Can an Occupier and Manager Be the Same Person Under FA? Seeking Clarification

Hi, kindly let me know if an occupier and a manager under FA can be the same.

Regards, Mahesh

Difference Between an Occupier and a Manager

No. An occupier is different from a manager. An occupier is one who has ultimate control over the affairs of the factory as defined by Sec. 2(n) of the Factories Act. They control all administrative, financial, and manufacturing decisions relating to a factory. In the case of a partnership firm, any one of the partners may be the occupier. In the case of a company, a managing director or any of the directors can be the occupier. The occupier is accountable for the overall functioning of the factory.

A manager is not responsible for the overall control of the factory. According to Sec. 64, a manager is an officer of the factory, holding a position of supervision, control, and confidentiality. A manager has limited power to make decisions relating to the daily and routine functions of the factory.

Regards,
B. Saikumar
HR & Labor Law Advisor
Mumbai

Relevant sections 7(4) and 7(5) of the Factories Act, 1948 may be read as follows for your query:

Section 7(4): Whenever a new manager is appointed, the occupier shall send a written notice to the Inspector and a copy to the Chief Inspector within seven days from the date on which such person takes over charge.

Section 7(5): During a period for which no person has been designated as the manager of a factory, or during which the designated person does not manage the factory, any person found acting as the manager, or if no such person is found, the occupier himself, shall be deemed to be the manager of the factory for the purposes of this Act.

This indicates that if no person is appointed as the manager by the occupier, then the occupier himself shall be deemed the manager of the factory for the purposes of this Act.

Regards,
R.N.KHOLA

[Welcome Skylark Associates](http://www.skylarkassociates.com/)

Mr. Khola has clarified the point for you. For more details, you may refer to the Act attached herewith. Related provisions have been highlighted as required.

Regards.

As already stated, the Factories Act envisages a Factory Manager as a nominee of the "Occupier" entrusted with the task of facilitating due compliance with the Act. He has been assigned specific responsibilities under the Act. For obtaining a Factory License, the occupier has to name the Factory Manager. In case the named Factory Manager is not in employment, it is in the interest of the Occupier to nominate the successor and inform the Factory Inspector. If he fails to do so, the entire responsibility of the Factory Manager would fall on his shoulders.

Regards,
KK

Occupier and Manager Roles in a Factory

A factory manager or owner can be an occupier of the factory. If the factory does not have any factory manager, then the owner can be an occupier and factory manager for the sake of the factory license. In case of any incidents happening in the factory, such as accidental death, the factory director will lodge the case against the occupier as well as the factory manager.

Regards,
Rajeev Dixit

Difference Between Occupier and Factory Manager

Occupier and Factory Manager are different legal entities. To be an occupier, a person should be at least a director of the company. However, a person cannot have two designations for the same factory.

Regards,
Sachin Verma
[Phone Number Removed For Privacy Reasons].

Simply put, an occupier can be entrusted with the manager role, but a manager cannot be considered as an occupier.

Regards,
P. Palanivelan

Occupier vs. Manager Under the Factories Act 1948

According to the Factories Act 1948, the occupier is a person who has ultimate control over the affairs of the factory. The landmark case in this regard is JK Industries Ltd and others v. Chief Inspector of Factories and Boilers and others (Supreme Court, 1996), where the Supreme Court stated that the word "ultimate" in common parlance means last or final. Therefore, where a company owns or runs a factory, it is the company that has ultimate control over the affairs of the factory and would therefore be the occupier.

Essentially, the law as declared by the Supreme Court was that a company cannot nominate any one of its employees or officers, except a director of the company, to whom the effective control can be vested, as the occupier of the factory.

There is a vast difference between a person having ultimate control of the affairs of a factory and one who has immediate or day-to-day control over the affairs of the factory. The manager or any other employee, of whatever status, can be nominated by the board of directors of the owner company to have immediate or day-to-day or even supervisory control over the affairs of the factory.

Therefore, a company can nominate a person as a Manager to carry on the day-to-day affairs of the factory to assume responsibility for the liabilities, if any, arising. However, the fact that the director designated as the occupier is ignorant about the management of the factory, which has been entrusted to a manager or some other employee, and is himself not responsible for the contravention does not absolve him of the occupier's primary liability. The manager, at best, can also be jointly held liable (section 92).

Regards,
Rajusiachen

Occupier vs. Manager: Understanding the Differences

An occupier can be a manager if no manager has been appointed. However, they are different as per the law and have different duties and responsibilities. Please let me know if you need further clarification or assistance.

Regards

In addition to what has been highlighted by others, an 'occupier' has business stakes in the company. He is a shareholder and is on the board of directors of the company.

Difference Between an Occupier and a Manager

An occupier is different from a manager. He is the one who has ultimate control over the affairs of the factory. He controls all administrative, financial, and manufacturing decisions relating to a factory. An occupier is accountable for the overall functioning of the factory, whereas a manager is not responsible for overall control of the factory.

As per Sec. 64, a manager is an officer of the factory, holding a position of supervision and control, and a position of confidentiality. A manager has limited power to make decisions relating to the daily and routine functions of the factory and for ensuring compliance with provisions of the Factory Act/Rules. An occupier has to be a director, and there is no such condition or binding for a manager.

Regards,
S.K. Tyagi
Sr. Manager-LEGAL
Mawana Sugar Works, Mawana
[Phone Number Removed For Privacy Reasons]

Can an Occupier and Manager Under FA Be the Same?

I read the question raised in this thread, which is: Can an occupier and manager under FA be the same?

The views expressed by many friends differ in opinion due to various reasons explained. But the relevant point is, where is the bar under the Act that an occupier cannot be the manager of the factory?

Keeping aside other aspects like sharing of responsibility, day-to-day management, etc., for the time being, let us examine the issue on a legal footing alone.

The word "Occupier" has been defined under Section 2(n) of the Act, but there is no definition prescribed for the manager in the Act.

Under Section 2(n), it is further explained who can be the occupier of a factory for the purpose of the Act. I am not going into the details of the section; only the important point is that an occupier should be a partner or member of the firm if it is a firm or association. In the case of a company, it should be one of the directors (who has ultimate control).

Now, going further in Section 7 of the Act, the name of the manager is required when the notice is sent to the director of the factory disclosing the name of the occupier. See 7(1)(f).

This section does not make it mandatory that the manager should be a different person than the occupier.

Furthermore, Section 7(5) of the Act makes it mandatory that if there is no person designated or found working as a manager in the factory, the occupier is deemed to be the manager for the purpose of this Act. Meaning thereby, there is no legal bar under the Act that the occupier cannot be the manager. If there was another intention of the legislator, this provision would certainly not be formed.

Moreover, when under Section 269 of the Companies Act, an MD or WTD may also be the manager for the purpose of the Companies Act, why can't an occupier (director) also be the manager under the Factory Act?

For the aforesaid conclusion, it is very obvious that there is no legal bar that an occupier and manager should be different persons. An occupier may also be the manager under the Factories Act.

However, keeping in view the other aspects like sharing of responsibility, etc., it is advisable always that it should be some other individual.

Regards,
PKJain

Occupier and Manager Roles Under the Factories Act

There is absolutely no bar for the occupier to be the manager, as is evident from Sec. 7(5) of the Factories Act. This is because the occupier is in charge of the overall control over the affairs of the company. However, the fact that the Act desires to have a separate entity as the manager is evident from the same provision, Sec. 7(5).

Sec. 7(5) states that the occupier shall be deemed to be the manager during the period when no person is designated as the manager or even if designated as the manager, he does not function as the manager. Thus, this section expects the occupier to act as a manager only until he designates someone as the manager, implying that he should designate someone as the manager. The intention of this provision does not seem to favor the occupier to be the manager eternally; it is only a stop-gap arrangement.

Furthermore, Sec. 7(1)(f) also requires the occupier to send notice to the Inspector intimating the name of the manager for the purposes of the Act. This also shows that the Act desires to have a separate entity called the manager. Thus, both the occupier and the manager are different. Although an occupier can be a manager, it is for a limited or temporary period. This is my view.

Regards,
B. Saikumar
Mumbai

As per the above suggestion of Mr. Sai Kumar and my own suggestion, the position is very clear. We hope you will be able to make a final decision and solve your problem.

Thanks,
Pkjain