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CS Professional · Labour Laws and Practice · The Labour Laws (Simplification of Procedure for Furnishing Returns and Maintaining Registers by Certain Establishments) Act, 1988

Ganga Plastics employed 38 persons on one day in the preceding twelve months but only 8 on every other day. It argues that it is a very small establishment and wants to maintain only Form III. How is it classified?

Ganga Plastics is a small establishment. The definition looks at whether ten to forty persons were employed on any day of the preceding twelve months, and 38 on one day meets that. It must therefore maintain Forms II and III, and an average headcount is irrelevant.

  1. AVery small, because it employed no more than nine persons on most days
  2. BSmall, because it employed between ten and forty persons on at least one day of the preceding twelve monthsCorrect
  3. CNeither, because the headcount fluctuated
  4. DVery small, because the average headcount is below ten

Explanation

Section 2(e) covers an establishment where not less than ten and not more than forty persons are employed or were employed on any day of the preceding twelve months. The 38 on one day places it in the small category, which requires Forms II and III. An average is not the test.

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