Understanding Overtime Rules: How Do You Calculate Working Hours and Pay in Chennai?

Clarifications on Overtime Implementation in Chennai

I am implementing OT in my company in Chennai, Tamil Nadu, and have a few clarifications regarding OT:

1) We work five days a week for nine hours (including two tea breaks) plus a half-hour lunch break (excluded for the purpose of calculating working hours). This means we are working 45 hours per week. Please correct me if I am wrong.

2) Under Section 64, it is mentioned, "The total number of hours of work in any day shall not exceed ten." Does that mean the total working hours, including rest, will not be more than ten hours? Please correct me if the calculation of my working time mentioned above is in line with the act.

3) Assuming an employee works OT for 3 hours on any particular day in a week, then the total working hours would sum up to 48 hours per week. But for the purpose of OT per day, it would mean he has worked 12 hours. Do I still need to pay OT for this working?

Regards,
Abhilash

Working Hours in a Factory According to the Factory Act

In the Factory Act of 1948, CHAPTER-4:

Section 51 of the Factories Act, 1948, prescribes that no adult worker shall be required or allowed to work in a factory for more than forty-eight hours in any week. Further, Section 54 stipulates that, subject to the provisions of Section 51, no adult worker shall be required or allowed to work in a factory for more than nine hours in any day. However, there is a provision to this section which states that, subject to the prior approval of the Chief Inspector, the daily maximum hours specified in Section 54 may be exceeded to facilitate the change of shifts.

Section 52 of the Act states that no adult worker shall be required or allowed to work in a factory on the first day of the week, i.e., the weekly holiday. Section 53 of the Act further states that if the worker is deprived of any of the weekly holidays for which provision is made in Section 52, he shall be allowed, within the month in which the holidays were due to him or within the two months immediately following that month, compensatory holidays of equal number to the holidays so lost. Section 55 of the Act lays down that the periods of work of adult workers in a factory each day shall be so fixed that no worker shall work for more than 5 hours before he has had an interval for rest of at least half an hour. The Chief Inspector of Factories can exempt any factory from this provision so, however, that the total number of hours worked by a worker without an interval does not exceed six.

Section 56 of the Act stipulates that the period of work of an adult worker in a factory shall be so arranged that, inclusive of his intervals for rest under Section 55, it shall not spread over more than ten and a half hours on any day. The Chief Inspector may, however, increase the spread over up to twelve hours on specific grounds.

Regards,
Manish

My understanding is that work hours apply to those who can claim overtime only. I would like to point out that if your company wants to follow the EICC CoC, then, besides fulfilling Indian laws and regulations, the total work hours (including overtime) should not exceed 60 hours per week too.

Thank you.

Dear Kumar,

As per the Factory Act, a "worker" means a person employed directly, or by or through any agency (including a contractor), with or without the knowledge of the principal employer, whether for remuneration or not, in any manufacturing process, or in cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process. In Section 7, the manager is the representative of the occupier or occupier.

According to the Factory Act, a worker must be paid for overtime if they work in a factory for more than nine hours in any day or for more than forty-eight hours in any week. They shall, in respect of overtime work, be entitled to wages at the rate of twice their ordinary rate of wages.

Regards,
Manish

Dear Manish,

Thank you for your input. I need some clarification. The employees designated as a Manager, for example, a Sales Manager in a Pvt. Life Insurance company to whom no manager reports and who handles a team of insurance agents recruited on a commission basis. In the case of a Pharma Company, an Area Manager who is a first-line manager handling a team of medical representatives and a Regional Manager who is a second-line manager handling a team of Area Managers and medical representatives.

Eligibility for Overtime

The question is whether these employees - Sales Manager, Area Manager, Regional Manager - are eligible for overtime. Sales Manager, Area Manager, and Regional Manager are required to work for more than 9 hours a day in the office, and many times on off days, including Saturdays and holidays. They mark attendance in the register but do not mark attendance online since online attendance does not work on off days. Sometimes, they are asked to report for duty on off days by SMS or phone calls.

These employees - Sales Manager, Area Manager, Regional Manager - are considered workmen as per some court decisions. What is the remedy for them? I would highly appreciate responses from all members.

Thank you.