THE SALES PROMOTION EMPLOYEES (CONDITIONS OF SERVICE) ACT, 1976 

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ARRANGEMENT OF SECTIONS 
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SECTIONS 

1.  Short title, extent, commencement and application. 
2.  Definitions. 
3.  Power of Central Government to declare certain industries to be notified industries. 
4.  Leave. 
5.  Issue of appointment letter. 
6.  Application of certain Acts to sales promotion employees. 
7.  Maintenance of registers. 
8.  Inspectors. 
9.  Penalty. 
10.  Offences by companies. 
11.  Cognizance of offence. 

11A. Effect of laws and agreements inconsistent with this Act. 

12.  Power to make rules. 

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THE SALES PROMOTION EMPLOYEES (CONDITIONS OF SERVICE) ACT, 1976 

ACT NO. 11 OF 1976 

[25th January, 1976.] 

An  Act  to  regulate  certain  conditions  of  service  of  sales  promotion  employees  in  certain 

establishments. 

BE it enacted by Parliament in the Twenty-sixth Year of the Republic of India as follows:— 

1.  Short  title,  extent,  commencement  and  application.—(1)  This  Act  may  be  called  the  Sales 

Promotion Employees (Conditions of Service) Act, 1976. 

(2) It extends to the whole of India. 

(3)  It  shall  come  into  force  on  such  date1as  the  Central  Government  may,  by  notification  in  the 

Official Gazette, appoint and different dates may be appointed for different States. 

(4) It shall apply in the first instance to every establishment engaged in pharmaceutical industry. 

(5) The Central Government may, by notification in the Official Gazette, apply the provisions of this 
Act, with effect from such date as may be specified in the notification, to any other establishment engaged 
in any notified industry. 

2. Definitions.—In this Act, unless the context otherwise requires,— 

(a) “establishment” means an establishment engaged in pharmaceutical industry or in any notified 

industry; 

(b) “notified industry” means an industry declared as such under section 3; 

(c) “prescribed” means prescribed by rules made under this Act; 

2[(d)  “sales  promotion  employees”  means  any  person  by  whatever  name  called  (including  an 
apprentice) employed or engaged in any establishment for hire or reward to do any work relating to 
promotion of sales or business, or both, but does not include any such person— 

(i)  who,  being  employed  or  engaged  in  a  supervisory  capacity,  draws  wages  exceeding 

sixteen hundred rupees per mensem; or 

(ii) who is employed or engaged mainly in a managerial or administrative capacity. 

Explanation.—For  the  purposes  of  this  clause,  the  wages  per  mensem  of  a  person  shall  be 
deemed  to  be  the  amount  equal  to  thirty  times  his  total  wages  (whether  or  not  including,  or 
comprising only of, commission) in respect of the continuous period of his service falling within the 
period of twelve months immediately preceding the date with reference to which the calculation is to 
be made, divided by the number of days comprising that period of service;] 

(e)  all  words  and  expressions  used  but  not  defined  in  this  Act  and  defined  in  the  Industrial 

Disputes Act, 1947 (14 of 1947), shall have the meanings respectively assigned to them in that Act. 

3.  Power  of  Central  Government  to  declare  certain  industries  to  be  notified  industries.—The 
Central  Government  may,  having  regard  to  the  nature  of  any  industry  (not  being  pharmaceutical 
industry), the number of employees employed in such industry to do any work relating to promotion of 
sales or business or both, the conditions of service of such employees and such other factors which, in the 
opinion of the Central Government, are relevant, declare such industry to be a notified industry for the 
purposes of this Act. 

1. 6th March, 1976, vide notification No. S.O. 176(E), dated 6th March, 1976, see Gazette of India, Extraordinary, Part II,  

sec. 3(ii). 

2. Subs. by Act 48 of 1986, s. 2, for clause (d) (w.e.f. 6-5-1987).  

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4.  Leave.—1[(1)]  In  addition  to  such  holidays,  casual  leave  or  other  kinds  of  leave  as  may  be 

prescribed, every sales promotion employee 2*** shall be granted, if so requested for— 

(a) earned leave on full wages for not less than one- eleventh of the period spent on duty; 

(b) leave on medical certificate on one-half of the wages for not less than one-eighteenth of the 

period of service. 

3[(2) The maximum limit up to which a sales promotion employee may accumulate earned leave shall 

be such as may be prescribed. 

(3) The limit up to which the earned leave may be availed of at a time by a sales promotion employee 

and the reasons for which such limit may be exceeded shall be such as may be prescribed. 

(4) A sales promotion employee shall,— 

(a) when he voluntarily relinquishes his post or retires from service, or 

(b)  when  his  services  are  terminated  for  any  reason  whatsoever  (not  being  termination  as 

punishment), 

be  entitled  to  cash  compensation,  subject  to  such  conditions  and  restrictions  as  may  be  prescribed 
(including conditions by way of specifying the maximum period for which such cash compensation shall 
be payable), in respect of the earned leave earned by him and not availed of. 

(5)  Where  a  sales  promotion  employee  dies  while  in  service,  his  heirs  shall  be  entitled  to  cash 

compensation for the earned leave earned by him and not availed of. 

(6) The cash compensation which will be payable to a sales promotion employee or, as the case may 
be, his heirs in respect of any period of earned leave for which he or his heirs, as the case may be, is or are 
entitled  to  cash compensation  under  sub-section  (4) or  sub-section  (5),  as the  case  may  be,  shall  be  an 
amount equal to the wages due to such sales promotion employee for such period.] 

5.  Issue  of  appointment  letter.—Every  employer  in  relation  to  a  sales  promotion  employee  shall 

furnish to such employee a letter of appointment, in such form as may be prescribed,— 

(a) in a case where he holds appointment as such at the commencement of this Act, within three 

months of such commencement; and 

(b) in any other case, on his appointment as such. 

6.  Application  of  certain  Acts  to  sales  promotion  employees.—(1)  The  provisions  of  the 
Workmen’s  Compensation  Act,  1923  (8  of  1923),  as  in  force  for  the  time  being,  shall  apply  to,  or  in 
relation to, sales promotion employees as they apply to, or in relation to, workmen within the meaning of 
that Act. 

4[(2) The provisions of the Industrial Disputes Act, 1947 (14 of 1947), as in force for the time being, 
shall apply to, or in relation to, sales promotion employees as they apply to, or in relation to, workmen 
within the meaning of that Act and for the purposes of any proceeding under that Act in relation to an 
industrial  dispute,  a  sales promotion  employee  shall be  deemed  to  include  a  sales  promotion employee 
who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute 
or whose dismissal, discharge or retrenchment had led to that dispute.] 

(3) The  provisions of  the Minimum  Wages  Act,  1948  (11  of 1948),  as in  force  for the  time  being, 
shall apply to, or in relation to, sales promotion employees as they apply to, or in relation to, employees 
within the meaning of that Act. 

1.  Section 4 renumbered as sub-section (1) thereof by Act 48 of 1986, s. 3 (w.e.f. 8-3-1976). 
2. The words  and brackets “drawing wages (being wages, not including any commission)” omitted by s. 3, ibid. (w.e.f. 8-3-

1976).   

3. Ins. by s. 3, ibid. (w.e.f. 8-3-1976).  
4. Sub-section (2) shall stand omitted (date to be notified) by Act 46 of 1982, s. 2.  

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(4) The provisions of the Maternity Benefit Act, 1961 (53 of 1961), as in force for the time being, 
shall apply to, or in relation to, sales promotion employees, being women, as they apply to, or in relation 
to, women employed, whether directly or through any agency, for wages in any establishment within the 
meaning of that Act. 

(5) The provisions of the Payment of Bonus Act, 1965 (21 of 1965), as in force for the time being, 
shall apply to, or in relation to, sales promotion employees as they apply to, or in relation to, employees 
within the meaning of that Act. 

(6) The provisions of the Payment of Gratuity Act, 1972 (39 of 1972), as in force for the time being, 
shall apply to, or in relation to, sales promotion employees as they apply to, or in relation to, employees 
within the meaning of that Act. 

1[(7) Notwithstanding anything contained in the foregoing sub-sections,— 

(a)  in  the  application  of  any  Act  referred  to  in  any  of  the  said  sub-sections  to  sales  promotion 
employees, the wages of a sales promotion employee for the purposes of such Act, shall be deemed to 
be his wages as computed in accordance with the provisions of this Act; 

(b)  where  an  Act  referred  to  in  any  of  the  said  sub-sections  provides  for  a  ceiling  limit  as  to 
wages so as to exclude from the purview of the application of such Act persons whose wages exceed 
such  ceiling  limit,  such  Act  shall  not  apply  to  any  sales  promotion  employee  whose  wages  as 
computed in accordance with the provisions of this Act exceed such ceiling limit.] 

7.  Maintenance  of  registers.—Every  employer  in  relation  to  an  establishment  shall  keep  and 

maintain such registers and other documents and in such manner as may be prescribed. 

8. Inspectors.—(1) The State Government may, by notification in the Official Gazette, appoint such 
persons as it thinks fit to be Inspectors for the purposes of this Act and may define the local limits within 
which they shall exercise their functions. 

(2) Any Inspector appointed under sub-section (1) may, for the purpose of ascertaining whether any 

of the provisions of this Act have been complied with in respect of an establishment,— 

(a) require an employer to furnish such information as he may consider necessary; 

(b)  at  any  reasonable  time  enter  the  establishment  or  any  premises  connected  therewith  and 
require any one found in charge thereof to produce before him for examination any registers and other 
documents relating to the employment of sales promotion employees; 

(c) examine with respect to any matter relevant to any of the purposes aforesaid, the employer, 
his  agent  or  servant  or  any  other  person  found  in  charge  of  the  establishment  or  any  premises 
connected  therewith  or  any  person  whom  the  Inspector  has  reasonable  cause  to  believe  to  be  or  to 
have been a sales promotion employee in the establishment; 

(d) make copies of or take extracts from any register or other documents maintained in relation to 

the establishment under this Act; 

(e) exercise such other powers as may be prescribed. 

(3) Every Inspector shall be deemed to be a public servant within the meaning of  section 21 of the 

Indian Penal Code, 1860 (45 of 1860) 

(4)  Any  person  required  to  produce  any  register  or  other  document  or  to  give  information  by  an 

Inspector under sub-section (2) shall be legally bound to do so. 

9. Penalty.—If any employer contravenes the provisions of section 4 or section 5 or section 7 or any 

rules made under this Act, he shall be punishable with fine which may extend to one thousand rupees. 

1. Ins. by Act 48 of 1986, s. 4 (w.e.f. 6-5-1987).  

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STATE AMENDMENT 

Union Territory of Jammu and Kashmir and Ladakh 

Insertion of new section-After section 9, insert- 

“9A.  Compounding  of  offences.-(1)  Any  offence  punishable  under  sections 4, 5 and 7 or  any 
rules  made  under  this  Act  may,  either  before  or  after  the  institution  of  the  prosecution,  on  an 
application by the alleged offender, be compounded by payment of compounding amount not more 
than fifty thousand by such officer or authority as the appropriate Government may, by notification in 
the Official Gazette, specify in this behalf: 

Provided that the appropriate Government may, by notification in the Official Gazette, amend the 

said specified compounding amount: 

Provided further that the offences of the same nature committed by the same offender for more 

than three occasions shall not be compoundable: 

Provided also that such offences shall be compounded only after the alleged offender has acted to 

the satisfaction of such officer or authority that such offence is not continued any further: 

(2) Where an offence has been compounded under sub-section (1), no further proceedings shall 
be taken against the offender in respect of such offence in respect of such offence and the offender, if 
in custody, shall be released or discharged.". 

[Vide  Union  Territory  of  Jammu  and  Kashmir  Reorganisation  (Adaptation  of  Central  Laws)  Second 
Order, 2020, vide Notification No. S.O. 3465(E), dated (5-10-2020) and Vide Union Territory of Ladakh 
Reorganisation (Adaptation of Central Laws) Order, 2020, Notification No. S.O. 3774(E), dated (23-10-
2020).] 

10.  Offences  by  companies.—(1)  Where  an  offence  under  this  Act  has  been  committed  by  a 
company,  every  person  who,  at  the  time  the  offence  was  committed,  was  in  charge  of,  and  was 
responsible to, the company for the conduct of the business of the company, as well as the company, shall 
be  deemed  to  be  guilty  of  the  offence  and  shall  be  liable  to  be  proceeded  against  and  punished 
accordingly: 

Provided  that  nothing  contained  in  this  sub-section  shall  render  any  such  person  liable  to  any 
punishment provided in this section, if he proves that the offence was committed without his knowledge 
or that he exercised all due diligence to prevent the commission of such offence. 

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been 
committed  by  a  company  and  it  is  proved  that  the  offence  has  been  committed  with  the  consent  or 
connivance of, or is attributable to, any neglect on the part of any director, manager, secretary or other 
officer  of  the  company,  such  director,  manager,  secretary  or  other  officer  shall  also  be  deemed  to  be 
guilty of such offence and shall be liable to be proceeded against and punished accordingly. 

(3) For the purposes of this section,— 

(a) “company” means any body corporate and includes a firm or other association of individuals; 

and 

(b) “director”, in relation to a firm, means a partner in the firm. 

11.  Cognizance  of  offence.—(1)  No  court  inferior  to  that  of  a  Metropolitan  Magistrate  or  a 

Magistrate of the first class shall try any offence punishable under this Act. 

(2) No court shall take cognizance of an offence under this Act, unless the complaint thereof is made 

within six months of the date on which the offence is alleged to have been committed. 

1[11A. Effect of laws and agreements inconsistent with this Act.—(1) The provisions of this Act or 
of any rule made thereunder shall have effect, notwithstanding anything inconsistent therewith contained 

1. Ins. by Act 69 of 1982, s. 2 (w.e.f. 13-11-1982).  

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in any other law or in the terms of any award, agreement, settlement or contract of service, whether made 
before or after the coming into force of this Act: 

Provided that where under any such law, award, agreement, settlement or contract of service, a sales 
promotion employee is entitled to benefits in respect of any matter which are more favourable to him than 
those to  which  he  would  be  entitled  under  this  Act,  the  sales  promotion  employee  shall continue  to be 
entitled  to  the  more  favourable  benefits  in  respect  of  that  matter,  notwithstanding  that  he  is  entitled  to 
receive benefits in respect of other matters under this Act. 

(2)  Nothing  contained  in  this  Act  shall  be  construed  to  preclude  a  sales  promotion  employee  from 
entering into an agreement with his employer for granting him rights or privileges in respect of any matter 
which are more favourable to him than those to which he would be entitled under this Act.] 

12. Power to make rules.—(1) The Central Government may, by notification in the Official Gazette, 

make rules to carry out the purposes of this Act. 

(2)  In  particular  and  without  prejudice  to  the  generality  of  the  foregoing  power,  such  rules  may 

provide for— 

(a) the kinds of leave that may be granted to a sales promotion employee 1[, the limit up to which 
he may accumulate earned leave, the limit up to which he may avail of earned leave at a time and the 
reasons  for  which  such  limit  may  be  exceeded,  the  conditions  and  restrictions  subject  to  which  he 
may be entitled to cash compensation] under section 4; 

(b) the form of the letter of appointment to be furnished under section 5; 

(c) the registers and other documents to be kept and maintained under section 7 and the manner in 

which such registers and other documents may be kept and maintained; 

(d) any other matter which has to be, or may be prescribed. 

(3) Every rule made by the Central Government under this Act shall be laid, as soon as may be after it 
is made, before each House of Parliament while it is in session, for a total period of thirty days which may 
be comprised in one session or in two or more successive sessions, and if, before the expiry of the session 
immediately following the session or the successive sessions aforesaid, both Houses agree in making any 
modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter 
have effect only in such modified form or be of no effect, as the case may be; so, however, that any such 
modification or annulment shall be without prejudice to the validity of anything previously done under 
that rule. 

1. Ins. by Act 48 of 1986, s. 5 (w.e.f. 8-3-1976). 

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