In this article, Sirmaur Sudhakar from KIIT School Of Law discusses provisions of Bihar Shops and Establishment Act.


“The Bihar Shops and Establishments Act, 1953’’ received the assent of the President on 17 March 1954 and was brought into force on 15 February 1955.

The Act has been amended thrice since its formation, First in the year 1961, then 1963 and lastly in the year 1974.

The Act is a social piece of legislation of the State Government to regulate the condition of work and employment and therefore to secure maximum benefits to the employees working in different categories of establishment viz. shops, commercial establishments, residential hotels, restaurant, eating houses, theaters and other places of public amusements or entertainments. The employees are mainly protected by the provisions of this act.

The major breaches of the provisions of the Act consist of non-registration, non-renewal, opening of establishment before prescribed hours, closing of establishments later than prescribed hours, exceeding total hours, continuous work without rest interval, spread over, not granting privilege leave, keeping establishment open on weekly closed day, calling employees for work on their weekly offs, employing female employees after prescribed hours, employing child labour, not providing identity Cards to certain class of  employees, not paying wages as per rates prescribed under Minimum Wages Act, not maintaining prescribed register of employment, etc.

Important Definitions under Bihar Shops and Establishment Act

Child – “Child” means a person who has not completed the age of fourteen years

Young person– “Young person” means a person who is not a child and has not completed the age of eighteen years.

Shop– “Shop” means any premises where goods are sold, either by retail or wholesale or where services are rendered to customers and includes an office, store-room, godown, warehouse and workplace, whether in the same premises or elsewhere, used in connection with such sales or services, but does not include a restaurant, a residential hotel, eating house, theatre or other place of public amusement or entertainment.

Establishment– “Establishment” means an establishment which carries on any business, trade or profession or any work in connection with, or incidental or ancillary to any business, trade or profession and includes —

  1. Administrative or clerical service appertaining to such establishment;
  2. A shop, restaurant, residential hotel, eating house, theatre or any place of public amusement      or entertainment; and
  3. Such other establishment as the State Government may, by notification, declare to be an establishment to which the Act applies; but does not include a ‘motor transport undertaking’ as defined in clause (g) of section 2 of the Motor Transport Workers Act, 1961 (27 of 1961).

Employee– “Employee” means a person wholly or partially employed for hire, wages including salary, reward, or commission in and in connection with any establishment and includes ‘apprentice’ but does not include member of the employer’s family. It also includes person employed in a factory who are not worker within the meaning of the Factories Act, 1948 ( 63 of 1948), and for the purpose of proceeding under this Act, include an employee, who has been dismissed, discharged or retrenched for any reason whatsoever.

Employer– “Employer” means a person who owns or exercise ultimate control over the affairs of an establishment and includes a manager, agent or any other person in the immediate charge of the general management or control of such establishment.

Day– “Day” means a period of twenty-four hours beginning at midnight:

In the case of an employee whose hours of work begins before and extend beyond midnight, day means a period of twenty-four hours beginning at the hour his work commences.

Opened– “Opened” means opened for the service of any customer or for any business connected with the establishment.

Closed– “Closed” means not open for the service of any customer to any business connected with the establishment. 

Few exceptions where the provision of the Bihar Shops and Establishment Act is not applicable

The provisions of the Act do not apply to any precinct or premises of a mine defined under the Mines act,1952. The schedule of the Act specifies establishments, employees or other persons in relation to whom the specified provisions of the Act will not apply. The state government is empowered to add, omit or alter any entries in the Schedule.

Registration of Establishments and renewal under the Bihar Shops and Establishment Act

The State Government may make rules requiring the registration of establishment or any class of establishments or renewal thereof and prescribing manner and the fees payable for such registration or renewal.

Opening and Closing Hours of the Establishments

  • No establishment is to be opened earlier than 8 A.M. and closed later than 10 P.M on any day.
  • However, if a customer who is being served or is waiting to be served at closing hour in, he may be served during the quarter of an hour immediately following closing hour. The state government is empowered to alter the opening or closing hours for different establishments or for different areas or for different periods of the years. These provisions do not apply in case of an establishment in which two or more trades or business, any of which being sole trade or business are conducted.
  • No person is to carry on the sale of any goods in any place, whether a shop or not, before the opening or after the closing hours prescribed under the Act or any other enactment. These provisions do not apply to the hawking of the newspapers. Hawkers on footpath or market street can sell their goods up to 11.p.m.

Hours of Work, Rest Intervals, Spreadover, Weekly Holidays, and Others under the Bihar Shops and Establishment Act

Daily and Weekly Hours of Work of Adult Employees

  • No adult employee in any establishment is to be required or allowed to work in such establishment for more than 9 hours in a day and or more than 48 hours in a week. These hours will be exclusive of interval allowed for rest or for meals which together is not less than one hour in any day.
  • However, employees, other than children and young persons, engaged during any period of stock-taking or making of accounts or any other prescribed purpose, may be required or allowed to work for a period in excess of these hours, but the total number of hours of work including overtime is not to exceed 10 in any day and 54 in any week and the aggregate of hours of overtime is not to exceed 150 in a year.

The employee required or allowed to work overtime is to be paid overtime wages which will be twice the ordinary rate of wages. Ordinary rate of wages includes basic wage and other allowances, which the employee is entitled to, but does not include a bonus.

Interval for Rest

No employee in any establishment is to be required or allowed to work in the establishment for more than 5 hours continuously on any day unless he has had an interval for rest of at least half an hour. There is not to be more than one such interval for rest during the whole of the working period of any employee on any day.


The periods of work and intervals of rest of an employee in an establishment together in a day are not to spread over more than

  1. 8 hours in case of a child,
  2. 10 hours in case of a young person, and
  3. 12 hours in case of any other employee.

Weekly Holiday

  • Every establishment is to remain entirely closed on one day of the week, but the employer may keep the establishment open on weekly holiday if it falls on the opening day of the financial year. The employer is required to specify the weekly holiday in Hindi and, if necessary, in a language understood by majority of the employees, which is to be displayed at a conspicuous and convenient place at or near the main entrance of the establishment and is to be maintained in a clean and legible condition. The weekly holiday so specified is not to be altered more than once in three months and without the prior approval of the Inspecting Officer.
  • Subject to the direction of the state government, the Chief Inspecting officer may, in public interest, specify a day in which establishments in a particular area will remain entirely closed and the weekly holiday thus specified will be operative.
  • The provision of weekly holiday does not apply to an employee whose total period of employment in the week inclusive of the day of authorised leave is less than 6 days, or who is entitled to an additional holiday in the week. The employee is entitled to his normal wages on weekly holidays.

Other Holidays

Every employee in an establishment to be allowed:

  1. Holiday on full pay on the Independence Day, the Republic Day and Mahatma Gandhi’s Birthday each year, and
  2. Such other holidays on full pay up to 5 days in a year, in connection with such festivals as the State Government may declare from time-to-time. An employee required to work on any such holiday is to be paid remuneration at double the rate of his normal wages calculated by the hour.

Suspension of Provisions During Public Holidays

The state government may suspend the operation of all or any provisions of the Act in any area and in any establishments on account of public holidays or occasions or for any other reasons for a specified period and prescribe the conditions for the same.

Service Card

Every employee of an establishment is to be furnished by the employer a service card in the prescribed form.

Employment of Children and Young Persons under the Bihar Shops and Establishment Act

Prohibition from Employment of Children

No child below the age of 14 years is to be required or allowed to work as an employee in any establishment covered under the Act.

Furthermore, no young person or women are to be required or allowed to work, whether as an employee or otherwise, in any establishment to which this Act applies before 8 A.M. or after 10 p.m.

Daily and Weekly Hours of Work for Young Persons

No young person is to be allowed to work as an employee in any establishment to which the Act applies for more than 7 hours in any day or 42 hours in any week.

Also, no young person is to be required or allowed to work in such establishment for more than 4 hours continuously on any day unless he has an interval for rest and meals of at least 1 hour.

Provision of leave with wage under the Bihar Shops and Establishment Act.

Annual leave with wages

  • Every employee who has worked for 240 days or more in an establishment during a calendar year and who has not been involved in an illegal strike, is to be allowed, during the subsequent calendar year, leave with wages for a number of days calculated at the rate of one day for every twenty days of work performed by him during the previous calendar year.
  • For the purpose of computation of the period of 240 days or more, the days of lay-off by agreement or contract or as permissible under the standing orders, days of lock-out, maternity leave for not more than 12 weeks in case of female employees, and leave earned in the previous year are to be included in the days on which the employee has worked. The leave with wages is to be exclusive of all holidays whether occurring during, or at either end of the period of leave.
  • If the service of an employee commences otherwise then on the first day of January, he is entitled to leave with wages at the specified rate if he has worked for 2/3rd of the total number of days in the remaining period of the calendar year.
  • An employee, who has been employed for a period of not less than 120 days, is entitled to leave with wages at the specified rate if the ratio of the number of days of his employment is not less than the ratio which 240 bears to 365.

If an employee does not avail of the whole leave in any calendar year, the days of unavailed leave is to be added to the leave allowed to him in the succeeding calendar year, but the total number of days of leave that may be carried forward is not to exceed 45 days.

Application for leave has to be given at least 15 days before the employee intends to go on leave.

  • The application for leave is ordinarily not to be refused without recording sufficient cause. An employee aggrieved by the employer’s decision to refuse leave can appeal to the prescribed authority who may also award compensation if the refusal was without sufficient cause. If the leave of an employee having to his credit 45 days of leave is reused, he is entitled to wages for the period for which leave was refused and the amount thus payable will be in addition to the normal wages payable for the period. However, in such a case, the leave to his credit will be reduced by the number of days in respect of which such an amount is received.
  • If the service of an employee is terminated by the employer before he has taken the entire leave to which he is entitled or if after applying for leave he quits employment, the employer will pay him the amount which he is entitled to before the expiry of the second working day after the day on which his employment is terminated, and before the next pay day if he quits his employment. If an employee wants to avail himself of the leave with wages due to him to cover the period of illness, he is to be granted such leave even if the application is not made within the specified time and the payment is to be made within 15 days.

Other Kinds of Leave

In addition, to leave with wages earned by him, every employee of an establishment is entitled to,

  • Casual leave with full pay for 12 days in a Calendar year and
  • Sick leave on half pay for 12 days in a Calendar year on production of a medical certificate.
  • Casual leave or the sick leave is not accumulative. Care-takers, guards, and watchmen, who have been in continuous employment for a period of 12 months or more are entitled to, in addition to the leave with wages earned, casual leave and sick leave, 45 days leave with full pay for every completed 12 months of continuous service.

Wages Payable During Period of Leave

Wages payable during the period of leave will be daily average of his total full-time earnings exclusive of any overtime earnings and the annual bonus, but inclusive of attendance bonus, efficiency bonus and other incentive bonuses and dearness allowance and the cash equivalent of any advantage accruing through the sale of foodgrains and other articles at concessional rates for the days on which he worked during the month immediately preceding his leave.

On the demand of an employee proceeding on earned leave, he is to be given an advance payment of the wages for half of period of leave and the wages for the wage-period immediately preceding such leave. The wages for the remaining half period are to be paid to him along with the wages for the first wage-period after he resumes duty. The wages for the period of sick leave shall be payable to the employee along with his wages for the first wage-period after he resumes duty.

Power of State Government to Increase the Amount of Leave

The state government is empowered to increase the total amount of leave and the minimum number of days up to which such leave may be accumulated in specified establishments.

Dismissal or Discharge

No employer is empowered to dismiss or discharge or otherwise terminate the employment of any employee who has been in his employment continuously for a period of not less than six months, except for a reasonable cause and after giving such employee at least one month’s notice or one month’s wages in lieu of such notice. such notice is not necessary where the services of such employee are dispensed with on a charge of such misconduct as may be prescribed by the State Government, supported by satisfactory evidence recorded at an inquiry held for the purpose. An employee who has been in continuous employment for a year or more and whose services are dispensed with otherwise than on a charge of misconduct shall also be paid compensation equivalent to fifteen days average wages for every completed year of service and any part thereof in excess of six months before his discharge in addition to the notice or pay in lieu of notice as prescribed above.

Every employee, dismissed or discharged or whose employment is otherwise terminated, may make a complaint in writing in the prescribed manner, to a prescribed authority within 90 days of the receipt of the order of dismissal or discharge or termination of employment on the one or more of the following grounds, namely : —

  1. There was no reasonable cause for dispensing with his services; or
  2. No notice was served on him as required above; or
  3. He has not been guilty of any misconduct as held by the employer; or
  4. No compensation as prescribed above was paid to him before dispensing with his service.

Inspection and Penalties under the Bihar Shops and Establishment Act

Appointment of Inspecting Officer

The appointment of Inspecting Officers is to be made by the state government.

The State Government, by notification in the Official Gazette, appoint any person to be the Chief Inspecting Officer who shall, in addition to such powers as may be prescribed by the Chief Inspecting Officer, exercise the powers of an Inspecting Officer throughout the State.

Powers and Jurisdiction of Inspecting Officer

An Inspecting Officer may within the limits of his jurisdiction —

  1. Enter, during such hours as may be prescribed and with such assistance, if any, as may be necessary, any premises which is, or which he has reasons to believe is, an establishment;
  2. Inspect, or take extracts from any prescribed registers, records and notices maintained under this Act or the rules made thereunder or seize such records, registers or notices as he may consider relevant in respect of an offence under this Act which he has reason to believe to have been committed by an employer;
  3. Take on the spot or otherwise the statement of any person which he may consider necessary for carrying out the purposes of this act. Provided that no person shall be compelled to answer any question or give any evidence tending to incriminate himself; and
  4. Exercise such other power as may be prescribed for carrying out the purposes of this Act.

The Inspecting Officer for the purposes of any inquiry under this act have same power regarding the summoning and attendance of witnesses and compelling the production of documents as a Civil Court has under the Code of Civil Procedure, 1908 (V of 1908).

Inspecting Officers to be public servant

Every Inspecting Officer appointed under this Act is deemed to be public servant within the meaning of section 21 of the Indian Penal Code, 1860 (XLV of 1860).

Penalty for obstructing Inspecting Officer

  • Any person who voluntarily obstructs an Inspecting Officer in the exercise of any power conferred on him by or under this Act or any person lawfully assisting an Inspecting Officer in the exercise of such power or who fails without sufficient cause to comply with any lawful direction made by an Inspecting Officer is punishable with imprisonment which may extend to 6 months or with fine which may extend to Rs.250, or with both.
  • An employer, who contravenes any provisions of the Act or any rule or order made under it, if no other penalty is provided for the offense, is punishable with fine which may extend to Rs.250 for the first offence and to Rs.500 for every subsequent offence after the first conviction.
  • The person, who gives a malicious or vexatious application to the prescribed authority relating to deduction of wages or delayed payment, may be directed to pay penalty not exceeding Rs.25 to the employer or other person responsible for the payment of wages.
  • If the person contravening the provision of the Act or a rule or order made under it is a company or a partnership firm, every director, partner, manager or secretary is to be deemed to be guilty of the contravention, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention.


No court is to take cognizance of an offence punishable under the Act, rule or order except on a written complaint made by Inspecting Officer or any person authorised by the state government within 6 months of the date on which the offence is alleged to have been committed. In certain cases such as annual leave with wages, other kinds of leave, notice of dismissal or discharge and claims arising out of deductions from wages or delay in payment, the court may take cognizance of the offence even after 6 months if it is satisfied that the complainant was prevented by sufficient cause from filing the complaint within this period. No court inferior to that of a magistrate of the first class is authorised to take cognizance or try an offence punishable under the Act.


P.R.N Sinha, Indu Bala Sinha & Seema Priyadarshini Shekhar, Industrial Relations, Trade Unions and Labour Legislations (2nd ed. 2013)

The Bihar Shops and Establishments Act, 1953

Garner Bryana, Black’s law Dictionary, 7th Edn. 1981, West Group

Collin’s Gem English Thesaurus, 8th Edn.2016. Collins


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