Drafting and Implementing an Effective POSH Policy: Legal Requirements, Best Practices, and Risks of Non-Compliance

The Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013 ("POSH Act") was enacted to ensure a safe and dignified working environment for women. This legislation mandates that every organization with more than 10 employees must formulate a comprehensive POSH Policy and establish an Internal Committee (IC) to address complaints of sexual harassment. Failure to comply with the Act or mishandling complaints can not only damage the organization’s reputation but also lead to costly litigation and judicial intervention.

This article outlines the key legal aspects of drafting a POSH Policy, the correct process for handling complaints, the legal risks of improper implementation, and case laws that highlight these issues.

II. Drafting a Legally Sound POSH Policy

1. Scope and Applicability:

• The policy must clearly state that it applies to all employees, interns, consultants, and visitors, regardless of position or tenure.
• It should cover both physical office premises and virtual/remote work environments.

2. Definition of Sexual Harassment:

• The policy must align with Section 2(n) of the POSH Act and include examples of physical, verbal, non-verbal, and cyber harassment.

3. Roles and Responsibilities:

• Clear definition of the role of the employer, management, the Internal Committee, and employees in preventing and addressing harassment.

4. Constitution of Internal Committee:

• The policy should specify the composition, qualifications, and tenure of IC members as per Section 4 of the Act.
• Emphasis on gender diversity and independence in the committee.

5. Complaint Mechanism:

• A step-by-step guide on how an aggrieved woman can file a complaint.
• Clarify the need for a written complaint under Section 9.

6. Conciliation Process:

• Include provisions for voluntary conciliation under Section 10 before formal inquiry, ensuring that no monetary settlement is made.

7. Inquiry Procedure:

• Set out timelines, confidentiality, fair hearing principles, cross-examination, and rights of both parties.

8. Protection Against Retaliation:

• The policy must assure protection from victimization, intimidation, or retaliation against any party.

9. False or Malicious Complaints:

• A balanced provision warning against false complaints, without discouraging genuine grievances.

10. Training and Awareness:

• Mandate periodic POSH awareness and training for all employees and IC members.

III. Implementing the POSH Process Correctly

1. Awareness:

• Conduct regular training sessions and display the POSH Policy prominently.

2. Access to Internal Committee:

• Ensure employees know how to reach the IC confidentially and without fear.

3. Time-bound Inquiry:

• Complete inquiries within the statutory 90-day period.

4. Documentation

• Maintain detailed, confidential records of complaints, proceedings, and decisions.

5. Follow-up Action:

• Implement IC recommendations swiftly and fairly.

IV. Legal Risks of Non-Compliance and Mishandling POSH Cases

1. Violation of Fundamental Rights:

• Mishandling or ignoring complaints can lead to Article 21 (Right to Life and Dignity) violations.

2. Breach of Natural Justice:

• Denial of fair hearing, bias, or failure to follow due process exposes organizations to judicial review.

3. Reputational and Financial Damage:

• Media scrutiny, employee distrust, and potential compensatory damages can follow.

4. Penalties Under the Act:

• As per Section 26, non-compliance can lead to fines and even cancellation of business licenses.

V. Key Judicial Precedents

1. Dr. Kali Charan Sabat v. Union of India & Ors. (2024, MP High Court):

• Held that conciliation under Section 10 must be mandatorily offered before formal inquiry if the complainant is open to it. Failure to do so can render the proceedings invalid.

2. Abraham Mathai v. State of Kerala & Ors. (Kerala HC):

• Reaffirmed that a written complaint is mandatory for initiating an inquiry. Oral or anonymous complaints cannot be the sole basis for action unless there are exceptional circumstances.

3. Malabika Bhattacharjee v. Internal Complaints Committee, Vivekananda College (Supreme Court):

• Stressed that confidentiality is paramount, and any breach can lead to legal action and reputational damage.

VI. Conclusion and Recommendations

Drafting and implementing a legally compliant POSH Policy is not merely a statutory obligation but a cornerstone of workplace dignity and organizational culture. Employers must:

• Draft detailed, legally accurate policies.

• Constitute and train an impartial Internal Committee.

• Follow fair, transparent processes, strictly adhering to legal timelines.

• Maintain confidentiality and prevent retaliation.

Failure to do so can result in judicial intervention, fines, reputational loss, and erosion of employee trust. Organizations must view POSH compliance as both a legal and ethical imperative, essential for a safe, respectful, and productive workplace.

Understanding Leave Laws for Employees in India: A Complete Guide.

In India, every working professional is entitled to certain types of leaves for rest, health, family, or other personal reasons. Leave laws in India are governed by both central and state-specific labor laws, which aim to strike a balance between employee welfare and employer requirements. Knowing your leave rights helps you stay compliant and ensures fair treatment at the workplace.

In this blog, we’ll explore the types of leaves, applicable laws, and key employee rights under Indian labor law.

Types of Leaves Under Indian Labor Laws

Earned Leave (EL) or Privilege Leave (PL):

• Eligibility: Typically available after completing a certain number of days of employment (e.g., 240 days in a year).
• Accrual: Usually 1.25 to 2 days per month, depending on state rules and company policies.
• Carry Forward: Unused ELs can often be carried forward to the next year.
• Encashment: Many companies allow encashment of unused ELs during employment or at resignation/retirement.

Casual Leave (CL):

• Purpose: For sudden, unforeseen circumstances like family emergencies, short travel, or minor illness.
• Allotment: Typically 7 to 10 days per year.
• Accrual: Usually granted monthly or quarterly.
• Carry Forward: Generally not allowed; unused CLs lapse at year-end.

Sick Leave (SL):

• Purpose: For health-related issues.
• Allotment: Usually 6 to 12 days per year, depending on state laws.
• Requirement: Employers may ask for a medical certificate for absences over 2-3 days.
• Carry Forward: Allowed in some states, with a cap.

Maternity Leave:

• Act: Governed by the Maternity Benefit Act, 1961.
• Duration: 26 weeks for the first two children, 12 weeks for the third and beyond.
• Eligibility: Female employees must have worked for at least 80 days in the 12 months prior to delivery.
• Additional Provisions: Includes benefits like nursing breaks and work-from-home options (where applicable).

Paternity Leave:

• Law: Not mandatory under Indian labor law, but some companies offer 7–15 days as part of their HR policies.
• Trend: Growing awareness is leading many organizations to include paternity leave in their benefits package.

Bereavement Leave:

• Purpose: Leave granted in the event of a death in the immediate family.
• Law: Not mandated, but offered by many employers as a gesture of compassion.

Leave Without Pay (LWP):

• When Applied: When all paid leaves are exhausted.
• Impact: May affect salary, bonus, and benefits depending on the company’s leave policy.

Key Leave Laws and Regulations in India

• Factories Act, 1948 – Governs leave entitlements for factory workers.
• Shops and Establishments Act (State-wise) – Regulates leave policies for employees in shops, offices, and commercial establishments.
• Maternity Benefit Act, 1961 – Covers maternity leave and related benefits.
• Industrial Employment (Standing Orders) Act, 1946 – Requires employers to define and publish leave rules.

State-Specific Variations

Leave rules under the Shops and Establishments Act vary from state to state. For example:

• In Maharashtra, a minimum of 21 days of earned leave annually.
• In Delhi: 15 days of earned leave with carry-forward up to 45 days.
• In Karnataka, 18 days of earned leave and 12 days of sick leave.

Employers must comply with the respective state laws in addition to central regulations.

Employer’s Role in Leave Management

Employers are required to:

• Maintain a leave register.
• Ensure fair and consistent leave policy implementation.
• Notify employees about their leave entitlements.
• Avoid penalizing employees for availing of legitimate leaves.

Many companies also use HR software to manage leave balances, automate approvals, and ensure legal compliance.

Conclusion

Understanding leave laws in India is essential for both employees and employers. While the law provides a framework, company-specific policies may offer additional benefits. As a working professional, being aware of your rights ensures you can plan time off without fear or uncertainty. As an employer, following proper leave law practices builds a healthier and more engaged workforce.

Navigating Transgender Rights: A Guide to Employer Compliance with India's Transgender Persons (Protection of Rights) Act

The landscape of workplace inclusion is evolving, and India has taken significant steps towards recognizing and protecting the rights of transgender individuals. Enacted in 2019, the Transgender Persons (Protection of Rights) Act aims to empower and safeguard the transgender community against discrimination. This article explores the key provisions of the Act and outlines the measures employers can take to ensure compliance and foster a more inclusive workplace.

Understanding the Transgender Persons (Protection of Rights) Act:

The Transgender Persons (Protection of Rights) Act, 2019, was introduced to address the discrimination and marginalization faced by transgender individuals. Key provisions include the right to self-perceived gender identity, protection against discrimination, and access to education, healthcare, and employment without prejudice. Employers play a pivotal role in translating these legal rights into meaningful workplace practices.

Employer Compliance Measures:

Non-Discrimination Policies:

Employers should establish and communicate comprehensive non-discrimination policies explicitly stating that discrimination based on gender identity or expression, including against transgender individuals, will not be tolerated. These policies should be integrated into the organization's code of conduct and HR guidelines.

Sensitivity Training and Awareness Programs:

Conducting regular sensitivity training for employees at all levels is crucial. Awareness programs can help dispel myths, reduce biases, and create a more inclusive work culture. This should include educating employees about the rights and challenges faced by transgender individuals and promoting respectful language and behavior.

Gender-Neutral Facilities:

Providing gender-neutral facilities, such as restrooms and changing rooms, helps create an inclusive environment for transgender employees. This step contributes to fostering a workplace where all individuals feel comfortable and respected, irrespective of their gender identity.

Recruitment and Hiring Practices:

Review and modify recruitment and hiring practices to ensure they are inclusive and do not discriminate based on gender identity. Encourage diverse candidates to apply and ensure that transgender individuals are not unfairly treated during the hiring process.

Medical Insurance and Healthcare:

Review health insurance policies to ensure they cover medical needs related to gender transition. Offering inclusive healthcare benefits demonstrates a commitment to the well-being of transgender employees.

Accommodating Dress Codes:

Revise dress codes to be gender-neutral and accommodating of diverse gender expressions. This ensures that employees, including transgender individuals, can express their gender identity through their attire without fear of reprisal.

Inclusive Employee Resource Groups (ERGs):

Establishing or supporting transgender-inclusive ERGs can provide a platform for employees to connect, share experiences, and offer insights to promote a more inclusive workplace culture.

Prompt Handling of Complaints:

Implementing a transparent and accessible grievance redressal mechanism is crucial. Employees should feel confident that complaints related to discrimination or harassment based on gender identity will be promptly and fairly addressed.

Privacy and Confidentiality:

Ensure the privacy and confidentiality of transgender employees. Disclosing an employee's transgender status without their consent is a violation of their rights and can contribute to a hostile work environment.

Periodic Audits and Compliance Checks:

Regularly assess and audit policies and practices to ensure ongoing compliance with the Transgender Persons (Protection of Rights) Act. Address any shortcomings promptly and adjust strategies based on changing legal requirements.

Conclusion:

Employer compliance with the Transgender Persons (Protection of Rights) Act is not just a legal obligation but an ethical imperative. By fostering a workplace culture that values diversity and inclusion, employers can contribute to a more equitable society where the rights of transgender individuals are respected and protected. As we collectively navigate this transformative journey towards inclusion, embracing the principles of the Act is not just good business practice but a commitment to fostering a workplace where everyone can thrive.

Shop and Establishment Act and employment Law

The Shop and Establishment Act governs the state's active shops and commercial establishments. The Shop and Establishment Act (the "Act") is unique to each state. The Act's general requirements, however, apply to all 50 states equally. The Shop and Establishment Act is put into effect by the labor departments of the individual states.

According to the Act, a shop is commonly defined as a place where items are sold, either retail or wholesale, or where consumers get services. As part of the trade or business, it also comprises offices, go-downs, storerooms, and warehouses.

Generally speaking, a commercial establishment is any business, financial institution, trading company, insurance agency, or office-based service. Hotels, boarding houses, restaurants, cafes, theatres, and other public entertainment and amusement facilities are included. However, the Factories Act of 1948 and the Industries (Development and Regulation) Act of 1951 regulate factories and industries, which are not covered by the Act.

The shops and businesses covered by the Act are obligated to submit an application for registration under the applicable state Act. A Shop and Establishment Registration Certificate or Shop Licence ("Certificate") is required by the Act for all businesses and establishments, including those run entirely from home.

The Act, among other things, regulates the following matters-

• Hours of work, annual leave, weekly holidays.
• Payment of wages and compensation.
• Prohibition of employment of children.
• Prohibition of employing women and young persons on the night shift.
• Enforcement and Inspection.
• Interval for rest.
• Opening and closing hours.
• Record keeping by the employers.
• Dismissal provisions.

Posh Law in India

POSH Act Support

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is a legislative act in India that seeks to protect women from sexual harassment at their place of work. It was passed by the Lok Sabha (the lower house of the Indian Parliament) on 3 September 2012. It was passed by the Rajya Sabha (the upper house of the Indian Parliament) on 26 February 2013. The Bill got the assent of the President on 23 April 2013. The Act came into force on 9 December 2013.  Kanchan Khatana & Associates has a dedicated sub-vertical POSH ADVO   that helps you become compliant with the various mandates under the prevailing law, whereby we provide policy, training, and inquiry support in case of a sexual harassment complaint.

This includes :

• Acting as an External Member on the Internal Committee (IC) and supporting in driving the investigation and documentation of cases
• Consultation and Advisory
• Organise Mandatory Trainings:
• File Annual Returns for the Company

Must have clauses in a Data Processing Agreement (DPA)

Data is the new money in this era of globalization, it is frequently remarked. As a result, there are thousands of businesses that deal with and interchange enormous amounts of data nowadays, making it crucial to have proper security measures to safeguard such data at multiple levels. One such crucial step that addresses issues like data security, data breach, and data abuse is the data processing agreement. A DPA is already required in some regions of the world, such as the European Union (EU), for data controllers and data processors. This demonstrates how crucial DPAs are. In this essay, we'll talk about the key provisions that every DPA should have.

An official contract between the data controller and the data processor is known as the data processing addendum. It may also be a contract between a controller and a controller, a controller and a joint controller, or a data processor and a subprocessor. The DPA outlines specific guidelines regarding the identity of data subjects, the types of information processed, the categories of data processed, who collects client personal data, how it is handled, where it is stored, for how long it is stored, how it can be retrieved, deleted, processed, and protected, and what steps should be taken by the parties to prevent data breaches.

The following are key clauses 

• To prevent any difficulties in interpretation, DPA should include definitions of some key terms, according to one fundamental clause. The parties should agree to include key definitions for the following terms: Applicable Laws, Client, Client Personal Data, Contractor, GDPR, Restricted Transfer, Services, Subprocessor, Controller, Data Subject, Member state, Personal Data, Personal Data Breach, Processing, Processor, Rights of Data Subjects, Supervisory Authority.

• Roles and responsibilities of a controller should be defined

• Applicable legislation, such as the GDPR, should govern processing.

• Unauthorized use, access to the client's personal data, loss of data, or unauthorized disclosure or alteration of such data on the systems managed by the processor.

• Who is included in the scope of the DPA is specified in this clause. The data subjects may include people who are EU citizens whose personal information was acquired.

• Each party will make an effort to uphold their respective responsibilities under any relevant Data Protection standards.

• This provision must include both the DPA's start date and its end date. Any day after May 25, 2018, is acceptable.

• Processing is any action taken on a person's personal data. It must be made apparent exactly what processing tasks the processor is carrying out. That is, whether the processing entails the gathering, recording, organization, structuring, storage, adaptation, retrieval, big data analysis, consultation, disclosure, and availability of certain data, as well as the alignment, combination, matching, restriction of use or access, individual profiling, erasure or destruction, handling of media, use of data, etc.

Dealing with Employee Grievances per Indian Law

Gripes at work are unavoidable. In fact, it's been stated that having a complaint gives one's life meaning. Unresolved complaints are similar to loose cannon balls in a ship; if not handled properly, they can sink the vessel.

In India, the employer is required to implement particular grievance redressal systems at the workplace under several central and state-specific labour regulations. Here is a brief overview of numerous legal processes that HR managers should be aware of and can include in their HR policies and practises:

According to section 9C of the Industrial Disputes Act, 1947 of India (IDA), each employer who employs at least 20 workers must establish a Grievance Redressal Committee (GRC) to settle disputes resulting from worker grievances. The GRC should have a maximum of six members, with equal representation from both the managerial class and the working class.

In order to handle disputes arising out of individual worker grievances relating to non-employment, terms of employment, or conditions of service, the industrial establishment shall have one or more GRCs, according to the draught Industrial Relations Code, 2019 that has been tabled in Lok Sabha. It also suggests expanding the GRC to include ten members in total.

According to Section 3 of the IDA, the labour authorities may direct the creation of a Works Committee (WC) in a workplace with at least 100 employees. The WC must advocate for actions that ensure and uphold amity and goodwill between the employer and its employees, and to that degree, it must offer commentary on issues of shared interest or concern. Additionally, it ought to make an effort to resolve any significant disagreements within the business.

The Sexual Harassment of Women at Company (Prevention, Prohibition and Redressal) Act, 2013 of India (POSH Act) mandates the creation of an internal complaints committee (IC) at every company with at least 10 employees. The IC must look into allegations of workplace sexual harassment of women and make suggestions to the employer. According to the Code of Civil Procedure from 1908, the IC is granted the same authority as a civil court and has a three-year term limit. The statute gives the IC 90 days to finish its investigation and an additional 10 days to publish its report.