ekarmika: New Mandatory Karnataka Shops and Establishment Act, 1962 (2024)

Last Updated on May 12, 2022 by Kanakkupillai

The obligatory registration of Karnataka Shops and Establishment Act, 1962 for companies, persons, and legal entities who is setting up a shop or commercial establishment in the state and these act-oriented documents are considered important for

• employers
• their human resources (HR) departments

e – Karmikais a facility for Registration and Renewal of Establishments under the Karnataka Shops and Commercial Establishments Act, 1961 ; which is one of the State Labour Laws and Rules being enforced by the Department of Labour, Karnataka.
The Karnataka Shops and Establishment Act prohibits the employment of a child at any establishment. A child is any person who has not completed fourteen years of age. Also, young person and woman cannot be required or allowed to work whether as an employee or otherwise in any establishment during night.
TheKarnataka Shops and Establishment Actwas introduced to regulate the hours of work, annual leave with wages, wages and compensation, employment of women and children and other aspects ofshopsor commercialestablishment.
Under the pursuance of the Act,Shop and Establishment License is compulsory for all business entities. If a person has established any business entity than he is required to obtain a shop and establishment license for the purpose of carrying business within 30 days of commencement of business.

It regulates establishments in the following commercial places

1. Employees,
2. Annual leaves for wage calculation,
3. Wages and compensation,
4. Womenand Children Employment,
5. Other perspectives

The state business developers and their employers must document this key statutory requirement and already developed or established firm must ensure their HR policies and handbook are compliant. The following are included under commercial establishments:

• Commercial,
• Trading,
• Banking,
• Insurance entity,
• An establishment,
• Administrative services

ekarmika: The employers working in departments like

1. Office work
2. Refreshment house – a hotel, restaurant, a cafe or any others.
3. Public Amusem*nt – a theatre or any other place or entertainment.

ekarmika: The Act Definition

“The Act defines shops as a place where any trade or business is carried on or services are rendered to customers, including offices, storerooms, and godowns (warehouses). The term does not include shops attached to a factory within the scope of the India’s Factories Act, 1948.”

ekarmika: Licensed Business

• Office includes – Federal, state government, or local authority
• Public Sanitation Industries – Entity providing power, light, or water to the public, or any water transport service, postal, railway survey, telephone or telegraph service, any system of conversancy;
• Dining cars in Railways
• Care Establishments or treatment of the mentally unfit, infirm or the sick;
• Establishments from the food corporation of India.
• The offices of legal and medical practitioners (offering in case have not employed more than three persons)
• A banking company’s offices
• Persons who are working in the positions of management in any firm;
• Persons working on inherently intermittent positions (care takers, drivers, canvassers, or watch and ward staff)
• Complementary or preparatory work persons engaged directly (clearing and forwarding clerks responsible for the dispatch of the goods)

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Registration Process:

Mandatory for all new shops or commercial establishments in Karnataka irrespective the employers strength of more than one employee or note had to apply will apply under the Act within 30 days of business establishment.
e-Karmika is the online state government portal, which has started with online facility for registration under the Act.

Renewal Or Amendment Of Licenses

The inspection or approval might take 15 days from the acceptance of the application through online.
Validity of registration is five-year periodand renewable after expiry.
The registration fees depends on the number of employers – no employee INR 250 (US $3.7)
-More than 1000 employee INR 50,000 (US $728).

The procedure of Karnataka Shops and Establishment registration:

• Click on New Registrations and fill the form online, submit it.
• Username and Password will be generated and send to your mobile number
• Fill and submit the application form online to Chief Inspector of your concerned regional circle office
• Take Challan from any nationalized bank based on your number of employees
• Make attachment of necessary documents along with the Bank Challan
• Get the acknowledgement number
• Submit the physical copy of online application form in the particular regional circle
• After verification by the Senior Labour Inspector, if everything is well; you shall be granted the registration certificate
• Obtain the certificate

ekarmika: Requirements and Documentation Process:

Form-A completion with the following supporting documents:

• Commercial address proof;
• Identity proof and Permanent Account Number (PAN) card copy of proprietor, partners or directors;
• PAN copy of the entity;
• Registration documents – partnership deed or memorandum of association (MOA) of the company; and
• Fee payment challans.

What are the Benefitsof aLabour Card?

Business Key compliance

Hours of operation

The Act provides for nine-hours a day or forty-eight hours a week work schedule for every employee in the state.
For those working overtime, it mandates employees to pay overtime wages at twice the rate of normal wages.

Employment of women and children

The Act prohibits companies from employing children under 14 years of age. It also prohibits night shift for women employees or young persons between the age of 14 to 18 years.
Information technology (IT)or biotech companies with the requirement of women employees with night works are definitely to obtain special permission from authorities.

Weekly holidays

It is mandatory for all establishments to remain closed for at least one day of the week and provide a day rest to its employees.
The weekly holiday provision, however, is not available to medical shops, general stores, theatre, petrol bunks, lodges, hotels, clubs, hostel, and companies offering IT or biotechnology related services.

Annual leave with wages

Every employee working in an establishment in Karnataka is allowed to avail a leave with wages at the rate of one day for every twenty days of work performed. For young persons, the provision is more relaxed offering a leave with wages at the rate of one day for every fifteen days of work performed.”
The above mentioned are given as per the Act statement.
Thus….
Mandatory filing of Karnataka Shops and Establishment Act, 1962 is to be completed before deadline.
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