The North News
Chandigarh, June 4
The Punjab Cabinet, led by Chief Minister Bhagwant Singh Mann, has approved a landmark amendment to the Punjab Shops and Commercial Establishments Act, 1958, aiming to reduce the compliance burden on small business owners and improve the ease of doing business across the state. In a meeting held at the Chief Minister’s official residence, the council of ministers decided that all establishments employing up to 20 workers would now be exempted from all provisions of the Act. According the Chief Minister’s Office to a spokesperson, this progressive step is expected to benefit nearly 95 per cent of businesses in Punjab, particularly lakhs of small shopkeepers.
However, even exempted establishments must submit relevant information to the Labour Department within six months of either the Act coming into force or the commencement of their business. This ensures that the government retains basic oversight without imposing heavy bureaucratic procedures.
Several reforms under the amended Act also aim to enhance workers’ welfare. Notably, the permissible overtime limit per quarter has been increased from 50 hours to 144 hours. Additionally, the daily spread-over period of work — which includes rest intervals — has been extended from 10 to 12 hours. Despite these extensions, the government has mandated that any work exceeding 9 hours per day or 48 hours per week must be compensated at twice the regular wage.
The registration process for commercial establishments has also been simplified. Businesses employing 20 or more workers will now receive deemed approval for registration within 24 hours of applying. Meanwhile, establishments with fewer than 20 workers are only required to submit basic details and are not obligated to register formally.
In another significant change, penalties under Sections 21 and 26 have been rationalised. The minimum fine has been raised from ₹25 to ₹1,000, while the maximum has increased from ₹100 to ₹30,000. To further support businesses, a three-month grace period will be provided between the first and subsequent offences, allowing time to achieve compliance without fear of immediate punitive action.
The Cabinet has also introduced a new Section 26A, which enables the compounding of offences. This effectively decriminalises certain infractions under the Act and eliminates the requirement for shopkeepers to appear in court, thereby further easing legal pressures on small businesses.
Importantly, the government emphasised that all rights and protections guaranteed to workers under various labour laws will continue to apply, ensuring that employees are not disadvantaged by the exemptions provided to their employers.
Chief Minister Bhagwant Singh Mann hailed the amendment as a transformative reform that balances business-friendly governance with the protection of workers’ rights, positioning Punjab as a forward-looking state for both entrepreneurs and labourers.
