Start-Ups and POSH Compliance

Many Start-Ups and SMEs often do not take the Act seriously and are not aware of how to implement (prevention of sexual harassment) provisions at workplaces, especially when new investors scrutinize such provisions.?

The Sexual Harassment (Prevention, Prohibition and Redressal) Act, 2013 read with the Sexual Harassment (Prevention, Prohibition and Redressal) Rules, 2013 collectively referred to as, "POSH Law", grants protection against?sexual harassment of women in the workplace. This Act is remarkable as it defined ‘employee’ as all women working or visiting any workplace as a regular employee, temporary employee, coworker, contract worker, probationer, trainee, apprentice, visitor, on daily wages engaged directly or indirectly (contractor), working for a certain remuneration, voluntary or otherwise,?terms of employment may be express or implied. It is a protection guaranteed for every woman working or visiting?a workplace.

Further, it defines ‘workplace’ includes any place visited by the employee/visitor arising?out of or during the course of employment including transportation provided by the employer, covering organized and unorganized sectors, government/private organizations, hospitals/nursing homes, sports institutes/facilities and dwelling or house and also includes extended workplaces – office parties,?outbound training, conferences, and of course ‘work from home’.?The “unorganized sector” in relation to a workplace means an enterprise owned by individuals or self-employed workers and engaged in production or sales or service with less than 10 workers.

What are the obligations of the employer under the Act?

1.????To establish an Internal Complaints Committee

The employer is required to constitute an Internal?Complaints?Committee at every organization having more than 10 employees, headed by a woman as its presiding member. The majority of the members of the Internal Complaints Committee should be women, with at least one external member. An Internal Complaints Committee needs to be constituted even if there are no women employees working at present at the establishment.

2. To implement a well-drafted POSH Policy

The employer is obliged to put in place, a well-drafted anti-sexual harassment policy, containing the details of the?processes and steps?it would take to implement POSH at the workplace and to also make the employees aware of the same. It is important that the offer letter and employment contract state the organization’s commitment to ensure a safe workplace and the disciplinary cum legal actions an employee would face when they violate the POSH policy of the organization.

3. To display the Policy

The POSH Policy must be circulated among the employees. The employer is also required to display the same at conspicuous places in the workplace along with repercussions of sexual harassment. They are also required to conspicuously display the composition of the Internal Complaints Committee along with their contact details.

4. To treat sexual harassment as misconduct

Any instance of sexual harassment must be treated as misconduct. The employment agreements, service rules, policies and procedures, and standing orders must clearly state that sexual harassment will be treated as misconduct. The consequences of sexual harassment must also be clearly stated like deducting wages, termination of employment, etc.

5. Internal Committee (IC)

Internal Committee is a judicial body formulated in an organization that has?10 or more employees. The Employer must pass an order in writing to constitute an IC. For example, if the organization is a private limited company, the order in writing for the constitution of an IC should be passed as a Board Resolution. The IC is responsible to handle and redress complaints on sexual harassment. It is mandatory that one-half of the IC members are women and the presiding officer should be a woman. The IC should have 3 types of members, namely

a) Presiding Officer:?This member will be the chairperson of the Internal Committee and should be a?senior-level female employee. This is to make the IC more approachable to women complainants.

b) Employee Members:?The IC should also include two or more members from the employees, preferably individuals who have decent legal knowledge, experience in social work, or are committed to the cause of women.

c) External Member:?The IC should include an external member?who is not connected to the organization in any manner?except as an external member. The person should be familiar with issues relating to sexual harassment, lawyer or from a non-governmental organization or association committed to the cause of women.

6. To conduct seminars and training to promote awareness

It is the responsibility of all employers to educate and sensitize their staff about the subject of sexual harassment. Employers must hold training and seminars to promote awareness about workplace sexual harassment among their employees.

7. To submit the Annual Report

The Internal Complaints Committee is required to submit annual reports to the appropriate authority and the employer under the provisions of this Act. The annual report for the calendar year is to be filed by January 31 every year, for the previous?year, to the respective district welfare officer, specifying the number of complaints received, disposed of, and pending for more than?90 days?during the year. They should also mention the nature of workshops or awareness programs conducted against sexual harassment, and the nature of action taken by the employer or district officer.

Even if a company only has male employees and no women on its payroll, it still needs to constitute an Internal Committee. Merely having a grievance redressal system in place, would not automatically take care of sexual harassment issues. Further, for organizations with less than 10 people, there is a Local Complaints Committee administered by the District Welfare Office to handle the complaints. If an employer fails to comply to any provisions of the POSH Act, they will be fined up to 50,000 rupees. If the employer violates the POSH Act for the second time, they may be penalized twice as much as the first time, or their license, permit, or registration to conduct business or activity may be revoked.

The POSH Act was further strengthened by linking it to the Company’s (Accounts) Rules 2014 where the?employer with 10 or more employees with the exemption of one person company and small company, is bound by law to disclose and include details of the Internal?Committee composition in the Board of Directors report submitted to the Registrar of Companies. However, similar statutory checks need to be specifically established for entities that run as sole proprietorships/ partnership firms/societies/trusts, etc.

Further, the POSH Act needs to make it equitable for all persons, protecting only women and excluding men and the LGBTQIA+ community is clearly unfair.?Companies should decide to develop a gender-neutral policy that will safeguard all female, male, and transgender employees from workplace sexual harassment. It is important for companies to include a statement in their policy stating that they will not tolerate sexual harassment of employees of any gender identity, empowering each employee to report instances of sexual harassment in accordance with the policies.