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The Sexual Harassment Act and the Indian Workplace

By Melissa Cyrill，Dezan Shira & Associates
Posted: 5th November 2015 11:49
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act is a legal act of the Indian parliament that came into effect on December 9, 2013. The Act was passed after numerous political delays and controversies, and is based on the landmark guidelines established by the Supreme Court in the case of Vishaka versus State of Rajasthan, 1997.
 
The 2013 Act seeks to specifically protect women from sexual harassment at their workplace, and provides a redressal mechanism to handle complaints. It also provides safeguards against false or malicious charges. The Act contains a number of provisions for employers in India. Employers in India should carefully review the main provisions of the Act, and adopt human resource policies accordingly.
 
Where Does It Apply?
 
The ‘workplace’ has been broadly defined by the Act to include the premises of all government and private entities which operate on a commercial basis (that is, they are involved in any economic activity) or work in education, entertainment, vocational services, sports facilities (such as stadiums, sports institutes and sports complexes), health services (such as hospitals and nursing homes), and any place visited by the employee arising out of or during the course of employment, including while in transit for work related activities.
 
Societies, trusts and non-governmental organizations, where people work on a voluntary basis, are also included. Moreover, with respect to domestic workers, even a house is considered as a workplace.
 
What Constitutes Sexual Harassment?
 
The Act broadly defines ‘sexual harassment’ as follows:
 
  • Implied or explicit threat of harmful treatment in employment;
  • Implied or explicit threat about present or future employment status;
  • Interference with work or creating an intimidating or offensive or hostile work environment;
  • Humiliating treatment likely to affect health or safety.
What are the Major Provisions?
 
Employers need to take note of the following key responsibilities under the Act:
  • Display penal consequences of sexual harassment;
  • Organize workshops and sensitization programs;
  • Formulate an internal policy/charter/resolution/declaration;
  • Form an ‘Internal Complaints Committee’ (ICC) where the number of employees is more than ten;
  • Provide necessary facilities to the Committees;
  • Secure attendance of witnesses/respondent;
  • Monitor timely submission of Committee reports;
  • Assist the woman in pursuing a criminal case if she so chooses;
  • Maintain confidentiality of the inquiry process, and the Act lays down a penalty of Rupees 5,000 on the person who has breached confidentiality; and,
  • With sexual harassment being a crime, employers are obligated to report offences.
 
What are the Penalties for Non-Compliance?
 
Chapter VI of the Act defines the duties for employers. Section 26 prescribes penalties for non-compliance with the provisions of the Act, which includes a monetary fine of up to Rs. 50,000 (approximately US $772), amongst other penalties. If an employer repeats the same offence, authorities can double the financial penalty and/or cancel the registration of the entity or revoke any statutory business licenses.
 
Once a sexual harassment case is reported, employers have to gather evidence and take action within three months. If the complainant is not satisfied, the complainant can approach the court or police to revisit the complaint.
 
Observations
 
The biggest challenge to implementation has been ignorance of the law. The government has received numerous complaints from across the country that companies have failed to observe key provisions of the Act. This is why, in order to ensure compliance, the Ministry of Women and Child Development has asked the Ministry of Corporate Affairs (MCA) to notify rules under section 134 of the Companies Act, 2013, which would then require companies to disclose the composition of ICC committees in their Director’s Report.
 
Meanwhile, the Act also places responsibility on the appropriate state government to notify the district officer for setting up a Local Complaints Committee (LCC). State governments are expected to monitor the implementation of the Act; the LCC is required to investigate complaints received from employees in cases where an ICC has not been constituted by the employer or the complaint is against the employer. It has been nearly two years since the Act came into force, but only one state – Rajasthan – has managed to become fully compliant with the law.
 
The Act is, however, not without limitations – it focuses only on women employees, does not cover women in the armed forces and excludes women agricultural workers (the single largest female component of workforce in India). Nonetheless, criticisms notwithstanding, the focus of the Act is to prevent sexual harassment by bringing about a behavioral change among employees. It is therefore an important mechanism through which a healthy and safe workspace may be constituted, for all employees concerned.

Since its establishment in 1992, Dezan Shira & Associates has been guiding foreign clients through Asia’s complex regulatory environment and assisting them with all aspects of legal, accounting, tax, internal control, HR, payroll and audit matters. As a full-service consultancy with operational offices across China, Hong Kong, India and emerging ASEAN, we are your reliable partner for business expansion in this region and beyond.

For inquiries, please email us at info@dezshira.com. Further information about our firm can be found at: www.dezshira.com.

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