Applicability of Shops & Establishment Act to maternity homes, hospitals etc.

In a landmark verdict, the Bombay High Court on Friday, 2nd November 2018 upheld that the Maharashtra Shops and Establishment Act, 2017, encompasses medical practitioners, clinics, polyclinics, maternity homes, hospitals and dispensaries that employ 10 or more persons.

The erstwhile Bombay Shops and Establishments Act, 1948 was initially made applicable to shops and “commercial establishments”. However, in the year 1977, the State Government of Maharashtra amended the Bombay Shops and Establishments Act, 1948 with a view to including all professionals, including medical practitioners, within the ambit of the Bombay Shops and Establishments Act, 1948. A medical practitioner, had challenged the amendment before the Bombay High Court and the latter, vide its order of 10th July 2017, had struck down the amendment as unconstitutional insofar its applicability to medical practitioners and their establishments was concerned.

However, when the Government of Maharashtra introduced the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Bill, 2017 in the Maharashtra Legislative Assembly, the new bill categorically included doctors and hospitals in the definition of “establishment” with the State Government applying the provisions thereof to medical practitioners and their establishments if they employ 10 of more than employees.

Thus, while medical practitioners, clinics, polyclinics, maternity homes, hospitals and dispensaries that employ less than ten persons are exempt from applicability of this act those that employ ten or more must register under this Act and comply with its requirements in terms of work hours, leave etc. This position under law has now been validated by the recent judgement of the Bombay High Court.

What changed after the Act of 2017?

The erstwhile Bombay Shops and Establishments Act, 1948 used the term “commercial establishment” whereas the Maharashtra Shops and Establishment Act, 2017 dropped the term “commercial”, thus explicitly drawing non-commercial including charitable establishments employing ten or more persons within the ambit of the law

Definition of “establishment”?

Under the Maharashtra Shops and Establishment Act, 2017, “establishment” means an establishment which carries on, any business, trade, manufacture or any journalistic or printing work, or business of banking, insurance, stocks and shares, brokerage or produce exchange or profession or any work in connection with, or incidental or ancillary to, any business, trade or profession or manufacture; and includes establishment of any medical practitioner (including hospital, dispensary, clinic, polyclinic, maternity home and such others), architect, engineer, accountant, tax consultant  or any other technical or professional consultant; and also includes a society registered under the Societies Registration Act, 1860, and a charitable or other trust, whether registered or not, which carries on, whether for purposes of gain or not, any business, trade or profession or work in connection with or incidental or ancillary thereto; and includes shop, residential hotel, restaurant, eating house, theater or other place of public amusement or entertainment; to whom the provisions of the Factories Act, 1948 does not apply ; and includes such other establishment as the State Government may, by notification in the Official Gazette, declare to be an establishment for the purposes of this Act;

Thus, it is quite clear that in the state of Maharashtra, charitable trusts and societies, whether registered or not and whether carrying on, whether for purposes of gain or not, any business, trade or profession or work in connection with or incidental or ancillary thereto must register under this state law.

 

Tags:

Leave a Reply

Your email address will not be published. Required fields are marked *

Newsletter Signup
Get latest updates, news and surveys
Categories
Archives