policy of an establishment should align with the leave provision of the respective state’s Shops and Establishments Act. The said leave policy cannot be less beneficial than that mentioned by the respective state’s Shops and Establishments Act.
Generally, the framework of the Act is similar throughout. However, the leave provision under the Act varies for every state.
Leave and Working Hours Across States in India
The states in which leave & working hours are applicable are listed below:
Types of Leave
These are the additional leave of absence awarded to an employee with wages for the day’s work performed by him for a specific number of days as prescribed under the Shops and Establishments Act. The condition to avail of the Earned/Privilege leave may differ in every establishment. The total number of days of Earned/Privileged leave that may be carried forward to a succeeding year is prescribed under the Shops and Establishments Act. The employee is entitled to encashment of Earned/Privileged leave as per the respective state's Shops and Establishments Act and Rule.
The Casual leave is granted for an unanticipated event or when an employee is unable to attend the office for a day or two due to any personal exigency. The quantum varies from state to state, as per the Shops and Establishments Act. Normally companies restrict Casual leave to a short duration. However, if an employee wishes to avail of Casual leave for a longer period then prior permission is required or a plausible reason needs to be provided upon re-joining. Casual leave is normally not clubbed with other leave but can be availed along with other leave in case of insufficient leave balance. Generally, Casual leave is not cashable, nor it can be carried forward.
An employee is entitled to avail of Sick leave in case of sickness. During Sick leave, wages are paid to the employees when they are out of work due to illness. The number of Sick leave is fixed by the establishment per the provisions of the respective state’s Shops and Establishments Act. Sick leave accumulated in a year may be carried forward and availed in the next year in certain states.
Overtime refers to the time worked more than one's regular working hours which, in India, is eight to nine hours per day and forty-eight to fifty hours per week, depending upon the establishment one is employed with. Overtime wages are to be paid at the rate of twice the ordinary rates of wages by the employer if an employee works more than the working hours as prescribed under the Act.
Several statutes regulate overtime and overtime payment, and different legal acts provide for different periods of working hours.
Spread Over Hours
Spread Over means total working hours of an employee, inclusive of rest breaks and overtime.
Interval for rest
Interval for rest is a break taken during working hours.