POSH compliance

POSH Compliance: Everything You Need to Know

One of the basic requirements of a workplace is a safe working environment. On the other hand, S*xual harassment has become an inevitable evil in society. It becomes pretty grave when people are harassed in the workplace. A company must provide a safe workplace to its employees. To ensure this, every country has some rules that force companies to take anti-harassment measures. Similarly, the Indian government has a POSH policy for preventing the harassment of women in workplaces. The act was enacted in 2013 by the Indian Government.

Unfortunately, many companies still ignore POSH compliance in India. Not to forget, they are promoting a hostile work environment by ignoring the POSH policy. Read on to understand the POSH policy in its entirety.

Understanding the POSH Act in detail

POSH (Prevention of Women from S*xual Harassment) Act came into existence in 2013. The Vishaka vs. State of Rajasthan (1997) case played a significant role in the existence of the POSH Act. Many other reforms in society led to the formation of the POSH Act. The government noticed that women are repeatedly being harassed in workplaces. For the same rationale, the authorities came up with the POSH Act for all the companies in the country, including foreign entities. The POSH Act required companies to take some measures to prevent the harassment of women in workplaces. It included the formation of a separate committee and change in employment contracts. POSH Act includes a list of compliance norms for companies in the country.

The Government takes this act very seriously and punishes those companies that do not meet the guidelines of this act. Such companies are subject to legal and monetary punishment. Investors might look at the POSH standards of the company before providing capital. Similarly, customers might get to know about a company that creates a hostile work environment for women. By ignoring POSH compliance, a company might lose its reputation.

What comes under POSH compliance for companies?

There is a list of requirements for companies according to the POSH Act. Every company is supposed to have a POSH policy, irrespective of size and structure. The steps required according to the POSH Policy are as follows:

  • Creating awareness

The employer must create awareness in the workplace regarding the POSH policy. It is also the duty of the employer to inform women within the organisation about the policies of this act. If they face harassment, they can take necessary action.

Employers can hold webinars, meetings, seminars, and orientations to inform employees of the company’s POSH policy. Let the employees know that the company will take harassment issues seriously. Let them know the legal consequences of harassment in the workplace. An employer can also distribute pamphlets and brochures to employees explaining the POSH policy.

  • Drafting a POSH policy

The company must have a strict POSH policy to prevent and prohibit s*xual harassment. The POSH policy should comply with the law and must be drafted by the company’s senior management. Let the employees and senior management professionals know the existing POSH policy.

  • Establishing a committee

According to the POSH Act, every company is required to set up an ICC (Internal Complaints Committee). The committee will listen to harassment complaints from women in the workplace. The committee will also make decisions regarding harassment cases within the company.

As per the POSH Act, an ICC must have a minimum of three participants. It is mandatory to have a senior company professional and a woman employee as an ICC member. An ICC is required to provide the verdict on a harassment case within ten days of the complaint. When the company’s employee count is less than ten, a Local Complaints Committee (LCC) is formed.

  • Drafting employment contracts

The company’s employment contract must reflect its POSH policy. It must include a section/clause for the agreement with the employee regarding POSH laws. One can always seek external help to design employment contracts that reflect the POSH policy.

  • Generating an annual report of POSH policy

POSH compliance includes generating an annual report. The yearly report will consist of the number of cases and their verdicts. It will also include the investigations associated with the harassment cases within a year. The ICC or the LCC is responsible for generating annual POSH reports. The report is forwarded to the district officer annually in the presence of the employer/company owner.

Why is POSH policy essential?

A monetary punishment of Rs. 50,000 is declared for companies ignoring POSH compliance. On repeated non-compliance with the POSH policy, the employer might suffer a fine of up to Rs. 1.5 lakhs. The company’s licence will be cancelled on repeated non-compliance cases. A company can seek help from a CA firm to ensure compliance with the POSH Act. Start taking the POSH Act seriously in 2022!

Read more about ifc applicability.

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