Introduction – Employment & Labour Law Penalties in India
Wading through India’s many labor and employment laws can be extremely complicated for businesses. It does not matter if you are a startup, SME or a large corporation, statutory compliance such as the Minimum Wages Act, the Payment of Bonus Act, Provident Fund Act, Sexually Harassment of Women at Workplace Act (such as) has to be maintained to save you from legal penalty/reputation risk. Failure to comply could result in fines, imprisonment, or the cancellation of business licenses.
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Employment & Labour Law Penalties in India Table Data
PENALTY TABLE A detailed penalty table assists organizations to recognize the legal implications of violation of employment and labor laws. This guide outlines some of the key penalties under Indian labor laws, including offences related to minimum wages, gratuity, equal remuneration, maternity benefits, and workplace safety.
Penalty Table: Employment & Labour Law Penalties in India
| S.no | Legislation | Offence and Penalty |
| 1. | The Minimum Wages Act, 1948 and the Manipur Minimum Wages Rules, 1961 | Failure to pay minimum wages to employees. Penalty: Imprisonment for a term which may extend to 6 (six) months or with a fine which may extend to Rs.500 (five hundred rupees) or both. |
| 2. | The Payment of Bonus Act, 1965 and the Payment of Bonus Rules, 1965. | Violation of any applicable action point of the Act as mentioned in this Memo. Penalty: Dauntless Discovery, as a company along with the concerned employer (which may be any director, manager, secretary or any delegated officer)may face imprisonment for a term which may extend to 6 (six) months, or a fine which may extend to Rs.1000 (one thousand rupees), or both. |
| 3. | The Manipur Shops and Establishments (Regulations of Employment and Conditions of Services) Act, 2021 | Violation of any action point listed in this Memo with respect to this law. Penalty: Dauntless Discovery may face a fine up to Rs. 2,00,000 (two lakh rupees), and in the case of a continuing contravention, it may be charged with an additional fine of Rs. 2000 (two thousand rupees) for every day during which such contravention continues: Provided that the total amount of the fine shall not exceed Rs. 2000 (two thousand rupees) per person employed. Subsequent conviction: Dauntless Discovery, on a subsequent conviction, may face a fine of Rs. 1,00,000 (one lakh rupees) to Rs. 5,00,000 (five lakh rupees). Contravention of the provisions of this Act, as listed in this Memo, which might result in an accident causing serious bodily injury or death of a Dauntless Discovery employee. Penalty: Dauntless Discovery may face imprisonment for up to 6 (six) months or be fined Rs. 2,00,000 (two lakh rupees) to Rs. 5,00,000 (five lakh rupees) or with both. Obstructing a facilitator in the exercise of his/her power. Refusing or neglecting to provide the facilitator with any reasonable facilities for conducting inspections, examinations, inquiries or investigations related to Dauntless Discovery’s operations.Preventing any person from appearing before, or being examined by, a facilitator. Penalty: Dauntless Discovery may be fined Rs. 2,00,000 (two lakh rupees), where the total amount of the fine shall not exceed Rs. 2000 (two thousand rupees) per worker employed. |
| 4. | The Equal Remuneration Act, 1976 and the Equal Remuneration Rules, 1976 | Recruiting and treating employees in a manner that is in contravention of this Act. Penalty: The concerned employer at Dauntless Discovery may be punishable with a fine of Rs. 10,000 (ten thousand rupees) to Rs. 20,000 (twenty thousand rupees), or with imprisonment for 3 (three) months to 1 (one) year or with both. Subsequent offence: Imprisonment may extend to 2 (two) years if the non-compliance persists. Omission or failure to maintain or produce any register or other document relating to the employment of workers. Omitting or refusing to provide any information or evidence, or preventing any agent, servant, person in charge of the establishment, or any worker from giving evidence to the inspector. Penalty: Dauntless Discovery may face imprisonment for a term up to one month, a fine up to Rs. 10,000 (ten thousand rupees), or both. |
| 5. | The Rights of Persons with Disability Act, 2016 and the Rights of Persons with Disabilities Rules, 2017 | Violation of any action point listed in this Memo concerning this law. Penalty: Dauntless Discovery may face a fine up to Rs. 2,00,000 (two lakh rupees), and in the case of a continuing contravention, it may be charged with an additional fine of Rs. 2000 (two thousand rupees) for every day during which such contravention continues: Provided that the total amount of the fine shall not exceed Rs. 2000 (two thousand rupees) per person employed. Subsequent conviction: Dauntless Discovery, on a subsequent conviction, may face a fine of Rs. 1,00,000 (one lakh rupees) to Rs. 5,00,000 (five lakh rupees). Contravention of the provisions of this Act, as listed in this Memo, which might result in an accident causing serious bodily injury or death of a Dauntless Discovery employee. Penalty: Dauntless Discovery may face imprisonment for up to 6 (six) months or be fined Rs. 2,00,000 (two lakh rupees) to Rs. 5,00,000 (five lakh rupees) or with both. Obstructing a facilitator in the exercise of his/her power. Refusing or neglecting to provide the facilitator with any reasonable facilities for conducting inspections, examinations, inquiries or investigations related to Dauntless Discovery’s operations.Preventing any person from appearing before, or being examined by, a facilitator. Penalty: Dauntless Discovery may be fined Rs. 2,00,000 (two lakh rupees), where the total amount of the fine shall not exceed Rs. 2000 (two thousand rupees) per worker employed. |
| 6. | Violating any applicable action point of the Act as mentioned in this Memo. Penalty: For the first case of non-compliance, Dauntless Discovery may face a fine of up to Rs.10,000 (ten thousand rupees). For the subsequent contravention, Dauntless Discovery may be fined Rs. 50,000 (fifty thousand rupees) to Rs. 5,00,000 (five lakh rupees). Fraudulently availing or attempting to avail any benefit meant for a PWD. Penalty: Dauntless Discovery may face imprisonment for a term up to 2 (two) years, or a fine up to Rs.1,00,000 (one lakh rupees) or both. Intentionally insulting or intimidating a PWD with the intent to humiliate him/ her in any place within public view. Assaulting or using force against a PWD with intent to dishonour him/her or outraging the modesty of a woman with a disability. Voluntarily injuring, damaging or interfering with the use of any limb or sense or any supporting device of a PWD. Penalty: Dauntless Discovery may face imprisonment for a term which shall not be less than 6 (six) months to 5 (five) years and with a fine. Not displaying required books or financial records, or failing to provide necessary statements or information as mandated by the law. Penalty: Dauntless Discovery may face a fine up to Rs.25,000 (twenty-five thousand rupees) in respect of each offence. Continued offence: In case this continues, Dauntless Discovery’s fine may extend to Rs 1000 (one thousand rupees) for each day of such continued failure. | The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Rules, 2013. |
| 7. | The Maternity Benefit Act, 1961 | Contravention of the compliances mentioned in this Memo by Dauntless Discovery. Penalty: The concerned employer at Dauntless Discovery may face imprisonment for up to 3 (three) months or a fine of Rs. 500 (five hundred rupees), or both. Specifically, for a failure to pay maternity on Dauntless Discovery’s behalf. Penalty: A competent court may recover the said maternity amount or any amount not rendered from Dauntless Discovery. Specifically, for a failure to produce on demand by the inspector any register or document in Dauntless Discovery’s custody. Specifically, concealment by Dauntless Discovery, or prevention from appearing before or being examined by an inspector. Penalty: The concerned employer at Dauntless Discovery may face imprisonment up to 3 (three) months, or be fined Rs. 500 (five hundred rupees), or both. |
| 8. | The Payment of Gratuity Act, 1972 and the Payment of Gratuity (Central) Rules, 1972 | Where the Dauntless Discovery fails to – constitute the Internal Committee; ortake action against the woman or the person who has made the false complaint; ortake action for sexual harassment against the respondent by the provision of the service rules where the allegation against the respondent has been proven; orinclude the information in the annual report as required by the Act; andcontravenes or attempts to contravene or abets contravention of other provisions of this Act or any rules made thereunder. Penalty: Dauntless Discovery may face a fine of up to Rs. 50,000( fifty thousand rupees). Subsequent Conviction: If Dauntless Discovery is convicted again for the same offence under this Act, the penalty doubles compared to the initial conviction. Additionally, the government or local authority may cancel its licence, approval, or registration necessary for their business or activity. |
| 9. | The Employees’ Provident Funds And Miscellaneous Provisions Act, 1952 | Intentionally making a false statement or false representation to avoid any payment. Penalty: The director of Dauntless Discovery may face imprisonment for a term up to 1 (one) year, or a fine up to Rs. 5000 (five thousand), or both. Non-compliance with payment of applicable contributions. Penalty: The director of Dauntless Discovery may face imprisonment for a term of 3 (three) years, and fined Rs.10,000 (ten thousand). Non-compliance with payment of inspection charges. Penalty: The director of Dauntless Discovery may face imprisonment for up to 1 (one) year, and fined Rs. 5000 (five thousand). Non-deduction of wages as an employee contribution. Non-payment of an administrative charge of such wage percentage within the first 15 (fifteen) days of the month. Penalty: The director of Dauntless Discovery may face imprisonment of up to 6 (six) months and fined Rs.5000 (five thousand rupees). For every of the above-mentioned subsequent offences. Penalty: The director of Dauntless Discovery may be imprisoned for 5 (five) years and fined Rs. 25,000 (twenty-five thousand rupees). |
We at Corrida Legal ensure 100% compliance for businesses with Indian employment laws. Our team of legal experts and compliance specialists work to ensure your company meets all the labor law requirements, avoids penalties and implements best practices for workforce management. To protect your business, we offer compliance auditing, HR policy structuring, workplace legal training, and regulatory filings.
Continue reading to learn how labor law violations in India are penalized and how without Corrida Legal, you will not prevent your business from such legal issues.
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