Sales Promotion Employees (Conditions of Service) Act, 1976 : Explanation, Rules, Procedures

Sales Promotion Employees (Conditions of Service) Act, 1976 : Explanation, Rules, Procedures

The act was created with the objective of regulating conditions of service of sales promotion employees in certain establishments. In the initial stages the act applied to only pharmaceutical industry but vide Ministry of Labour & Employment Notification No. S. O. 217 (E), dated January 31, 2011 the act now applies to the following industries:-

1. Cosmetics, soaps, household cleaners and disinfectant  
2. Readymade garments  
3. Soft drink manufacturing industries 
4. Biscuit and confectionaries  
5. Ayurvedic, Unani and Homeopathic Medicines  
6. Automobiles including accessories and spare parts  
7. Surgical equipment, artificial prosthesis and diagnostics 
8. Electronics, computers including accessories and spares 
9. Electrical appliances  
10. Paints and varnishes  

Who is a Sales Promotion Employee:-

i. A Person
ii. Including Apprentice
iii. Employed or Engaged
iv. For Hire or Reward
v. To do any work relating to promotion of Sales or Business or Both

But will not include:-

  • One engaged in supervisory capacity and draws a wages greater than Rs 1600 per mensem or
  • Is engaged in managerial or administrative capacity.

Leave Entitlement Procedure and Compliance:-

Part A: Mandatory Holidays

Under rule 3 of The Sales Promotion Employees (Conditions of Service) Rules, 1976, the provisions under the act or the rules will apply notwithstanding anything contained in any contract, award or any other law. But if term of service or provisions of other laws are more beneficial then they will prevail only to the extent they are more beneficial.

According to rule 4, all such employees will be granted a mandatory 10 days holiday in a calendar year. Under rule 5, if a sales promotion employee is required to attend to his duties on a holiday, a compensatory holiday shall be given to him, within thirty days immediately following the holiday, on a day mutually agreed upon by him and his employer. Under rule 6, wages must be paid in full for the above mentioned holidays. Under rule 7, every such employee will be granted a weekly holiday with wages.

For availing leaves mentioned above other then day of weekly rest, shall apply to the competent officer of the establishment at least 30 days before the leave. This can be done away with in case of urgent or unforeseen circumstances. Also this will not apply in the case of casual leave, leave on medical certificate and quarantine leave. Under rule 10 if any such request is refused or postponed the competent officer must record a reason in writing and send the same to the employee. Under rule 12 any holiday, including a weekly rest day, intervening during any leave, except casual leave, granted under these rules shall form part of the period of leave.

Under Rule 13, the establishment may recall a sales promotion employee on leave if the employer considers it necessary to do so and in the event of such recall the employee shall be entitled to travelling allowance for the journey undertaken by him to join duty if at the time of recall the employee is spending his leave at a place other than his headquarters.   The travelling allowance which shall be paid to a sales promotion employee under sub-rule (1) shall be determined in accordance with the rules of the establishment governing travelling allowance for journeys undertaken by the employees in the course of their duties.

Part B: Earned Leave

Under section 4(1), In addition to those leaves prescribed under the rules, every such employee will get an earned leave on full wages for not less than 1/11th of the period spent on duty. Along with this a leave on medical certificate on ½ wages will be given of not less than 1/18th of the period of service.

Under rule 14, the maximum limit up to which earned leave can be accumulated shall be 180 days out of which a sales promotion employee can avail himself of 90 days at a time: 

Provided that where a sales promotion employee is suffering from any lingering illness such as, tuberculosis, cancer, leprosy, heart disease or mental illness, or any disability which prevents him from attending to his duties, the competent authority (not competent officer of the company) may allow the sales promotion employee to avail himself of earned leave for any period exceeding 90 days at a time.

Cash Compensation on Earned Leave:

Reading section 4 along with rule 14, when a sales promotion employee voluntarily relinquishes his post, or retires from service on reaching the age of superannuation, he shall be entitled to cash compensation for earned leave earned by him and not availed of:

Provided that a sales promotion employee shall not be entitled to cash compensation for earned leave not availed of for a period exceeding 120 days. Along with this where a sales promotion employee dies while in service his heirs shall be entitled to cash compensation for the entire earned leave due to such employee and not availed of. Also where a sales promotion employee’s services are terminated for any reason whatsoever (not being termination as punishment), he shall be entitled to cash compensation for the entire earned leave due to him and not availed of. The cash compensation payable under this rule in respect of earned leave shall be equal to the amount of wages due to the sales promotion employee for the period of leave not availed of or refused.

Part C: Medical Leave

For the purposes of availing leave on medical certificate under section 4, the sales promotion employee shall produce a medical certificate from an authorised medical attendant. Leave on medical certificate may be taken in continuation of earned leave. A sales promotion employee shall be entitled at his option to convert leave on medical certificate on one-half of the wages to half the amount of leave on full wages.

Part D: Quarantine Leave

Where, in consequence of the presence of an infectious disease, in the house-hold of a sales promotion employee, his attendance is considered hazardous to the health of other people, the employee concerned may be granted quarantine leave. The quarantine leave may be granted for a period up to 30 days on the recommendation of the authorised medical attendant or Public Health Officer. A sales promotion employee on quarantine leave shall be treated as on duty for all purposes.

Part E: Leave At Discretion of Employer

Extraordinary Leave: A sales promotion employee may be granted extraordinary leave in special circumstances without wages at the discretion of the employer.

Leave not due: A sales promotion employee, who has no leave to his credit, may be granted leave not due, at the discretion of the employer.

Study leave: A sales promotion employee may be granted study leave with or without wages at the discretion of the employer

Part F: Casual Leave:

Under Rule 20, a sales promotion employee shall be eligible for casual leave for fifteen days in a calendar year. Casual leave not availed of during a calendar year shall not be carried forward to the following year. The sales promotion employee may take any amount of casual leave at a time and casual leave may be combined with any other kind of leave. An employee on casual leave shall be entitled to wages as if he was on duty.

Other Welfare Acts That With Apply To Such Employees:

The Following Acts:-

i. Employees' Compensation Act, 1923  
ii. Industrial Disputes Act, 1947  
iii. Minimum Wages Act, 1948  
iv. Maternity Benefit Act, 1961
v. Payment of Bonus Act, 1965 
vi. Payment of Gratuity Act, 1972

Shall apply to the sales promotion employees as if they are eligible under those acts. But if any employee is not eligible only due to wage ceiling limit then they will be excluded. For all purpose wages under this act will be taken for computation under the above mentioned acts.

Mandatory Procedures Under The Act and Rules:

Part A: Appointment Letter

Under Section 5, every such employee must be given an appointment letter from employer on date of appointment. Under Rule 22, the letter must be in prescribed FORM A. Such must be communicated to employee by personal service with proper receipt or by registered post acknowledgement due.

Part B: Maintenance of Registers

Every establishment shall prepare and maintain the following registers and records, namely:

(a) Register of Sales Promotion Employees in Form B;
(b) Service Books for every employee in Form C;
(c) Register of Service Books in Form D;
(d) Leave Account of each employee in Form E.


Akash Kapoor 
on 07 April 2017
Published in Labour & Service Law
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