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RELAXATIONS FROM PROVISIONS OF SHOPS & ESTABLISHMENTS IN TELANGANA – A PROGRESSIVE LABOUR REFORM

The extension of labour law relaxations in Telangana represents a strategic policy intervention with far-reaching implications for the state’s economic landscape. These exemptions from key provisions of the Telangana Shops & Establishments Act (TS&E Act) have positioned the state as a premier destination for global technology companies seeking operational flexibility and cost advantages. The timing of this extension is particularly significant as Telangana’s IT sector has demonstrated remarkable resilience, achieving an 11.3% growth in exports during FY 2023-24, reaching ₹2.68 lakh crore, substantially outpacing the national average growth rate of 3.3%.

This policy framework enables establishments to synchronize their operations with global business cycles, facilitating seamless collaboration across different time zones through the “follow-the-sun” model. By allowing flexible working hours and night shifts, Telangana-based operations can provide real-time support to clients and partners in North America, Europe, and the Asia-Pacific regions; supporting Telangana’s effort in cementing itself in today’s interconnected global economy.

EXEMPTION FOR IT-ITES ESTABLISHMENTS IN TELANGANA

As a step towards Ease of Doing Business, the Government of Telangana adopted the exemption provided to all IT-ITES Establishments in the combined State of Andhra Pradesh from the provisions of Sections 15, 16, 21, 23, 31 and 47 (1) (2) (3) & (4) of the A.P S&E Act for a period of 5 years w.e.f 30.05.2013[1]. These relaxations were extended vide a subsequent G.O. for a further period of 5 years w.e.f 30.05.2018[2]. Thereafter, the said G.O was further extended for a period of 1 year w.e.f 30.05.2023[3]. In 2024, subsequent G.O extending the relaxations from provisions of the TS&E Act was issued for a further period of 4 years w.e.f. 30.04.2024[4], effectively extending the relaxation up to 30.04.2028, subject to certain conditions.

All the IT & ITES Establishments situated in Telangana are exempted from complying with the following provisions:

PROVISION DESCRIPTION
Section 15: Opening and closing hours Shops and commercial establishments are required to adhere to the opening and closing hours prescribed by the government.
Section 16: Daily and weekly hours of work The Telangana Shops Act prescribes the employees shall work up to a maximum number of 8 hours per day and up to a maximum number of 48 hours/week. The provision also states that an employee may work up to a maximum of 6 hours of overtime in a week.
Section 21: Special provision for young Young persons are prohibited from working before 6 AM and after 7 PM.

[1] G.O. Ms. No. 22, LET&F (Lab-IV) Department, Dated 21.06.2013.

[2] G.O. Ms. No. 25, LET&F (Labour) Department, Dated 25.07.2019.

[3] G.O. Ms. No. 30, LET&F (Lab-I) Department, Dated 15.11.2023.

[4] G.O. Ms. No. 5, LET&F (Lab-I) Department, Dated 07.06.2024.

[5] G.O. Rt. No. 476, LET&F (Lab-I) Department, Dated 13.10.2022.

PROVISION DESCRIPTION
Section 23: Special provision for women Women employees are prohibited from working before 6 AM and after 8:30 PM i.e. night-shift.
Section 31: Other holidays The Telangana Shops Act prescribes nine mandatory national and festival holidays on which establishments are to grant holidays to employees.

However, the said exemptions for the IT & ITES Establishments are subject to the following conditions:

  • Weekly working hours have been fixed at 48 hours.  For the work done beyond 48 hours, employee is entitled for overtime wages.
  • Every employee must be given a weekly off.
  • The management is permitted to engage young and women employees during the night shift subject to provision of adequate security during the course of employment and to and fro transport from their respective residences.
  • Every employee shall be given a compensatory holiday in lieu of notified mandatory national and festival holidays, with wages under the provision to sub-section (2) of section 31 of the Telangana Shops Act if they work on such notified holidays.
  • Employers shall obtain bio-data of each driver and conduct pre-employment screening of the antecedents of all drivers employed on their own or through outsourcing. All the details of the drivers shall be available with the respective companies.
  • The schedule and route of the pickup and drop shall be decided by the supervisory officer of the company on every Monday (if Monday is holiday the next working day in a week).
  • The telephone number particularly mobile phone numbers and addresses of the women employee shall not be disclosed to unauthorized persons and have a control room / travel desk for monitoring vehicle movements and provide security guards for night shift vehicles.
  • General exemption from maintenance of various statutory registers in hard copies and recognition of soft copy of Registers as sufficient compliance.

If any of the conditions as listed in the Notification are violated, the exemption orders issued to the company shall be revoked by the government at any time without any prior notice. 

WORKFORCE EXPANSION & DIVERSITY – EXEMPTION FROM PROVISIONS PROHIBITING NIGHT SHIFT FOR WOMEN

The relaxations have had a transformative impact on workforce demographics, particularly in expanding opportunities for women in the IT sector. Attempting to further these relaxations, the Government of Telangana has issued a G.O. exempting all shops & establishments from the applicability of provision related to working hours of women between 8:30 P.M to 6:00 A.M, subject to certain prescribed conditions.

  • Consent of women employees shall be obtained in writing to work in night shifts.
  • The establishment shall provide transport facilities from the residence of the woman employee to the workplace and back, free of cost and with adequate security. Such transport facility shall have GPS for tracking and monitoring.
  • Employment of women employee shall be on rotation basis.
  • Safety and security measures including provision of shelter, rest rooms, lunch rooms, night crèches and ladies toilets, protection from sexual harassment, employment of at least five (5) women employees together.
  • The said relaxation shall not apply to a woman employee during the period of sixteen (16) weeks before and after her childbirth, of which at least eight (8) weeks shall be before the expected childbirth.
  • Adequate number of security guards shall be posted during night shift.
  • Employers shall obtain bio-data of each driver and conduct pre-employment screening of the antecedents of all drivers employed on their own or through outsourcing. All the details of the drivers shall be available with the respective companies.
  • The schedule and route of the pickup and drop shall be decided by the supervisory officer of the company. The Company shall have a control room / travel desk for monitoring vehicle movements and provide security guards for night shift vehicles.

If any of the conditions as listed in the Notification are violated, it may lead to cancellation of the Registration Certificate and /or withdrawal of the above exemption in respect of such establishment.

AN APPROACH TOWARDS A PROGRESSIVE LABOUR LEGAL LANDSCAPE

Telangana’s approach to labour law relaxations represents a thoughtful model of progressive reform which recognizes the unique operational requirements of knowledge-intensive industries while maintaining robust worker protections. The exemption allowing women to work night shifts, with appropriate safety measures, has been particularly impactful in creating more inclusive workplaces, leading to a conducive environment for continued innovation and growth in Telangana.

The continued extension of these exemptions until 2028 provides long-term policy stability that enables businesses to plan investments and operations with confidence. As Telangana advances toward its vision of doubling its Global Capability Center (GCC) footprint and becoming a $5 trillion economy, these labour law relaxations will enable sustainable, inclusive growth that benefits businesses, workers, and the economy as a whole.

Rituka Mane

Associate