Labour Law Compliance Checklist

Labour law compliance refers to a set of accepted terms or conditions of employment. It refers to several regulatory compliances, including the wages act, the Workmen’s compensation act, the contract labour act, the factories act etc.

Business is tough in India. Apart from the business side, the company is also obligated to meet statutory compliance requirements. There are various laws and acts that the business must comply with or face punitive action. There are laws at the central level, and there are state government laws applicable to businesses.

Updated Labour Law Checklist

The best way to ensure compliance is to prepare a labour law compliance checklist and tick off each item on the list every month by a person assigned to the task. One can just as well use HR automation software to ensure compliance. Various types of businesses must prepare a compliance checklist under labour laws according to their sphere of operations.

A representative labour law compliance checklist would look like this:

• The Building and Other Construction Workers Act 1996, Form 1 to be submitted 30 days before the commencement of work and Form 1 within sixty days from the commencement of work.
• The Building and Other Construction Workers Welfare Cess Act 1996: A demand draft for 1% of the project cost to be submitted within 30 days of the completion of the project.

The Factories Act 1948

• Form 1 with annexures to be completed on completion of construction project
• Form 2 to be submitted on approval of factory building plans
• Form 1 on commencement of work
• Form VI B after work has started
• Form A and B are to be submitted when construction starts
• The Employees’ Provident Fund and Miscellaneous Provisions Act 1952—Coverage proforma on commencement of work besides monthly deductions and form filing.
• The Employees State Insurance Corporation Act 1948, Form 01, at the time of commencement of work.

List of Labour Compliances

There are other laws as well that necessitate the preparation of labour law compliance checklist. Some of these are:

• Shops and Commercial Establishment Act
• The Professional tax Act
• The Labour Welfare Fund Act
• The Minimum Wages Act 1948
• The Payment of Bonus Act, 1965
• The Payment of Gratuity Act 1972
• The Equal Remuneration Act 1976

HR employees would need to prepare a labour law compliance calendar-type checklist to ensure compliance. For instance, TDS must be deducted and deposited by the 7^th of the following month with Form ITNS 281.

As for the Factories Act, each state may have its own rule, but returns must be filed by the 15^th of the month. EPF must be deposited by the 21^st of the month. ESI deductions and forms must be completed by the 21^st of the following month. Quarterly income tax returns are on Form 24Q and Form 27! It needs to be filed by the 31^st of the applicable month for the quarter.

As can be seen, it is no easy task to keep track of all necessary compliances because certain acts and laws are applicable under certain conditions, such as a certain number of employees or a certain pay limit. HR staff will need to ensure that their compliance checklist under labour laws also reflects the latest amendments and incorporates such changes in their filings and returns.

Then there are specified dates by which deposits should be made and forms filed with the appropriate authorities. There may be monthly returns, quarterly returns, or annual returns that must be filed in time according to the stipulations of various acts and rules.

Errors are bound to creep in, and there may be errors of omission or commission that could result in penalties. The best solution is to outsource compliance to experts or use the right HR automation software. Not all laws and acts apply to all types of businesses, so one must know precisely which acts apply and which rules apply so as to prepare a calendar of checklist and follow them rigorously for full compliance.

 

Contact Us For Business Enquiries