The Indian labour law refers to laws, rules and regulations, regulating labour in the country. These laws came about to protect workers at every level in India, not discriminating on the type of work performed. Their protection was supposed to be handled by the Central and State Governments, however, since labour isn’t as easily defined and turned into a larger task, needed a separate department.

A Business Licence also called the Shops and Establishment Licence, and multiple combinations of these works are permits issued by the Government allowing people or companies to run in specific areas under the jurisdiction of that Government. In some cases, this might be done by the Central Government and in others by the state Government.

Depending on the type of company, there are often multiple licenses to be applied for, and getting the Shop Licence is a good start for fast-tracking the process.

How did the shops and establishment act come about?

Across India, there are specific rules regarding work conditions which might vary slightly depending on state Governments. The main reason for this is to create equal advantages for different employees doing diverse types of work, whether in shops, residential hotels, commercial establishments like restaurants, theatres or other places of public amusement or entertainment.

Some of the rules put down mentioned the amount of time to be spent at work, whether in a day or a week, the guidelines for spread-over work, details about rest intervals, breaks for meals, opening and closing hours, national and religious holidays, closed days, general rules relating to the employment of children, young persons, and women, working overtime work whenever

needed, rules for maternity leave, annual leave, sickness, and casual leave. There were even rules for the employment and termination of service maintenance, and the office maintaining records and registers. Finally, there were specific dictates about displaying notices and obligations of the employers as well as employees.

Some of the factors determining the details of a license are the number of employees, type of business, whether sole proprietor or corporation, the amount paid in salaries, location of the premises. Government agencies can fine or shut down businesses operating without the necessary licenses.

What records should be maintained by places of work?

Before beginning any type of work, businesses have to get all the right approvals from the Department of Labour. They have to maintain all their information including details of employment, fines, deductions and advances, salaries of all employees, and their leave policy with holidays under the shop act, through a regularly updated register.

Although many details might vary from state to state, with some information directly related to the specific companies, and general details staying the same across the country. Overall, files related to annual holidays and the number of employees have to be submitted to the Municipal Corporation annually.

All business entities have to be registered compulsorily under this act within 30 days of commencement of work. They are allowed to begin functioning while the documents and certificates are submitted and being evaluated. Many additional licenses require the shop’s registration as proof of commercial business.

For most financial processes and bank work, the shop’s registration license comes in handy. Business owners have to furnish this license to open a current account along with the PAN card of either the business owners or business itself, a copy of the rental agreement or sale deed, and details of all employees.


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