India: State Amends Factories Act to Allow More Working Days and Overtime

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By Madhur Singh

March 18—The state government of Maharashtra has enacted an amendment to the Factories Act that allows all workers to put in more overtime and women workers to work night shifts, while reducing the number of days that must be worked before an employee can claim paid annual leave.

Effective Feb. 1, 2016, the Factories (Maharashtra Amendment) Act of 2015 makes state-level changes to the national Factories Act of 1948, which makes provisions for the health, safety, welfare, working hours and leave of workers and is enforced by the state governments through their respective “factory” inspectorates.

The act applies to all industrial establishments (as against shops and commercial establishments) that employed 10 or more persons on any day in the preceding 12 months and where manufacturing involves the use of electricity or that employed 20 or more workers on any day in the preceding 12 months and electricity is not used in the manufacturing process.

The Specifics

The key changes made by the state of Maharashtra include:

  • The state government can issue notifications specifying the number of workers that must be employed on any given day in an industrial premises for it to qualify as a factory (and thereby require a license and undertake to comply with the requirements under the statute).
  • Factories no longer need to seek permission from the state government or chief inspector of factories to make employees work overtime. New rules will govern how, when and how many adult employees can be allowed to exceed prescribed weekly and daily hours and work during weekly holidays.
  • Allowable overtime hours have been increased from 75 to 115 per quarter.
  • Women workers can now work the night shift, provided adequate arrangements are made for their safety as provided for in rules made by the state government. Earlier, women were not allowed to work in factories between 7 p.m. and 6 a.m.
  • Workers will now be eligible for paid leave in the subsequent year if they work 90 days during a calendar year; the earlier requirement was 240 days.
  • A new section has been added to allow offenses listed in the Fourth Schedule (not providing toilets, canteen facilities, etc.) to be compounded (settled through payment of monetary compensation) by the deputy chief inspector or a higher official with penalties up to 100,000 rupees ($1,500). Once an offense has been compounded, it cannot be prosecuted further.
  • Investigation into an offense can only begin once the chief inspector of factories has sanctioned it following a complaint. Earlier, complaints could be sanctioned for investigation by the lower-ranking inspectors of factories.
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    These changes became effective Feb. 1, although some of the rules governing their application have yet to be released.

    To contact the reporter on this story: Madhur Singh in Chandigarh at correspondents@bna.com

    To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

    For More Information

    For more information on Indian HR law and regulation, see the India primer.