Shops and Establishments Act in Andhra Pradesh: 2026 Rules
Table of Contents
The Andhra Pradesh Shops and Establishments (Amendment) Act, 2025 came into force on 3 November 2025. It raised the daily working-hours limit from 8 to 10 and replaced the monthly overtime ceiling with a quarterly ceiling of 144 hours. It also permitted the employment of women at night, subject to statutory conditions.
Although the four central Labour Codes came into effect on 21 November 2025, they did not repeal the state legislation; consequently, employers in Andhra Pradesh must comply with both the State Act and the Central Codes.
Key Takeaways
- Every establishment must be registered within 30 days of commencing work.
- Working hours are limited to 10 hours a day and 48 a week.
- Overtime is payable at twice the ordinary rate, up to 144 hours a quarter.
- Women may be employed at night with their consent, subject to six statutory conditions.
- Establishments employing fewer than 20 workers are subject to select compliance provisions but remain exempt from statutory wage and register-maintenance rules.
What is the AP Shops and Establishments Act, 1988?
The Andhra Pradesh Shops and Establishments Act, 1988 is a state enactment that regulates registration, working hours, leave, wages, and termination of service in shops and commercial establishments. Enacted as Act No. 20 of 1988, it came into force on 1 November 1988, replacing the precursor Act of 1966.
The Andhra Pradesh Shops and Establishments Rules, 1990 prescribe the forms, fees, registers and returns. Following the state bifurcation in 2014, Telangana adopted the same legislation; however, subsequent amendments by the independent states mean the two versions are no longer identical.
Who does the Shops and Establishments Act in Andhra Pradesh Cover?
The Act applies to shops, commercial establishments, restaurants, residential hotels, lodging houses, theatres and other places of public amusement.
A ‘shop’ is defined as any premises where goods are sold, or services are rendered to customers, including connected offices, godowns, and warehouses.
A ‘commercial establishment’ encompasses any entity carrying on a trade, business, or profession, including banking and insurance offices.
Section 73 exempts certain establishments from the Act. The exemption extends to establishments of the Central and State Governments, local authorities, the Reserve Bank of India, railway establishments, mines, oil fields, and temporary bazaars held in connection with fairs or festivals for a duration not exceeding one month.
Establishments with Fewer Than 20 Workers
The 2025 amendment restricts the applicability of statutory provisions for small establishments employing fewer than 20 workers. Such establishments are subject only to the provisions on registration and renewal, working hours, rest intervals, holidays, employment of women, maternity benefit, leave, and termination of service. Notably, obligations regarding the payment of wages and maintenance of physical registers are excluded from this applicable list.
What Changed in 2025?
The amendment to the Shops and Establishments Act in Andhra Pradesh received the Governor’s assent on 15 October 2025 and was published in the Gazette on 21 October 2025 as Act No. 17 of 2025. By notification, the State Government made the amendment effective from 3 November 2025. The table below compares the provisions before and after the amendment.
| Provision | Before 3 November 2025 | From 3 November 2025 |
|---|---|---|
| Daily working hours | 8 hours | 10 hours |
| Spread-over on overtime days | 13 hours | 12 hours |
| Rest interval | 1 hour after 5 hours of work | 30 minutes after 6 hours of work |
| Overtime limit | 50 hours in a month | 144 hours in a quarter |
| Weekly limit including overtime | 62 hours | Provision omitted / Capped by quarterly overtime limit (144 hrs). |
| Employment of women at night | Permitted subject to prescribed safeguards | Permitted subject to consent and six conditions |
Key Provisions of the Shops and Establishments Act in Andhra Pradesh
The principal obligations of an employer under the Act and the Rules are set out below under seven heads.
Registration and Renewal
- Registration is mandatory for every establishment, irrespective of the number of employees.
- The application must be filed within 30 days of commencing work.
- Applications are submitted online through the Andhra Pradesh Labour Department.
- The Rules prescribe the registration fee according to the number of employees.
- Under the revised fee schedule implemented in 2003, registration fees range from ₹30 to ₹2,500, depending on workforce size.
- The registration certificate must be displayed at the premises.
- Changes in particulars and closure must be notified within 15 days.
- A certificate is valid until 31 December following the date of issue.
- The Rules permit renewal for up to three years.
- A late renewal incurs an additional fee of 25% or 50%.
- Since August 2021, renewal has been automated via online self-certification and fee payment, with integrated registration granted for a 3-year validity block.
- The Labour Department’s portal states that integrated registration is granted for three years.
Working Hours and Overtime
- Working hours are limited to 10 hours a day and 48 hours a week.
- Total hours, including overtime, must not exceed 12 in a day.
- Overtime is payable at twice the ordinary rate of wages.
- Overtime must not exceed 144 hours in a quarter.
- No employee may work overtime for more than seven consecutive days.
- Shops must remain closed on Sunday or on another notified day.
- Employees of other establishments are entitled to one whole holiday each week.
- Young persons (aged 14 to 18) are restricted to a maximum of 7 working hours per day and 42 hours per week.
- They are strictly prohibited from working overtime and from working between 7:00 PM and 6:00 AM.
Leave and Holidays
- Earned leave of 15 days accrues after 240 days of work in 12 months.
- Earned leave may be accumulated up to 60 days.
- Up to 8 days of earned leave may be encashed annually.
- Encashed leave is payable within one week of the application.
- Sick leave of 12 days is admissible each year.
- Casual leave of 12 days is admissible each year.
- Employees are entitled to 9 paid holidays and festival leaves annually, including 26 January (Republic Day), 1 May (May Day), 15 August (Independence Day), and 2 October (Gandhi Jayanti).
Employment of Women at Night
- A woman may work before 6:00 a.m. and after 8:30 p.m. with her consent.
- The employment must not contravene the Maternity Benefit Act, 1961.
- The employer must provide transportation to and from her residence.
- Toilets, washrooms, drinking water and adequately lit passages must be provided.
- Working conditions must be safe, secure and healthy.
- The establishment must comply with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
- Night shift engagement is prohibited for 16 weeks surrounding childbirth (including at least 8 weeks prior to expected delivery).
- Statutory maternity benefits apply as per the Maternity Benefit Act, 1961.
Wages and Termination of Service
- The wage period must not exceed one month.
- Wages are payable no later than the fifth day after the wage period ends.
- On termination, earned wages are payable within two working days.
- One month’s notice, or wages in lieu, is due after six months’ service.
- Service compensation, calculated at 15 days of average wages per completed year of continuous service, is payable upon completion of one year of service, provided gratuity is not separately applicable.
Registers, Records and Returns
- Registers of employment, wages and leave must be maintained.
- Records must be preserved for three years.
- Every employee must be issued a written appointment order.
- A copy of the appointment order must be furnished to the Inspector.
- Signboards and establishment name boards must prominently display the business name in Telugu script prior to any other language.
- Quarterly returns must be submitted by employers of 10 or more workers no later than the 10th day of the month immediately following the quarter.
Penalties
- A first contravention of the Rules attracts a fine of up to ₹10,000.
- A second or subsequent contravention attracts a fine of up to ₹20,000.
- Fines are imposed by an officer no lower than an Assistant Commissioner of Labour.
- An appeal lies to an officer not below the rank of Deputy Commissioner of Labour.
- Following the 2022 amendment, statutory penalty amounts were substantially increased from the original 1988 limits (previously ₹100 to ₹1,000).
How do the Labour Codes Apply to AP Shops and Establishments?
Parliament consolidated 29 Central enactments into four Labour Codes. Following the Government of Andhra Pradesh’s notification of state rules between June and August 2026, these codes operate alongside existing state legislation. No state enactment on shops and establishments was repealed, and the Shops and Establishments Act in Andhra Pradesh continues to apply. Between June and August 2026, the State Government notified its rules under each of the four codes.
The codes now govern minimum wages, the definition of wages, provident fund, employees’ state insurance, gratuity and standing orders. In the event of a conflict or repugnancy between a provision of the state Act and a Central Code, the Central Code generally prevails under Article 254 of the Constitution of India. The OSH Code separately regulates working hours in the establishments to which it applies, requiring employers to maintain dual compliance with both statutory frameworks.
How Andhra Pradesh Differs from Other States
The Shops and Establishments Act in Andhra Pradesh differs from the corresponding laws of other states in three respects:
- Mandatory registration applies to all establishments regardless of workforce headcount, whereas several operational obligations apply only to establishments employing 20 or more workers.
- IT and ITES establishments have been granted a five-year conditional exemption from specified provisions of the Act, effective from March 2025.
- Unlike neighboring Telangana, which restricts the 10-hour workday allowance exclusively to commercial establishments (excluding shops), Andhra Pradesh applies its daily working-hour limits uniformly across all covered establishments.
Conclusion
The Shops and Establishments Act in Andhra Pradesh is the principal enactment governing shops and commercial establishments in the state. While the state Act governs local operational matters, the Central Labour Codes regulate broader aspects such as wages, working conditions, and social security.
To ensure compliance with statutory overtime caps and regulatory returns, employers should maintain robust workforce attendance and payroll management systems.
Suggested Reading
FAQs
Is Registration under the Andhra Pradesh Shops and Establishments Act Mandatory for Small Businesses?
Yes, registration is mandatory regardless of headcount. The Act requires registration within 30 days of the commencement of work, and even single-proprietorship establishments operating without hired employees must register. In 2025, establishments engaging fewer than 20 workers were exempted from several provisions. Mandatory registration and statutory renewals remain explicitly excluded from this headcount exemption.
What are the Working Hours under the Shops and Establishments Act in Andhra Pradesh?
The Act limits working hours to 10 hours a day and 48 hours a week, and these limits have been in effect since 3 November 2025. Including overtime hours, total daily working hours for an employee cannot exceed 12 hours. Overtime in any quarter is restricted to 144 hours.
How Much Leave does the Shops and Establishments Act in Andhra Pradesh Provide?
An employee who has completed 240 days of work within a 12-month period is entitled to 15 days of earned leave, which may be accumulated up to a maximum of 60 days. Additionally, the Act mandates 12 days of sick leave and 12 days of casual leave per calendar year.
Is Periodic Renewal of the Registration Certificate Required in Andhra Pradesh?
Yes; however, the state introduced an automated online renewal process in August 2021. The registration is renewed when the employer files a self-certification and pays the prescribed fee online, and the Rules permit a renewal period of up to three years.
Have the Labour Codes Replaced the Shops and Establishments Act in Andhra Pradesh?
No. The codes replaced 29 central enactments on 21 November 2025, and the state enactment remains active and enforceable. The codes govern wages and social security. Registration and leave remain subject to the state Act.
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