Get 20% off this month when you try our services!
Signed in as:
filler@godaddy.com
Statutory Compliance
The adherence and fulfillment of legal standards, rules, and guidelines established by statutes in handling staff members within an organization are all referred to as statutory compliance in HR.
It includes the responsibility of organizations to adhere to labor laws that both the central and state governments in India have enacted.
These Labour Law compliances in India are mandatory and failing to adhere to them shall lead to severe consequences. But worry not, SalveHR is here to guide you through the entire process and make your organization a statutorily responsible one!
What is Statutory Compliance?
The term "statutory" can be defined as "enacted by statute" or "regulations," while "compliance" refers to an agreement. The combination of statutory compliance results in an agreement to adhere to regulations.
Adherence to statutory compliance offers substantial security, spanning from employees' minimum wages to the company's ongoing operation. Each country establishes its own set of regulations for organizations to adhere to, which accumulates annually.
Adhering to these laws necessitates substantial funds and effort from organizations. Nevertheless, it is only feasible for some organizations, tiny and medium-sized enterprises, to allocate substantial money to this endeavor.
The complexity of compliance has increased, and so has the risk of penalties for noncompliance. To maintain a competitive edge, it is imperative that you:
- Adhere to all relevant HR labour laws, including those of the national, state, and local governments.
- Be prepared for the possibility of an audit by enforcement agencies that may impose penalties and fines for noncompliance.
- Recognizing that a lack of awareness regarding compliance obligations is not generally a valid justification for noncompliance of such laws
- It is imperative to be aware that lawsuits related to HR noncompliance can result in a company's financial ruin.
As the frequency and scope of government agency audits and employee litigation increase, all organizations must adhere to the constantly evolving HR compliance mandates regardless of their size or scale.
Failure to comply with this requirement may lead to legal penalties, fines, and repercussions. SalveHR is well versed with all the requisite statutory compliances and can help your company with the same!
Importance of HR Compliance
Any business that employs even one employee is obligated to adhere to HR compliance. The reason for this is as follows:
To circumvent legal obligations: Employers are legally obligated to adhere to diverse human resources laws and regulations. Costly litigation, fines, and other penalties may ensue unless this is accomplished.
For the sake of safeguarding employees: The purpose of HR laws and regulations is to protect employees from discrimination, harassment, and other types of unjust treatment. By adhering to these laws, employers can guarantee that their employees are treated with respect and equity.
To establish a positive work environment: Employees experience increased feelings of security and appreciation when they know their employer adheres to HR laws and regulations. This can result in improved motivation, output, and retention.
To preserve a favorable reputation: Companies that are known for being HR compliant are regarded as more legitimate and trustworthy. This can lead to higher customer loyalty and alliances.
Preserving Ethical Standards: Compliance with labor regulations and legislation ensures businesses maintain moral standards in their HR practices and avoid mistreating employees.
Minimizing Legal Risks: Noncompliance with lawful obligations can expose corporations to legal risks and lawsuits brought by workers, labor unions, and regulatory organizations.
The Government Deployed Rules and Regulations
Take a peek at some of the central government-implemented rules for organizations that employ workers. If you find these regulations overwhelming, consider utilizing SalveHR’s compliance services. We will assist in streamlining your statutory compliance processes.
The Industrial Disputes Act of 1947
The Industrial Disputes Act, implemented in 1947, made arrangements for investigating and resolving conflicts between employee-employee and employee-employer. The primary goal of this Act is to 'preserve peace and harmony in the workplace in Indian Establishments.'
The Equal Remuneration Act of 1976
The Equal Remuneration Act, as its name implies, is a gender-based industrial remuneration equality policy. It guarantees that all employees receive equal compensation, regardless of gender, to prevent gender bias. It was introduced because women were compensated lesser than men, even though the amount of work was equivalent. Severe fines and penalties may result from noncompliance with this Act.
The Maternity Benefit Act of 1961
The Maternity Benefit Act was enacted in 1961. Proper compliance can guarantee the enforcement of these laws by implementing an appropriate leave management system. It also grants mothers specific months of paid leave during their maternity to care for the child. She can resume her employment after giving birth without any difficulties.
The Payment of Bonus Act (Amendment), 2007
The annual incentives for employees in organizations, including factories with more than 20 employees, are guaranteed by the Payment of Bonus Act. The establishment's profit and the employees' salary are the factors which help in determining the yearly incentive.
The Payment of Gratuity Act, 1972
The Payment of Gratuity Act ensures that employees in the private sector, businesses, oilfields, ports, factories, railways, and mines receive gratuities and incentives. A gratuity is a form of financial assistance deducted from an employee's monthly compensation and subsequently provided after retirement. Gratuity is permitted to an employee who has given uninterrupted service for at least five years for a specific organization.
The Employees' Compensation (Amendment) Act, 1923
Many services require hard labor, risk of damages, critical accidents, or even death. Employees’ Compensation Act, implemented in 1923, safeguards employees or their dependents using compensation during any circumstances mentioned above.
The Payment of Wages (Amendment) Act, 2017
Payment of wages acts ensures reimbursement of employees on time without any adjustments or deductions other than those specified by the government authority.
The Employees' Provident Fund & Miscellaneous Provisions (Amendment) Act, 1952
The Statutory Provident Fund Act is implemented to ensure employees' social security. For any organization that employs more than 20 personnel, the Employees' Provident Fund Act holds them accountable. To facilitate this, each employee contributes a portion of their salary to the Provident Fund.
The Employees' State Insurance (ESI) Act of 1948
The Employees' State Insurance (ESI) Act of 1948 guarantees complete medical coverage for non-seasonal factories, including power plants with over 10 employees and non-power and other businesses with over twenty workers. This coverage includes sickness, maternity, and injuries.
The Minimum Wages Act of 1948
The Indian Parliament enacted the Minimum Wages Act in 1948, which stipulates that it provides minimum wages/salaries to skilled and menial laborers. The Constitution has established a specific living wage encompassing primary livelihoods, such as health, sustenance, comfort, education, and dignity.
The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act of 2013
This legislation addresses the subject of sexual harassment in the workplace and requires employers to implement measures to prevent and resolve such incidents.
The Apprentice Act of 1961
This act establishes a regulatory structure for the training and welfare of apprentices in various industries, regulating apprenticeships.
The Interstate Migrant Workers (Regulation of Employment and Conditions of Services) Act of 1979
This act regulates the working conditions of interstate migrant workers and provides specific protections to secure their interests.
The Factories Act, 1948
This act establishes regulations regarding factory employees' health, safety, and welfare. It encompasses various aspects related to the protection of workers and the operation of factories.
The Trade Unions Act of 1926
This act regulates the establishment, registration, and operation of trade unions, which are organizations that advocate for the rights and interests of workers.
How can SalveHR help your company?
We provide knowledge-driven, technology-enabled industrial, financial, and labor compliance solutions throughout India. Our domain-specific services are designed to help businesses manage compliance, register, and obtain the requisite licenses across various domains.
SalveHR's statutory compliance services are the dependable foundation for businesses that strive for improved efficiency and seamless operations. Lend us your statutory requirements, and we will ensure that your attention is consistently directed toward the expansion and prosperity of your business. Our services are the go-to choice for businesses prioritizing corporate governance, using precautions to mitigate compliance, financial, or reputation risks.
Conclusion
In conclusion, the constantly changing HR Statutory Compliance in India demands a proactive and flexible approach from HR professionals. Remaining on top of these changes is not just an ethical responsibility but a strategic imperative for organizations seeking to create an enjoyable place to work and mitigate legal risks.
SalveHR can confidently navigate the evolving legal landscape and contribute to the organization's overall success and the organization's continuous learning, establishing strategic partnerships, adopting robust policies, employing technology, and undertaking proactive audits.