Historically, the Shops & Establishments Acts governed employment conditions in non-factory and non-mine establishments across Indian states. From November 2025, these provisions have been consolidated into the Occupational Safety, Health and Working Conditions Code, 2020 (OSHWC Code), along with state-specific rules.
For HR professionals, mastering the OSHWC Code is critical to avoid penalties, defend employee complaints, and ensure smooth audits.
Registration of Establishment
- Requirement: Every establishment must register under the OSHWC Code within 30 days of commencement.
- Certificate: Registration certificate must be displayed at the workplace.
- Applicability: All non-factory, non-mine establishments.
Non-registration can trigger penalties and inspection objections.
Working Hours & Spread Over
- Daily Limit: 8–12 hours (with consent for extended shifts).
- Weekly Limit: 48 hours.
- Spread-over: Maximum 10 hours/day.
- Overtime: Mandatory beyond limits, paid at double rate.
Fixed salary is not an excuse to bypass overtime pay.
Overtime Wages
- Overtime must be paid at 2x the ordinary wage.
- Cannot be adjusted against incentives or compensatory leave.
- Attendance and shift records must be maintained.
Weekly Off & National Holidays
- One compulsory weekly off.
- National/festival holidays must be granted OR double wages paid.
- Continuous work without weekly off = statutory violation.
Leave Entitlement
Under state rules framed under the OSHWC Code:
- Earned Leave (EL): 1 day for every 20 days worked.
- Casual Leave (CL): 6–12 days/year.
- Sick Leave (SL): 6–18 days/year.
Employers must document and implement a clear leave policy.
Wages & Salary Payment
- Salary must be paid by the 7th/10th of the following month (Code on Wages, 2019).
- Unauthorized deductions are prohibited.
- Payslip issuance is mandatory.
Payroll records must show deduction proofs and employee consent.
Termination, Notice Period & Service Conditions
- Termination must be supported by reasonable cause.
- Final settlement must be made on the last working day (Code on Wages).
- Notice period terms must be clearly defined in appointment letters.
Employment of Women
Employers must maintain registers for:
- Attendance, wages, leave, overtime, employment records.
Additional compliance under Labour Codes:
- Social Security Code: Maternity benefits.
- Code on Wages: Equal remuneration.
- PoSH Act, 2013: Anti-harassment compliance.
Why HR Must Master the OSHWC Code
- Defend employee complaints legally.
- Avoid labour inspector penalties.
- Draft compliant appointment letters & HR policies.
- Handle termination safely.
- Face audits confidently.
Penalties & Prosecution
Non-compliance risks include:
- Fines for unregistered establishments.
- Penalties for excessive working hours.
- Prosecution for unpaid overtime.
- Liability for delayed salary payments.
- Inspection objections for missing leave policies.
HR Compliance Checklist (2026)
- Register establishment under OSHWC Code within 30 days.
- Display registration certificate.
- Track working hours and overtime.
- Maintain holiday and leave records.
- Issue payslips with statutory breakup.
- Document termination and settlements.
- Maintain registers for women employees.
- File compliance records for audits.
Disclaimer: This blog is for educational purposes only. Provisions under the OSHWC Code vary by state rules. For case-specific advice, consult a certified Labour Law Consultant or practicing advocate.