The 10th Employee Rule: When Does Your Company Need an Internal Committee?

The 10th Employee Rule: When Does Your Company Need an Internal Committee?

Introduction

The 10th employee rule under the POSH Act is an important compliance requirement for employers in India. The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, commonly known as the POSH Act, requires certain workplaces to establish an Internal Committee to address complaints of sexual harassment.

A common question among employers is, "When does a company need an internal committee?" When does a company need an internal committee? 'The key threshold is when a workplace has 10 or more workers. Understanding this requirement helps organizations take timely steps towards workplace safety and POSH compliance for 10 employees.

What Is the POSH Act 10-Employee Rule?

Under the POSH Act 10 employees rule, an employer is required to constitute an Internal Committee at a workplace where the number of workers is 10 or more. The requirement applies to workplaces covered by the POSH Act, including offices, branches, departments, establishments, and other applicable workplaces. Therefore, employers should monitor their workforce strength rather than waiting until a complaint is received.

The POSH Internal Committee for 10 employees is responsible for receiving and addressing complaints of sexual harassment and helping the organisation maintain a safe and compliant workplace.

When Does a Company Need an Internal Committee?

A company generally needs an Internal Committee when it has 10 or more workers at a workplace. The POSH Internal Committee requirement is not limited to large corporations. Small and growing businesses must also consider this requirement once their workforce reaches the statutory threshold.

For example, if a company starts with eight employees and later hires two additional employees, it reaches the threshold of 10 workers. The employer should then take steps for Internal Committee formation under POSH Act requirements.

Does the 10-Employee Rule Apply to Every Workplace?

The requirement applies to workplaces covered by the POSH Act. The Act covers a broad range of workplaces, including private organizations, companies, offices, establishments, institutions, and other workplaces specified under the legislation.

The important point is that the requirement is considered at the workplace level. Organizations operating through multiple offices or branches should therefore assess the applicable requirements for each workplace.

This makes it important for employers to maintain accurate employee and workplace records and review their POSH obligations whenever there is a change in workforce strength or workplace structure.

What Happens When a Company Reaches 10 Employees?

Once the applicable workplace reaches the threshold of 10 or more workers, the employer should constitute an Internal Committee in accordance with the POSH Act.

The employer should:

1. Identify suitable members who meet the statutory requirements.
2. Appoint the Presiding Officer and other required members.
3. Issue a formal order constituting the Committee.
4. Communicate the Committee's details to employees.
5. Establish a mechanism for receiving complaints.
6. Conduct appropriate POSH awareness and training programs.
7. Maintain the records and documentation required for compliance.

Taking these steps promptly helps the organization meet its POSH Internal Committee requirement and establish a structured mechanism for handling workplace sexual harassment complaints.

Who Should Be on the Internal Committee?

The Internal Committee under the POSH Act, 2013, must have the composition prescribed by law.

Generally, it includes:

1. A senior female employee as the Presiding Officer.
2. At least two employees who have experience in social work, commitment to the cause of women, or appropriate legal knowledge, as applicable.
3. One external member from an NGO, association, or person familiar with issues relating to sexual harassment.

The employer must ensure that the Committee is properly constituted and that its members understand their responsibilities.

What If a Company Has Fewer Than 10 Employees?

A workplace with fewer than 10 workers is generally not required to constitute an Internal Committee under Section 4 of the POSH Act.

However, this does not mean that such workplaces are outside POSH requirements. Where an Internal Committee is not constituted because the workplace has fewer than 10 workers, complaints can generally be made to the Local Committee constituted by the appropriate authority under the Act.

Employers should also communicate their policy against sexual harassment and provide employees with information about the available complaint mechanism.

Does Every Branch or Office Need Its Own Internal Committee?

The Internal Committee under the POSH Act is constituted at the workplace level. Therefore, businesses with multiple offices, branches, or establishments should carefully assess their compliance obligations for each workplace.

If an organization operates from different locations, it should not automatically assume that one Committee will satisfy every workplace-level requirement. The structure and circumstances of the organization should be reviewed to determine the appropriate arrangement.

Key Responsibilities of the Internal Committee

The Internal Committee has several important responsibilities, including:

• Receiving complaints of sexual harassment.
• Conducting inquiries according to the applicable procedure.
• Providing parties an opportunity to be heard.
• Maintaining confidentiality during the proceedings.
• Preparing inquiry findings and recommendations.
• Recommending appropriate action where the complaint is established.
• Promoting awareness of POSH requirements.
• Conducting or supporting employee awareness programs.
• Preparing the required annual report.
• Maintaining relevant records and documentation.

The Committee should function independently and handle complaints fairly and confidentially.

Consequences of Not Constituting an Internal Committee

Failure to comply with the POSH Act can expose an employer to legal and regulatory consequences.

Under the Act, non-compliance can attract a fine of up to Rs 50000. Repeated violations can result in enhanced consequences, which may include cancellation, non-renewal, or withdrawal of licences, registrations, or approvals, wherever applicable.

Therefore, establishing a POSH Committee for companies with 10 employees is not merely an administrative exercise. It forms an important part of an employer's statutory compliance responsibilities.

How to Stay POSH Compliant After Constituting the Committee

Constituting the Committee is only the beginning. Employers should maintain ongoing compliance by:

1. Conducting regular POSH awareness sessions.
2. Training Internal Committee members.
3. Displaying required information about the Committee and complaint mechanism.
4. Maintaining confidentiality of complaints and proceedings.
5. Keeping proper records of inquiries and actions taken.
6. Filing the applicable annual report.
7. Reviewing the POSH policy periodically.
8. Updating Committee members when there are changes in the organisation.

These measures help businesses maintain effective POSH compliance for 10 employees and beyond.

Conclusion

The 10th employee rule under the POSH Act is an important compliance milestone for growing businesses. Once a covered workplace reaches 10 or more workers, the employer should assess and fulfil the POSH Internal Committee for 10 employees requirement without delay.

Proper Internal Committee formation under POSH Act requirements, employee awareness, appropriate documentation, and regular compliance measures can help organizations establish a safer workplace and meet their obligations under the law.