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

ARRANGEMENT OF SECTIONS

SECTIONS

Short title, extent, commencement and application.
Definitions.
Power of Central Government to declare certain industries to be notified industries.
Leave.
Issue of appointment letter.
Application of certain Acts to sales promotion employees.
Maintenance of registers.
Inspectors.
Penalty.
Offences by companies.
Cognizance of offence.

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

Power to make rules.

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:—

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.

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;

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.

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

sec. 3(ii).

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

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.]

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.

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.

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

1976).

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

(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.]

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.

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.

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.

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

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).]

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.

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

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

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.]

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;

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.

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

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