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Karnataka Shop and Establishment Act

Applicability:

All shops, establishments and commercial establishments in Karnataka. The provisions of Karnataka Shop and Establishment Act shall as and when applicable apply to this act.

This act regulates areas like Working hours, Overtime, Leave policy, Rest interval, Opening and closing hours, Closed days, National and religious holidays, Time and conditions of payment of wages, Deductions from wages, Maintain various Registers etc.

Registration:

Each owner, within 30 days from starting the business shall submit application in form ‘A’ to register the establishment.

The registration certificate shall be renewable by the 31st March after every 3 years.

30 days grace time shall, however, be allowed for the renewal of the certificate after payment of prescribed fee.

Establishments exempted under the Act:

a) Offices of, or under the central or state Government, or local authorities, except commercial Undertaking.

b) Any railway service, Water transport services, postal, telegraph or telephone service, any system of public conservation or sanitation or any industry, or services like water, Power, light to the public.

c) Establishments of medical practitioners and legal practitioners in which not more 3 persons are employed.

d) Offices of bank and establishment of the food corporation of India.

Compliances:

a) Registration under the Act in Form A within 30 days from starting of business.

b) Mandatory registers to be maintained such as Holiday list.

Leave Policy:

Every employee who has been in employment for not less than 20 days in a year shall be entitled to 1 day’s earned leave for every such twenty days and 1 day per 30 days as sick leave shall be calculated.

a) one day for every twenty days work performed by him, in case of an adult

b) one day for every fifteen days of work performed by him, in case of a young person

The number of paid leaves carried forward should not exceed 45 days.

Employer must to furnish letters of appointment to employees after appointment.

Time and Conditions of payment of wages:

Before the expiry of the 7th day of the last day of the wage period in respect of which the wages are payable.

Over-Time:

For any work in excess of 9 hours on any day or for more than 48 hours in any week, overtime wages are to be paid at the rate of double the wages.

Submission of annual report:

Annual report ending with 31st December shall be submitted before 31st January of next year in the Form U.

Interval for Rest and Meals:

No employee to work more than 5 hours in a continuity without a break for at least 1 hours of rest or a meal.

Employers are not allowed to hire children or individuals under the age of 14 including a child is a part of the family that owns the business.

No woman can be required or allowed to work at night, as an employee or otherwise in any establishment.

Maternity Benefits:

Maternity leave for any number of days but not exceeding 12 weeks.

Must have a sufficient arrangement for the employee access to drinking water.

Establishments must operate as per the timings prescribed by the Karnataka government. However, the government can prescribe different opening and closing times for different classes of shops or commercial establishments.

Notice of Dismissal:

No employer shall dispense who has been in continuous employment for not less than six month, without giving at least one months notice in writing or wages in lieu of such notice.

Records management:

a) To get permission to allow women to work after 8 pm as per format R.

b) Leave record as per format F.

c) Weekly holiday as per format P.

d) maintain daily attendance of employees as per format T.

The records and registers must be preserved till the end of the following year.

Penalties:

Punishable with imprisonment for a term which shall not be less than 3 months but which may extend to 6 months or with fine which shall not be less than Rs.10,000/-, but which may extend to Rs.20,000/- or with both, for the first offence and for the second and subsequent offences, he shall be punishable with imprisonment of a term which shall not be less than 6 months but which may extend to 1 year.

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Author – CA Gaurav Agrawal, Kishore Gupta & Co, Chartered Accountants in Practice from Central Delhi and can be contacted at gauravag.ca@gmail.com & Mobile Number 9711033545.

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Author Bio

I'm the Fellow Member of ICAI & ICSI both fraternity and I'm responsible for all Indian and Foreign clients in my firm as a Managing Partner. I'm also Diploma Holder in Information System Audit (DISA), Concurrent Bank Audit (CCBA) and Fraud & Forensic Audit (FAFD) from ICAI. I have also obta View Full Profile

My Published Posts

Short Note on Shop Commercial & Establishment Act – Maharashtra State Short Note on Shop Commercial & Establishment Act – Haryana State Short Note on Professional Tax – Karnataka State Short Note on Child Labour (Prohibition & Regulation) Act, 1986 Short Note on Employees’ Compensation Act, 1923 View More Published Posts

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