Startup IT Company in Pune: What Legal Requirements Should We Be Aware Of?

Can anyone suggest to me what laws are applicable to a startup IT company with less than 20 employees on the roll? My company is located in Pune, Maharashtra.

Dear Nehasonwane22, First of all, there is no concept of on-roll and off-roll. There can be a direct roll or indirect roll, i.e., through a contractor or third party. You may have employees on a contractual basis, i.e., Fixed Term. You may have full-time employment or part-time employment.

Applicable Laws for Companies with Less Than 20 Employees

When you have less than 20 (that means 19 and fewer) employees altogether, including those through a contractor or third party and Fixed Term, part-time, etc., the following Acts are applicable to you in Maharashtra:

1. MLWF
2. PTax
3. ESI Act if you are a factory.

Applicable Laws for Startup IT Companies

Your Point: "Can anyone suggest to me what laws are applicable to a startup IT company with less than 20 employees on the muster roll? My company is located in Pune."

Kritarth Team Suggests

To boost survival, growth, consolidation, and thriving business profits stages, comply with the following laws to begin with and "properly & faithfully implement" the provisions applicable to your establishment, in letter & spirit:

1. The Shops & Establishment Act
2. "Sexual Harassment of Women at Workplace (P.P & R) Act 2013" to create a safe and secure workplace where everyone contributes their best towards creating wealth and wellbeing, where the fundamental rights to live with dignity and honor are guaranteed, and where no woman is subjected to sexual harassment. Constitute the internal committee for your establishment.
3. PF & Misc. Provisions Act 1952 and amendments
4. Payment of Wages Act
5. Gratuity Act
6. Other Acts and Rules gazetted by the Government of Maharashtra

Let your priority be to safeguard the employer/management and avoid penalties for non-compliance so that the revenue/fund is utilized for business purposes, not only business-related ones.

Kritarth Team of Special Educators has successfully served several Pune-based establishments in implementing the SHWW Act 2013 mentioned above.

Kritarth Team,
28th June 2018

In addition to what I said in my reply, you need to comply with the following other enactments:

Shop and Establishment Act

You need to apply for and obtain an S&E license if you have 10 or more employees. If you have less than 10 employees, intimate the department online in the prescribed format.

Payment of Wages Act

Pay salary by the 7th. Pay by cheque or bank transfer. Make only authorized deductions from salary.

Minimum Wage Act

Pay as per the prescribed minimum wage rates for your industry and location or more than it.

POSH Act

Comply with the provisions if you have more than 10 employees, including formulating an Internal Committee.

Payment of Gratuity Act

Comply with the provisions if you have more than 10 employees.

Maternity Benefit Act

If you have more than 10 employees (non-ESI members).

Employee Compensation Act

Comply with the provisions of the Act for non-ESI members.

Thank you.

Shop and Establishment Act for Commercial Establishments

Yours is a commercial establishment; therefore, it is covered under the Shop and Establishment Act. You need to obtain registration under the same.

The main objective of the Act is to protect the rights of both the employer and employee. The Shop and Establishment Act generally regulates the payment of wages, hours of work, terms of service, wages for holidays, leave policy, work conditions, overtime work, intervals for meals and rest, prohibition of employment of children, employment of young persons or women, maternity leave and benefits thereof, opening and closing hours, closed days, weekly holidays, dismissal, cleanliness, lighting and ventilation, fire safety and precautions, accidents, record keeping, etc.

Dear Prabhat ji, you advised the member to obtain registration under the S&E Act, as opposed to my advice to him to obtain S&E registration if he has 10 or more employees. In the case that he has less than 10 employees, he should inform the department online in the prescribed format.

Kindly verify the facts regarding the provisions of the law from your end and provide the correct position.

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Our company is an IT consulting Private Limited. What are the statutory acts we need to register for?