The Shops and Establishments Act regulates all the shops and commercial establishments operating within the state. This Act was enacted to improve the management of working conditions and employment in shops, commercial establishments, restaurants, dining establishments, hotels, theatres, and other public places of amusement. The Shop and Establishment Act is regulated by the Labour Department of the respective states.
To regulate the condition of work and employment and therefore to secure maximum benefits to the employees working in different categories of establishment viz. Shops, Commercial Establishments, residential hotels, restaurants, eating houses, theatres and other places of public amusement or entertainments are mainly protected by the provisions of this act.
Scope and Coverage:
- A state legislation; each state has framed its own rules for the Act.
- Applicable to all persons employed in an establishment with or without wages, except the members of the employer’s family.
What is an Establishment?
Includes a shop, commercial establishment, residential hotel, restaurant, eating house, theater, or other place of public amusement or entertainment to which this Act applies and includes such other establishment as the State Government may, by notification in the Official Gazette, declare to be an establishment for the purposes of this Act.
What is a Shop?
Shop means any premises:
1. Where goods are sold, either by retail, wholesale, or
2. Where services are rendered to customers.
3. It includes an office a store-room, godown, warehouse or work place, whether in the same premises or otherwise, used in connection with such trade/ business
A shop does not include a factory, a commercial establishment, residential hotel, restaurant, eating house, theater or other place of public amusement or entertainment.
Regulations under the Act:
The Act regulates the following matters-
- Hours of work, annual leave, weekly holidays
- Payment of wages and compensation
- Prohibition of employment of children
- Prohibition of employing women and young persons in the night shift
- Enforcement and Inspection
- Interval for rest
- Opening and closing hours
- Record keeping by the employers
- Dismissal provisions
Entities Required to obtain Registration:
The following entities are required to obtain the Shop and Establishment Act Registration-
- Retail and wholesale shops
- Premises where services are rendered to customers including office
- Workhouse or workplace used for trade or business
- Theatre or place of public entertainment or amusement
- Commercial establishment
- Storeroom, warehouse or godown
- Restaurant or eating house
- Residential hotel
Procedure for Registration:
Every eligible establishment needs to register for a license within 30 days of the date of commencement of their business to avoid penalties under the act.
- Log on to the website of the respective state where you want your business to get registered
- Fill out the application form. This will include certain details like the registering procedure as an individual or organization, based on the kind of establishment/business initiative getting registered
- Fill in the details of the organization and proprietor
- Upload the requisite documents
- Upload the signature
- Pay the required fees
- Inspection of the application by the labour department and an inspector might be appointed to carry out an inspection of premises if required
- Approval of application by the authorities and issue of a valid license (normally valid for 1 year with renewal every year).
Documents Required for Registration:
The documents required for obtaining the shop and establishment registration certificate is-
- Shop or Business Establishment address proof
- ID proof of the proprietor
- PAN Card of the proprietor
- Details of the employees
- Payment challan
- Additional business licenses necessary for starting the business, if any.
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Note: This Post was last updated on February 2, 2023
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