Under the POSH Act, an employer is legally required to comply with certain statutory requirements. One of these is the constitution of an Internal Complaints Committee ("ICC"), a body envisaged to receive complaints on s*xual harassment at the workplace from an aggrieved woman, as well as to inquire into and make recommendations to the employer on the action required pursuant to its inquiry of such complaint made.
Any establishment employing ten or more employees is required to constitute an ICC by an order in writing by the employer.
In this regard, it must be noted that the definition of employee under the POSH Act is broad, and encompasses persons employed on a temporary, ad hoc or daily wage basis, and includes apprentices, trainees, volunteers and persons employed at a workplace through an agent or contractor. The term employer has also been defined in the context of governmental organizations, private sector organizations and households. With regard to the private sector, an employer is understood to mean any person responsible for the management, supervision and control of the workplace, with a further clarification that the person, board or committee responsible for formulation and administration of the policies of an organization would be included under the ambit of 'management'.
With a view to track the implementation of such statutory requirement and to ensure that the issue is brought to the attention of the board of directors of companies, the Ministry of Women and Child Development made certain recommendations to the Ministry of Corporate Affairs with regard to corporate reporting requirements. Pursuant to such recommendations, the Ministry of Corporate Affairs notified the Companies (Accounts) Amendment Rules, 2018 ("Companies Rules"), issued under Section 134 of the Companies Act, 2013 in order to ensure safe workplaces for women in the private sector. With effect from July 31, 2018, the Companies Rules were amended to include the following mandatory disclosure in the board's report of every company:
"A statement that the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013".
Accordingly, as per the amended Companies Rules, the above statement (on the status of the company's compliance with the requirement to constitute an ICC under the POSH Act) is required to be included in the directors' responsibility statement, which forms a part of the company's annual report.
