Global Compliance Guide

Hours & Pay Regulations

Normal Working Hours

In the case of shops and commercial establishments, working hours are governed by the state-specific Shops and Establishments Act. Depending on the state in which the workplace is located, normal working hours can be 8 or 9  in a day and 48 in a week.

Working hours in the case of manufacturing facilities is governed by the Factories Act.


Employees covered by the Minimum Wages Act are entitled to double pay for hours worked in excess of the hours constituting a normal workday. Similarly, according to the respective State Shops and Establishments Act,  any work beyond 8 or 9 hours per day or 48 hours per week is considered overtime and is entitled to overtime pay. 


For most of the states, the total number of working hours in a day must be 12, limiting the maximum number of overtime hours in a day at 2 hours.


If a worker is employed in a factory the provisions of the Factories Act, 1948 apply.  A worker works for more than nine hours in a single day or for more than 48 hours in a single week, he is entitled to wages at twice the ordinary rate of wages.

Night Work

Working of female employees beyond permissible hours in factories & commercial establishments is generally prohibited. Working beyond permissible hours can only be on rare occasions and not a norm. Any deviation from this requires prior permission of Government Authorities.


Meal or rest breaks of half an hour to an hour are required for employees working a continuous period of five hours. The total number of hours worked by a worker without an interval does not exceed six. 


Daily and Weekly Rest

Employees must have a minimum of 12 hours free between shifts and one rest day per week. All employees must receive a day of rest in every period of seven days. The day of rest is ordinarily Sunday, but the employer may fix any other day of the week as the rest day for any employee or class of employees.


Provisions relating to working on weekends are not specified under any law or act. But provisions relating workdays are provided in the Standing Orders of establishments as per the Industrial Employment (Standing Orders) Act, 1946 which specifies provisions relating to employees working days and their off days for working on weekends. 

Work On Rest Days

In most states, an employee may not be required or even allowed to work on a scheduled rest day unless he or she has or will have a substitute rest day of rest for a whole day on one of the five days immediately before or after the rest day. 

Public Holidays

National and Festival Holiday Act, which is applicable to all establishments in the country, irrespective of under which law it is formed it is mandatory to grant leave on the following 3 days, i.e. 26th January (Republic Day), 15th August (Independence Day) and 2nd October (Gandhi Jayanti). There are provisions relating to the National Holidays which are mentioned under the Shops and Establishment Act of the concerned states. The number of festive holidays can differ from state to state. So there applicability depends upon the state legislation. Hence the rest of the festival holidays depends on the discretion of the concerned States and establishments.


An employer is required to provide 5 to 9 festival holidays, the number depending on the state in which operations are located. Generally, a list of holidays is published by the state government every year, and employers are required to choose the holidays they will observe. In certain states, employers are required to display the list of holidays in a conspicuous location in the workplace.  Employees who are required to work on a public holiday are entitled to extra  premium pay, or substitute holiday according to the applicable state shops act

Annual Leave

Vacations commonly referred to as “annual” or “privilege” leave in any organization (other than a factory) are governed by the provisions of the relevant state-specific Shops and Establishments Act. The number of leave entitled to an employee depends upon the state in which the establishment is located. 


For example, in Maharashtra, employees are entitled to 21 days of annual leave and may accrue up to 42 days whereas, in  Delhi, employees receive 15 days of annual leave and may accrue 45 days.

Minimum Wage

The minimum wages in India are segregated into various categories dependant upon the type of work and can differ state-wise.





The minimum wage stated above is subject to change and may not be updated. Kindly access the link to get current rates.


Special Leave

The leave policy of an establishment should be in concord with the leave provision of the respective state’s Shops and Establishments Act. The said leave policy cannot be less beneficial than that mentioned by the respective state’s Shops and Establishments Act.
Sick/Casual/Personal Leave

Generally governed by the state-specific Shops and Establishments Act. Not all states separately define casual and sick leave, and the number of days of such leave to which employees are entitled varies from seven to 12 depending on the state in which the workplace is located. In the manufacturing sector, casual/sick leave is governed by the Industrial Employment (Standing Orders) Act, 1946, under which employees are entitled to up to 10 days of leave. Casual/sick leave cannot be accumulated or cashed out. Emergency, accidents or unexpectedness is beyond the control of an employee. To address such situations, employees are allowed to take casual leave.

Bereavement Leave

Some companies allow 3-5 days of bereavement leave in case of death in an immediate or extended family.

Maternity Leave

In 2017, new maternity benefit rules came into force requiring businesses with 10 or more employees to provide 26 weeks’ paid leave during an employee’s first two pregnancies and 12 weeks’ paid leave for adoptive and surrogacy commissioning mothers. Female employees who have worked for a given employer for at least 80 days in the 12 months immediately preceding the date of expected delivery are eligible for the extended benefits, provided they give the employer written notice seven weeks before the expected date of delivery. The 26 ­week leave entitlement applies only to the first and second pregnancy. For the third child and after, only the original 12 weeks are available. Adoptive mothers are entitled to paid leave under the new legislation only if the adopted child is less than three months old. Maternity Benefit Act, 1961, No. 53, §§ 5(2), 6(2), 9, 10, 12; Maternity Benefit Amendment Bill, 2016, § 4.

Paternity Leave

Allowing the paternity leave of male employees is not a legal requirement in India. However, some employers have policies to let their male employees avail 3-5 days of paternity leave. If it is compulsory to be married to avail paternity leave is open for debate.

Last updated on: July 6th, 2021