The Government of Andhra Pradesh, through G.O. Ms. No. 7 dated March 25, 2025, has extended a five-year exemption for all Information Technology (IT) and Information Technology Enabled Services (ITES) companies from certain provisions of the Andhra Pradesh Shops and Establishments Act, 1988. This decision is part of the state’s continued efforts to foster a business-friendly environment and support the dynamic needs of the IT sector.
Detailed Analysis:
What’s Exempted?
The following sections of the Andhra Pradesh Shops and Establishments Act, 1988 will not apply to IT and ITES companies for the next five years:
- Sections 15, 16, 21, 23, 31
- Section 47 (1), (2), (3), and (4)
These sections typically govern:
- Working hours and daily time limits
- Opening and closing timings of establishments
- Weekly holiday mandates
- Maintenance and display of statutory records
Implications for Businesses:
- Greater Operational Flexibility: IT/ITES firms can now schedule work hours and shifts to suit client demands and time zones without being limited by fixed statutory hours.
- Ease of Doing Business: Reducing regulatory constraints enhances the attractiveness of Andhra Pradesh as an investment destination for tech companies.
- Lower Administrative Burden: With fewer compliance requirements, HR and legal teams can focus more on internal strategy and less on procedural filings.
Impact on Employees:
While the exemption offers greater flexibility for employers, it may also lead to some challenges for employees, including:
- Longer working hours without the statutory limitations previously enforced
- Potential work-life imbalance, especially for employees working in global time zones
However, employers are encouraged to implement internal welfare policies to maintain fair work practices, despite the regulatory relaxation.
Real-World Example:
An ITES company operating a BPO for US clients can now legally run night shifts and flexible work schedules without violating local labour laws. This aligns with global business demands while maintaining legal compliance.
Call to Action:
Are you managing an IT or ITES firm and unsure how this exemption affects your compliance strategy?
Contact Key4Comply for personalized guidance on building labour-friendly, regulation-light HR frameworks that support your growth and employee well-being.