Punjab eases its shops and establishments rules: Key amendments for 2025

At a glance

• The Punjab government has notified the Punjab Shops and Commercial Establishments (Amendment) Act, 2025 (Amendment Act) on 29 August 2025, introducing significant amendments to the Punjab Shops and Commercial Establishments Act (Punjab S&E Act).
• Small businesses employing less than 20 workers face lighter compliance requirements.
• Daily working hours and overtime limits have been increased for all establishments.
• Penalties for breaches have been updated, with some offences now eligible for compounding.

We would like to express gratitude to JSA for their contribution on this publication.

By introducing the Amendment Act, the Punjab government aims to simplify statutory compliances and offer greater flexibility to businesses. Under the Amendment Act, the provisions under the Punjab S&E Act no longer apply to shops or establishments having employed less than 20 workers, and they are only required to comply with the provision regarding intimation of business under Section 13-A of the Punjab S&E Act (which has been introduced by the Amendment Act). Employers of such establishments are mandated to notify the designated authority under the Punjab S&E Act (Inspector) of their businesses in the prescribed manner within six months from the date of commencement of their businesses. However, all provisions under the Punjab S&E Act become applicable to these establishments whenever their employee headcount increases to 20 or more. For establishments who have employed 20 or more workers, the registration process has been relaxed, allowing employers a period of six months from the date of commencement of their businesses (as opposed to the earlier timeline of 30 days) to register their businesses with the Inspector, and offers them automatic registration if the registration certificate is not issued by the Inspector within 24 hours from receipt of the application for such registration.

Working hours have also been revised by the Amendment Act, with the daily maximum limit of hours extended to ten hours (previously, nine hours) and quarterly overtime limits increased to 144 hours (previously, 50 hours). The permissible spread of working hours in a day has also been raised to 12 hours (previously, ten hours). Penalties for non-compliance with the provisions of the Punjab S&E Act have been updated, with higher fines for repeat offences and compounding of offences has been introduced for certain breaches by the Amendment Act, potentially reducing administrative burdens. These changes reflect the government’s intent to foster a more business-friendly environment in Punjab.