BACKGROUND
The Karnataka Shops and Commercial Establishments Act1961 is one of the state labour laws enforced by the Department of Labour. This act is valid all over the state of Karnataka from the date notified by the state government. This act provides regulations and other guidelines for work and employment in Shops and Commercial establishments inside the state of Karnataka.
MEANING AND IMPORTANT DEFINITIONS
“Commercial Establishment” means commercial or trading or banking or insurance establishment, an establishment or administrative service in which persons employed are mainly engaged in office work, a hotel, restaurant, boarding or eating house, a cafe or any other refreshment house, a theatre or any other place of public amusement or entertainment and includes such establishments as the State Government may by notification declare to be a commercial establishment for the purposes of this Act;
“Shop” means any premises where any trade or business is carried on or where services are rendered to customers, and includes offices, storerooms, godowns, or warehouses, whether in the same premises or otherwise, used in connection with such trade or business, but does not include a commercial establishment or a shop attached to a factory where the persons employed in the shop fall within the scope of the Factories Act, 1948;
“Employee” means a person wholly or principally employed in or in connection with, any establishment whether working on permanent, periodical, contract or piece-rate wages, or on commission basis, even though he receives no reward for his labour and includes an apprentice, any clerical or other member of the staff of a factory or industrial establishment who falls outside the scope of the Factories Act, 1948, but does not include a member of the employer’s family; and “employed” shall be construed accordingly;
“Employer” means a person having charge of or owning or having ultimate control over the affairs of an establishment and includes members of the family of an employer, a manager, agent or other person acting in the general management or control of an establishment;
EXEMPTIONS FROM REGISTRATION UNDER THIS ACT
The Act shall not apply to following:
Offices of or under the Central and State Government or local authorities except commercial undertakings.
Postal, railway, Telephone, water transport services.
Offices of a banking Company.
Railway Dining Cars.
A place to treatment or care for the sick or people who is mentally unit.
Establishment of Food Corporation of India (FCI).
Offices of a banking.
Offices of legal and medical operations where only three persons are employed.
A shop mainly in medicines, surgical requisites or appliances.
A person directly engaged in a clerk job responsible for the dispatch of goods.
FEATURES OF KARNATAKA SHOP AND COMMERCIAL ESTABLISHMENT ACT
Issuing Registration Certificate.
Renewal of Registration Certificate.
Facilitating changes in Registration Certificate.
Issuing Duplicate Registration Certificate.
Annual Returns Filing.
Exemption or relief weekly holidays.
Exemption for Women working in Night Shifts.
Appeal submission.
DUTIES OF THE OWNER
Registration of the organization
Weekly Holiday for the Establishment
Fixing Working Hours
Employment and Regulation
Records Management
PROCESS OF REGISTRATION
For registration and renewal of establishment under the Karnataka Shop and Commercial Establishment Act, 1961 entrepreneurs can avail the e-Karmika online facility.
In case of a new registration, you should register the organisation within 30 days from the date of commencement of business.
In case of an existing organisation, you should register the organisation from the date on which this Act comes into force.
The registration certificate is valid for five years and it should be renewed before the expiry date by paying fees and in the manner prescribed.
The business owner should display the registration certificate in a place where everyone can see inside the office premises.
If you plan to change any information, such change should be notified in the prescribed format to the registration authority.
After closing the business establishment, the owner should submit the registration certificate to the authority.
DOCUMENTS REQUIRED FOR REGISTRATION
Identity / Address Proof of the owner(Aadhar card/ Driving license/Voter Card etc.).
Incorporation Certificate /Memorandum of Article (In Case of Private Ltd. Company).
Authorisation letter for Authorised signatory / self attestation Letter for Owner.
Challan /Payment Receipt /Transaction Receipt.
Duly filled Registration Form signed by owner / Authorised signatory.
FEES FOR REGISTRATION
No. of Employees Fees (Rs.)
No Employees 300/-
1 to 9 Employees 600/-
10 to 19 Employees 4000/-
20 to 49 Employees 10000/-
50 to 99 Employees 20000/-
100 to 250 Employees 40000/-
251 to 500 Employees 50000/-
501 to 1000 Employees 70000/-
Above 1000 Employees 75000/-
HIGHLIGHTS OF KARNATAKA SHOPS AND ESTABLISHMENT ACT
WEEKLY HOLIDAY FOR THE ESTABLISHMENT
An establishment must remain closed for one day of the week. The owner of the establishment has to fix such a day at the beginning of the year and the same should be informed to the registration authority.
However, certain establishments are exempted from weekly holidays. Here are some of the establishments.
1. Clubs, Hotels, School and College Hostels, Residential schools.
2. Hair Cutting Saloon.
3. Copper, Container, Manufacturing Firms.
4. Selling Petrol and Diesel.
5. Daily Newspaper & Weekly Magazines.
6. Cinema halls, theatres and other recreational centres.
7. Medicine and Medical Equipment sellers.
8. Organisations performing research/study on infectious diseases.
HOURS OF WORK:
As per the Karnataka Shops and Establishment Act, employees can only work for nine hours on any day and forty-eight hours in any week. If the employee works more hours, then wages need to be provided for overtime. Further, the period of work of an employee in an establishment should be fixed so that, no period or work exceeds five hours without an interval.
WORKING HOURS:
Any Business or establishment within the prescribed working hours. In other words, any.
Establishment shall not before and after the following hours.
Bangalore City – Before 6 am and Night after 9 pm.
Other location: Before 8 am and after 8 pm.
ANNUAL LEAVE WITH WAGES
Employees working in an establishment in Karnataka have a permit to avail a leave with wages at the rate of one day for every twenty days of work done. In case, of young persons, the employee should be allowed to avail a leave with wages at the rate of one day for every fifteen days of work performed.
EMPLOYMENT OF CHILD, YOUNG PERSONS AND WOMEN
The Karnataka Shops and Establishment Act prohibits the employment of a child at any establishment. A child is any person who has not completed fourteen years of age.
Also, young person and woman cannot be required or allowed to work whether as an employee or otherwise in any establishment during night. A young person is anyone who has completed the age of fourteen, but not eighteen.
EMPLOYMENT AND REGULATION:
1. Any employee who has completed 180 days or 6 months of service cannot be dismissed without prior notice.
2. Working time-period of any employee should not exceed 48 hours and 58 hours including extra working hours.
3. Employee attendance should be maintained in Form T.
4. Salary should be credited to every employee before the 7th of next month.
FORMS & RECORDS:
1. Form A:
Registration, Renewal and Report Change of information of establishment.
2. Form P:
Fixing different days for weekly holidays.
3. Form F & Form H:
Maintaining employee leave a record (Form F) and share a copy to the employee (Form H)
4. Form T:
Employee daily attendance.
5. Form R:
Permission to allow women to work after 8 PM.
6. Form U:
Annual Report for the year ending with 31st December shall be submitted before 31st January of next year.
The act will be implemented under the supervision of labour commissioner – Chief Inspector.
Inspector and Senior Inspector – Inspector and department level authorities are called as Additional Inspector.
We at Gaurav Jain and Associate will be pleased to obtain Karnataka Shops and Establishment Act Registration