Annual Compliance for Employers in India Under Prevention of Sexual Harassment (POSH) Legislation

Posted by Written by Naina Bhardwaj Reading Time: 5 minutes

The Prevention of Sexual Harassment (POSH) Act in India and its corresponding Rules require a mandatory annual report to be submitted by the employer to the District Officer and is also part of reporting obligations to the Registrar of Companies.

The Sexual Harassment (Prevention, Prohibition, and Redressal) Act, 2013, commonly known as the POSH Act, along with the Sexual Harassment (Prevention, Prohibition, and Redressal) Rules, 2013, form what is called the “POSH Law” and place specific responsibilities on employers in India.

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Among these obligations are annual reporting requirements. Employers in India are required to submit two distinct reports indicating compliance with the POSH legislation:

  1. Annual report to the employer and district officer: The annual report is prepared by the Internal Complaints Committee (constituted under the POSH Act) of the organization and submitted to the employer and the District Officer, respectively. This report outlines the actions taken by the organization to prevent and address sexual harassment and the overall company compliance with the POSH Law.
  2. Report to the registrar of companies: In 2018, the Ministry of Corporate Affairs (MCA) introduced an amendment to the Companies (Accounts) Rules 2014. As a result, companies are now obligated to include a statement in the Director’s Report confirming their compliance with the provisions regarding the constitution of the Internal Complaints Committee. This disclosure is made in the Director’s report, which is then filed with the Registrar of the company. The Director’s Report is submitted along with the annual returns to the Registrar of Companies.

Read: HR Policies in India: 10 Best Practices for Employers

FAQs: Understanding POSH Act Compliance in India

What are the key steps mandated by the POSH Act to ensure compliance with sexual harassment prevention in the workplace?

The POSH Act mandates organizations in India to take specific steps for ensuring compliance. These steps encompass various aspects of preventing and addressing sexual harassment in the workplace.

Step 1: Drafting a ‘Prevention of Sexual Harassment’ policy

Organizations are required to formulate a POSH policy. This policy outlines the organization’s commitment to preventing sexual harassment, the processes for reporting complaints, and the procedures for investigation and resolution.

Step 2: Updating employment contracts

Employment contracts should be updated to include provisions related to the organization’s POSH policy. These provisions should detail the commitment to maintaining a harassment-free workplace and the consequences for violating the policy.

Step 3: Forming an internal committee  

Organizations are mandated to establish an internal committee. This committee is responsible for receiving and addressing complaints related to sexual harassment. The committee should consist of designated members, including a presiding officer, who are trained in handling such cases.

Step 4: Employee awareness

Organizations are required to conduct awareness programs to educate employees about their rights and responsibilities concerning the prevention of sexual harassment. These programs should help employees understand how to report incidents and the available avenues for seeking redressal.

Read: What Constitutes Sexual Harassment?

Step 5: Annual report submission

Organizations must submit an annual report on their compliance with the POSH Act. This report provides information on the number of complaints received, resolved, and pending, as well as details about awareness programs conducted during the year. The report is submitted to the District Officer within the specified timeframe.

What are the key components of a POSH policy?

A comprehensive POSH policy should cover the following:

  • Clear objectives and purposes of the policy
  • Definition of sexual harassment
  • Coverage details, specifying who and where the policy applies
  • Employee responsibilities, including do’s and don’ts
  • Internal committee details and procedures
  • Complaint filing process
  • Complaint handling and investigation procedures
  • Disciplinary measures and penalties
  • Appeal procedures and compensation for complainants
  • Privacy and confidentiality clauses

How should employment contracts reflect the POSH policy?

Employment contracts should emphasize the organization’s commitment to providing a safe workplace and outline the consequences for violating the POSH policy.

What is the purpose of an internal complaints committee?

The internal complaints committee (ICC) is a judicial body formed within organizations with 10 or more employees to address and resolve sexual harassment complaints. It ensures a fair, transparent, and unbiased inquiry process.

The committee’s responsibilities include drafting the Sexual Harassment Policy, providing a safe environment, organizing awareness programs, handling complaints, and ensuring appropriate compensation.

Who are the members of the internal committee?

The internal committee comprises three types of members:

  • Presiding officer: A senior-level female employee serving as the chairperson.
  • Employee members: Two or more employees, preferably with legal or social work expertise.
  • External member: An unbiased external individual familiar with sexual harassment issues.

What role does the external member play?

The external member ensures unbiased internal committee activities, transparency, and neutrality. They contribute to policy formulation, handle complaints impartially, provide professional advice, and assist in annual report preparation.

Can the external member charge for their services?

Yes, the external member is entitled to an allowance and travel cost reimbursement. They can serve multiple organizations.

Should all internal committee members be women?

At least half of the internal committee members must be women, including the presiding officer.

What are the consequences of not forming an internal complaints committee?

Failure to properly form the internal committee can lead to legal implications, including dissolution of the committee, fresh inquiries, and penalties up to INR 50,000. Repeat offenses can result in double penalties or license cancellation.

Why is filing an annual report important under the POSH Act?

Filing an annual report is a mandatory requirement under the POSH Act. It demonstrates an organization’s commitment to preventing sexual harassment and provides transparency about the number of cases filed, completed, and under investigation.

What are the annual reporting requirements under the POSH Act?

Section 21 of the POSH Act establishes that the Internal Complaints Committee is required to submit an annual report each calendar year to both the employer and the district officer. The annual report, as outlined by the provisions within the POSH Law, must include the following components:

  • The total number of sexual harassment complaints received during the year.
  • The total number of sexual harassment complaints that were resolved or disposed of during the year.
  • The count of sexual harassment cases that remained pending for a period exceeding 90 days.
  • Information about any workshops or awareness programs organized by the employer to sensitize employees about the provisions of the POSH Law.
  • Details regarding the actions taken by both the employer and the district officer in response to sexual harassment complaints.

While the POSH Law stipulates the elements to be incorporated into the annual report, it does not specify a particular timeframe for the submission of the annual report.

The specific dates for filing this annual report vary between Indian states, falling anywhere between December 31 and January 31. Each state notifies the relevant district authority through an official notification, specifying the designated authority to which the report should be submitted and the deadline for submission.

Do all members of the internal complaints committee need to sign the annual report?

Ideally, it is advisable for all members of the ICC committee to sign the annual report. However, there is flexibility in the process. The annual report can also be signed by the presiding officer of the ICC committee on behalf of all committee members. In such a case, it’s important to ensure that there is documented confirmation from all the ICC committee members indicating their agreement with the contents of the report. This confirmation can be obtained through written communication or email.

Since the preparation of the annual report is a collective responsibility of all internal complaints committee members, it’s crucial to ensure that all members are in agreement with the report’s contents before it is submitted. This ensures transparency and accountability in the reporting process. Whether all members physically sign the report or the presiding officer signs on their behalf, it’s essential to maintain a record of the confirmation from all members to validate their participation in the report preparation.

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