Employment Exchanges Act, 1959: What HR Needs to Know
Table of Contents
The Employment Exchanges Act, 1959 required covered employers to report certain vacancies and submit employment information to government employment exchanges. It was repealed on 21 November 2025. While the statutory requirement to report vacancies remains, the underlying framework and compliance process have shifted. Today, the Code on Social Security, 2020 and the Social Security (Central) Rules, 2026 govern vacancy reporting. This guide explains what the old Act covered, what applies to you now, how penalties have changed, and what to do before your next hire.
Key Takeaways
- The Code on Social Security, 2020 repealed the Employment Exchanges Act, 1959 on 21 November 2025.
- The Social Security (Central) Rules, 2026 replaced the 1960 Rules and now set the reporting process.
- Career centers now handle vacancy reporting under the new framework.
- The Code excludes non-government establishments with fewer than 20 employees. The old Act set this limit at 25.
- Form-XXV is used for vacancy reporting, while Form-XXVI is the yearly Employment Information Return.
- If the reporting duty applies to you, non-compliance can attract a fine of up to ₹50,000 under the Code.
What is the Employment Exchanges Act, 1959?
The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959, also known as Act 31 of 1959, governed the reporting of vacancies to employment exchanges. It applied across India. The Act applied to all public-sector establishments and to private-sector establishments only after a Gazette notification was issued.
The table below sets out the key legal details.
| Parameters | Details |
|---|---|
| Full title | The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 |
| Act number | Act No. 31 of 1959 |
| Assent | 2 September 1959 |
| Commencement | 1 May 1960 |
| Sections | 10 |
| Rules | Employment Exchanges (Compulsory Notification of Vacancies) Rules, 1960 |
| Authority | Directorate General of Employment (DGE), Ministry of Labour and Employment |
| Status in 2026 | Repealed and subsumed under the Code on Social Security, 2020 |
Key Provisions at a Glance
The Employment Exchanges Act, 1959, addressed vacancy reporting, employment information, record inspection, and penalties.
| Provision | What it covered |
|---|---|
| Section 3: Exempt vacancies | Excluded vacancies in specified agricultural work, domestic service, unskilled office work, Parliament staff, and jobs lasting less than three months. |
| Section 4: Vacancy notification | Where the duty applied, employers had to notify the prescribed employment exchange before filling a vacancy. The employer still chose whom to hire. |
| Section 5: Information and returns | Covered employers could be required to submit prescribed returns or other information about vacancies and employment. |
| Section 6: Access to records | Authorized officers could inspect relevant records and seek information needed for returns under Section 5. |
| Section 7: Penalties | Prescribed fines for failures involving vacancy notification, employment information, and required returns. |
Is the Employment Exchanges Act Still in Force?
No. The Code on Social Security, 2020 repealed the Employment Exchanges Act, 1959 when the relevant provisions took effect on 21 November 2025. Section 164 of the Code lists it among the repealed enactments, along with the EPF Act, 1952 and the ESI Act, 1948.
However, the duty to report vacancies remains in force. Chapter XIII of the Code now governs employment information and vacancy notification. The Code also protects valid actions already taken under the old Act, within the limits of its savings clause. The Social Security (Central) Rules, 2026 replaced the old procedural rules. For historical reference, the Employment Exchanges Act, 1959 remains available on the India Code portal.
Who and What did the Act Cover?
The Act applied across India, but vacancy-reporting duties depended on the establishment and type of vacancy.
Key Terms
- Employment exchange: A government office that collected and shared information on jobs, jobseekers, and employers.
- Establishment: Any place where an industry, trade, business, or occupation was carried on.
Old Act vs Current Law
| Aspect | Old Act | Current Law |
|---|---|---|
| Private-sector threshold | Generally 25 or more employees | Non-government establishments with fewer than 20 employees are excluded, unless a different number is notified |
| Employment exchange | Government office | Career center can be an office, place, or portal providing specified career services |
| Excluded work | Specified agricultural work, domestic service, legislative staff, and other categories | Includes specified agricultural employment, domestic service, legislative staff posts, and jobs lasting fewer than 90 days |
The current law updates the definitions and coverage while retaining the basic framework for employment-related reporting.
What Applies to Employers Now?
- Submit Form-XXV: File the prescribed form for each reportable vacancy before recruitment begins.
- Identify the appropriate authority: Route specialized technical or scientific roles and multi-state recruitments to the Central Career Center, and localized vacancies to the Regional Career Center.
- Follow the notice period: Notify the Regional Career Center at least 15 days before the application closing date and the Central Career Center at least 40 days before.
- Report selection outcomes: Communicate the final recruitment outcome to the designated career center within 30 days of completing the recruitment process.
- File Form-XXVI: Submit the annual Employment Information Return to the Regional Career Center within 30 days of the end of the financial year.
During the transition, existing Employment Exchanges continue to function as Regional or Central Career Centers until further notification. For private-sector employers, reporting requirements apply from the date notified by the appropriate government.
A Central Government notification dated 8 May 2026 also exempts vacancies with total monthly remuneration below ₹11,000 from these reporting requirements.
Penalties: Then and Now
Fines under the Employment Exchanges Act, 1959, remained unchanged until its repeal. The Code on Social Security, 2020 follows a different penalty structure. It sets much higher fines for failures related to vacancy reports, returns, and employment information.
| Situation | Under the 1959 Act | Under the Code on Social Security, 2020 |
|---|---|---|
| Failing to notify a vacancy | Fine up to ₹500, rising to ₹1,000 for a repeat offense | Fine up to ₹50,000 (Section 133) |
| Refusal to submit a return, or filing false information | Fine up to ₹250, rising to ₹500 on a repeat (Section 7) | Up to six months in prison, or a fine up to ₹50,000, or both, for a dishonest return; specified failures to provide required information can also attract a fine up to ₹50,000 (Section 133) |
| Repeat offences | The higher fine above (Section 7) | Stricter punishment for repeat offenses, dealt with separately under the Code |
The ₹5,000 and ₹10,000 figures sometimes cited under the legacy law came from the 2013 Amendment Bill, which did not become law. The Code also allows eligible offenses to be compounded by paying a prescribed amount in lieu of prosecution.
Who Enforces Vacancy Reporting Now?
When the Employment Exchanges Act, 1959 was in force, vacancy reporting was tied to the employment-exchange system. That administrative route has now changed. The rules provide for an Executive Officer in each district. The Director of Employment, or an officer of equal or higher rank who controls the Regional Career Centers, designates this officer. For Central Career Centers, the corresponding arrangement is made through the Directorate General of Employment.
These officers can also verify the information an employer has filed. The Code allows them to access relevant records and documents for this purpose. Keep the records behind each vacancy report safe even after recruitment ends.
What Should Employers do Now?
Treat vacancy reporting as part of the recruitment compliance process. Employers can reduce missed filings by building a few simple controls into their hiring workflow:
- Assign responsibility: Designate an HR or compliance owner for vacancy reporting and related records.
- Add a pre-recruitment check: Confirm whether the establishment and vacancy fall within the reporting requirements before the position is advertised or filled.
- Set internal reminders: Build reporting deadlines into the recruitment workflow so statutory timelines are not missed.
- Maintain an audit trail: Keep vacancy details, submissions, recruitment outcomes, and related correspondence together for easy retrieval during an inspection.
- Review regulatory updates: Monitor notifications from the appropriate government for changes to coverage, thresholds, exemptions, or reporting requirements.
A compliance checklist for employers can help HR teams keep these checks organized alongside other statutory requirements.
FAQs
Is the Employment Exchanges Act Still in Effect?
No. The Employment Exchanges Act, 1959 was repealed on 21 November 2025. Vacancy reporting continues under the Code on Social Security, 2020, the Social Security (Central) Rules, 2026, and any notification that applies to your establishment.
Which Employers Must Report Job Vacancies after the Employment Exchanges Act was Repealed?
Public-sector establishments fall within the current reporting system. A private establishment should check whether it meets the 20-employee threshold. It should also check the commencement notification and the exclusions under the Code. A vacancy may fall outside the reporting duty even where the establishment itself meets the employee threshold.
What Replaced Forms ER-I and ER-II?
Forms ER-I and ER-II were prescribed under the repealed 1960 Rules. The 2026 Rules now use Form-XXV for reportable vacancies and Form-XXVI for the yearly Employment Information Return. Employers should use the new forms where the present reporting requirement applies.
Does Reporting a Vacancy Obligate Me to Hire Referred Candidates?
No. The hiring decision remains with the employer. The Code makes it clear that reporting a vacancy does not require you to appoint a person referred through a career center. Reporting and recruitment are related processes, but they are not the same obligation.
What is the Penalty for Failing to Report a Vacancy?
Where Section 133 applies, a reporting failure can attract a fine of up to ₹50,000. Dishonestly providing false information may also lead to imprisonment for up to six months, a fine up to ₹50,000, or both. Repeat offenses are dealt with separately under Section 134.
How do I Determine where to Report a Vacancy?
Check the vacancy first. Rule 56 decides whether it goes to a Regional or Central career center. Where digital reporting applies, the employer can complete the required filing through the National Career Service portal after confirming the route that applies to the post.
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