Hi everybody,

I would like to know which are the statutory and regulatory bodies that need to be informed if I am planning to close the factory in the month of December. As I know, I have to inform the Factories Inspectorate. Apart from this, which are the other statutory and regulatory bodies I have to inform?

From India, Mumbai

Hi Vinay, Just wanted a clarity.. whether its a temporary closure or permanent closure?
From India, Bangalore

Dear Vinay,

Intimation has to be given to the factory inspector and Joint Director of Health and Safety with filled-in prescribed forms containing details such as the number of employees, muster roll, reason for closure, type of closure, etc. Additionally, give intimation to the ESI and PF office. Notification for closure depends on the employee strength in the organization as mentioned below.

Closure:

An employer who intends to close down an industrial undertaking wherein 50 workmen or more but less than 100 are employed or were employed during the preceding 12 months has to serve a notice to the Government in "Form Q" at least 60 days before the date of intended closure, stating the reasons for the proposed closure as laid down under Section 25FFA of the Industrial Disputes Act, 1947.

In respect of an industrial undertaking employing 100 or more workmen on average in the preceding 12 months, the employer has to obtain prior approval of the Government at least 90 days before the date of intended closure by submitting an application in Form QA to the Secretary to the Government (Labour), as stipulated under Section 25(O)(1) of the Industrial Disputes Act, 1947. A copy of the application shall be served simultaneously on the representatives of the workmen as well.

The Government shall grant such approval if it is satisfied with the genuineness and adequacy of the reasons stated for closure, the interests of the general public, and all other relevant factors. The Government will communicate the order within 60 days from the date of the application for closure by the employer.

From India, Bangalore
  • CA
    CiteHR.AI
    (Fact Checked)-The user reply contains accurate information regarding the statutory requirements for factory closure, including notification to the Factory Inspectorate, ESI, and PF offices. The details provided are in alignment with the Industrial Disputes Act, 1947. (1 Acknowledge point)

  • Thank you, Vijay, for the response. It is a permanent closure wherein the existing company shall close. All the workers are on a contract basis. On-roll employees shall be moved to another group company. The average number of on-roll employees for the year 2015 is 25.
    From India, Mumbai

    Dear Vinay,

    Please refer to the details below, as they may be fruitful in this regard.

    Procedure for the closure of the Factory:

    1. Intimation to the concerned factory inspector before 90 days of closure.
    2. Update on closing the factory.
    3. Update on the number of workers in the factory.
    4. Period of closure.
    5. Type of closure.
    6. Submission of Form-32 (Rule 127(3)1).
    7. Surrender a copy of the Service Tax, Sales Tax, EPF Registration, ESIC Registration, and other registration copies.

    Transfer the employees to another unit without affecting their position and scale of payment, and inform the same to the factory inspector either directly or through a letter. If the establishment is closed permanently, it is necessary to pay 15 days' salary to the worker and inform the same to the factory inspector either directly or through a letter.

    Thank you.

    From India, Hyderabad
  • CA
    CiteHR.AI
    (Fact Checked)-The user's reply contains accurate information regarding the procedure for closing a factory, including the steps to be taken and the notifications required to regulatory bodies. The user's response is precise and covers the essential aspects of factory closure compliance. (1 Acknowledge point)

  • Dear Vinay,

    In addition to statutory obligations, it is advisable to inform the following agencies as well:

    1. Labour Commissioner under whose jurisdiction the falls.
    2. Electricity Authority for minimum charges during the period.
    3. Pollution Control Board for air and water.
    4. Water Supply Organization.
    5. Local police station for safety.
    6. Fire Department.

    These suggestions are to avoid future unforeseen liabilities and cases.

    Regards

    From India, Mumbai
  • CA
    CiteHR.AI
    (Fact Checked)-The user reply is correct and provides valuable additional information for informing various agencies when closing a factory. (1 Acknowledge point)

  • Factory Act - Application for Notice of Closure of Factory (Form-29)
    From India

    Factory Act - Application for Notice of Closure of Factory (Form-29) in tamilnadu
    From India
  • CA
    CiteHR.AI
    (Fact Checked)-Factory Act - Application for Notice of Closure of Factory (Form-29) is required to be submitted to the Chief Inspector of Factories in Tamil Nadu as per Section 25-O of the Industrial Disputes Act, 1947. (1 Acknowledge point)

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