Employers across India, especially in industrial states like Maharashtra, must ensure full compliance with labour laws to avoid legal risks and ensure smooth operations. Two critical legal aspects that top-level management must be aware of are the overtime rules in Maharashtra and Section 25F of Industrial Dispute Act. Understanding and applying these correctly can help companies maintain compliance, avoid penalties, and manage workforce transitions effectively.
Overtime Rules in Maharashtra: What Employers Need to Know
The overtime rules in Maharashtra are governed by the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017, and the Factories Act, 1948. As per the law, employees should not work more than 9 hours a day or 48 hours a week. Any work beyond these limits is considered overtime.
Employers must compensate overtime at twice the regular rate of wages. This includes basic wages plus dearness allowance but excludes bonuses and other non-regular payments. Accurate record-keeping of attendance and working hours is crucial to demonstrate compliance during inspections. Companies failing to follow these rules can face penalties ranging from ₹2,000 to ₹100,000 or imprisonment, depending on the nature of the violation.
Section 25F of Industrial Dispute Act: Employer’s Obligation on Retrenchment
Section 25F of the Industrial Dispute Act outlines the conditions employers must meet before retrenching a workman who has completed at least one year of continuous service. It is applicable primarily to factories, mines, and plantations with a workforce governed by the Industrial Disputes Act, 1947.
The section mandates that:
- The employer must provide one month’s notice or pay in lieu of such notice.
- The employee must receive retrenchment compensation equal to 15 days average pay for every completed year of service.
- A notice must be served to the appropriate government authority.
For HR managers and factory owners, failing to comply with Section 25F can result in reinstatement orders, back wages, or penalties imposed by labour courts. Therefore, legal due diligence during retrenchment is essential for mitigating business risks.
Final Thoughts
Following the overtime rules in Maharashtra and adhering to Section 25F of Industrial Dispute Act is not merely about legal formality—it’s about risk management, brand reputation, and operational sustainability. Employers who proactively ensure compliance are better positioned for growth, scalability, and regulatory goodwill in India’s dynamic business environment.
