The Occupational Safety, Health and Working Conditions Code 2020 covers sectors like factories, mines, dock, plantations and activities like construction, beedi and cigar manufacturing, cine production and conditions of service of sales personnel, interstate migrant workers and employment practice of contract work. But the establishments which are not factories, mines or plantations but are covered under the respective state’s Shops and Commercial Establishments Act will continue to be covered by that Act. If that is correct, I need one clarification, ie,

(1)Will the sales personnel employed in such shops/ commercial establishment be covered by the Occupational Safety….Code?
(2)Will the Contract labour and interstate migrant labour in the commercial establishments be under the said Code?

Now, the present Act (ie, Sale Promotion Employees (Condition of Service) Act, 1976, covers only sales personnel of certain industries. Initially it was meant to cover sales personnel of pharma industry but later on some 10 or 11 industries were added and obviously, there are a number of industries which are yet to be covered. The code has no reference as to which sector should they represent and naturally it should be understood that they will be covered irrespective of industry. That widens the scope of sales promotion employees. But is it possible that sales promotion employees of a trading organisation covered under the Shops and Commercial Establishments Act which is out of the purview of the Code become part of the Code? If sales promotion workers are covered, the clerks and others who are working in the shops and establishments only will be left out.

Under the Code Inter state migrant labourers shall include those recruited directly by the employer but under the existing Act those who are recruited and paid directly by the employer is not an interstate migrant labour. Similarly, there are different treatment with regard to contract labour under the Code. My question is if a Shop is not covered by the Code, is it possible to cover certain employees, like sales personnel, migrant workers or contract workers, only under the Code?
If yes, how can the shop/ commercial establishment obtain registration?

It may also be noted that the definition of motor transport worker excludes workers working in the office of the transport company which is under the Shops and Commercial Establishments Act!

Madhu T K

From India, Kannur
Labour Law & Hr Consultant
Industrial Relations And Labour Laws

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Dear Mr.Madhu,

At the outset, it is my personal opinion that the two main questions in your post deserve appreciation and the other questions interspersed with your arguments require a detailed analysis of the very codification of the existing 29 Central labor laws into 4 major Labor Codes.

As you are well aware, labor is a subject matter falling under the concurrent list of the Seventh Schedule of the Constitution of India. As such, we have hundreds of labor laws both Central and State in force and this multiplicity of laws reduced the effectiveness of compliance, enforcement and the measures of industrial dispute resolution. Hence the second National Labor Commission specifically recommended in its report the grouping of the existing labor laws into four or five groups into (i) Industrial Relations (ii) Wages (iii) Social Security (iv) Safety (v) Welfare and Working Conditions and so on inter alia the necessity to consolidate all the existing Central and State Labor Laws into a single Labor Management Relations Law. State Labor Laws relating to shops and other establishments, national and festival holidays, conferment of permanent status to workmen etc., are legislated by the respective States based on the regional concentration of industries and local customs. No doubt that uniformity of the provisions are required even among such different State Laws after the advent of LPG as suggested by the 2nd National Labor Commission. Not withstanding the possible criticism of usurpation of State Govt powers by the Central Govt, we may take the introduction of the Model Shops and Other Commercial Establishments Rules,2016 by the Central Government as a first step in this direction by giving a choice to the States to adopt them.

The Code on Wages,2019 covers all the essential elements of payments under the contracts of employment such as determination of wage periods, mode of payments, authorized deductions and their extent including loans and advances to employees, fixation of minimum wages and their periodical revision, equal remuneration and payment of bonus and the mode of disposal of claims arising thereof. If we analyse the definitions of the terms ' establishment' [ Sec. 2(m) ], 'employer' [2(l)], 'employee'[2(k)] and 'worker' [2(z)], the Code would apply to all establishments subject to the conditions for non-applicability provision given under each Chapter.

We can draw an analogous position of law in respect of the other Codes by examining the respective terms defined under each.

In this back drop, first, let me try to answer your first two queries as follows:

(1) This is a valid question in view of the void created by the OSH&WC Code,2020 by the conspicuous omission of the definition of the term 'establishment' with reference to the specific activity of promotion of sales which is commonly understood as an operation under the realm of marketing rather than mere selling of goods direct to the customers. When the Code specifically defines other establishments like factory, plantation, news paper establishment, motor transport undertaking etc., with reference to their predominant activity, the generic definition of establishment u/s 2(1)(v)(i) with a threshold number of workmen certainly justifies the question you have raised. As you rightly pointed out, the definition of the term ' establishment' u/s 2(a) of the SPE Act,1976 is specific to the point and expandable by virtue of the enabling provision u/s 3 of the Act. I think a suitable amendment is required to dispel the ambiguity.
However, I am of the view that by virtue of the repealing provision under the Code, the provisions of the Code simply substitutes only the working conditions provided under the repealed SPE Act,1976 and as such it may not be apt to bring them on par with the employees of shops and other establishments whose predominant activity is selling or rendering services to the direct customers while their working conditions etc., are already covered by the establishment-specific State Act.

(2) The State Shops and other Establishments Acts have specific provisions as to working conditions, health and safety befitting the environmental conditions and nature of the activities performed therein. Therefore, I would prefer only to say "NO" to this query.

Coming to your other queries, I would like to ask you to focus on the uniformity of the meanings assigned to the definitions of various terms like 'establishment', 'industry', 'employer', 'employee', 'worker', 'wages', 'industrial disputes' frequently being used in one part or the other of the four Codes. In my opinion all industrial establishments whether within or outside would come under the purview of the Codes in respect of the subject-matters dealt with therein. For instance, a claim for bonus can be raised under the Industrial Relations Code,2020 by an employee of a shop wherein 20 or more employees are employed. The minimum rate of wages fixed by the appropriate Government under the Code on Wages,2019 has to be paid by the employer of a shop. So would be the case of engagement of contract labor ( it is not possible in view of the definition of "core activity " in the concerned Code ) and Interstate migrant labor in shops and establishments. And the new definition of interstate migrant workman under the Code expands the scope of the term as put forth in the Statement of Objects and Reasons.
One can easily justify the exclusion in view of the patent difference in the nature of duty of the running crew in a motor transport undertaking and the clerical/administrative staffers in its office.

I would reiterate that your queries are genuine and appreciable. There may arise other practical problems when the Codes are actually enforced. Like any other law, subsequent amendments would be in place.

From India, Salem

Thank you so much Sir for your immediate response. I have raised the same question in another forum in which I use to get frequent updates and invitations to attend workshops on Labour Codes. I think the trainers in that forum should have started preparing their Ppts and taking sessions well before the government has decided to introduce Labour Codes! But nobody in that group has come up with an explanation!

Actually I had listed these points for consideration when objections and recommendations were invited some time in 2019 or 2020. After the codes were introduced, I had only a rough reading of the same. Now the rules have also come and though of reading the codes in detail. Hence the doubts.

Thank you once again Sir. Will catch you agin with more queries on the same subject!

From India, Kannur

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