The Assam Shops And Establishment (Amendment) Bill, 2026, which mandates that employees receive twice their regular wages for overtime work, calculated on a daily or weekly basis, whichever is more favourable, was passed by the Assam Assembly on July 28, 2026. The legislation aims to enhance employee welfare while simultaneously streamlining regulatory processes for commercial establishments in the state. This amendment is a significant development for Assam’s workforce, particularly those employed in shops and commercial establishments, as it directly impacts their earnings for extended work hours. The provision for double wages for overtime, calculated on the more beneficial of a daily or weekly basis, is expected to provide greater financial security and fair compensation to employees, aligning with broader national labour reform discussions.

What was announced

Labour Welfare Minister Rameswar Teli introduced The Assam Shops and Establishment (Amendment) Bill, 2026, in the Assam Assembly on July 9, 2026. The Bill was subsequently passed by the House on July 28, 2026. Minister Teli stated that the amendment seeks to reduce the compliance burden on commercial establishments and foster a business-friendly regulatory environment. He further explained that the legislation incorporates modern concepts such as digital governance, self-certification, deemed registration, and the promotion of round-the-clock economic activities. Crucially, the Minister affirmed that these changes would be implemented while retaining adequate safeguards related to employee welfare, working conditions, safety, overtime, and weekly holidays.

Why it matters

The new overtime provisions are a crucial step towards strengthening worker protections in Assam. By mandating double the rate of wages for overtime, the Bill ensures that employees are adequately compensated for working beyond standard hours. This measure is particularly beneficial for workers in the unorganised sector and Micro, Small, and Medium Enterprises (MSMEs), where fair compensation for overtime has historically been a concern. The “daily or weekly, whichever is more favorable” clause adds an extra layer of protection, ensuring that workers receive the maximum possible benefit depending on their work schedule. This move could also serve as a deterrent against excessive overtime demands from employers, encouraging better workforce management.

Background

Assam’s labour laws have undergone several revisions over the years, aiming to balance industrial growth with worker welfare. The original Assam Shops and Establishments Act, 1971, which came into force on September 4, 1974, regulated conditions of work and employment in shops and commercial establishments. This Act stipulated that no employee should work more than eight hours a day or 48 hours a week, with overtime capped at 50 hours per quarter and paid at twice the ordinary wage. More recently, The Assam Shops and Establishments Act, 2022, was implemented in 2025, bringing significant legislative overhaul after more than five decades. This 2022 Act aimed to align labour compliance with modern business practices, enhance employee welfare, digitise record-keeping, and standardise norms across various sectors. It also introduced provisions for overtime at double wages, capping it at 144 hours per quarter. The current 2026 amendment builds upon these reforms, specifically reinforcing the overtime compensation mechanism. The state government has also been actively working on improving the ease of doing business, introducing several bills alongside the Shops and Establishment amendment. These include The Assam Micro, Small and Medium Enterprises (Facilitation of Establishment and Operation) Bill, 2026, and The Assam Ease of Doing Business (Amendment) Bill, 2026, which aim to simplify regulatory procedures and reduce compliance burdens. In 2022, the Assam government also introduced 10 labour law amendment bills to decriminalise labour law violations by replacing imprisonment with higher fines, aiming to promote ease of doing business.

Key details

The Assam Shops And Establishment (Amendment) Bill, 2026, specifically mandates that employees engaged in overtime work must be compensated at twice the rate of their ordinary wages. This calculation will be performed on either a daily or weekly basis, with the provision ensuring that the method most favourable to the employee is applied. This approach aims to provide maximum financial benefit to workers who extend their working hours. The existing framework for overtime in Assam, as per the Shops and Establishments Act, generally limits daily work to eight hours and weekly work to 48 hours, with overtime generally capped at 50 hours per quarter, though some recent amendments have capped it at 144 hours per quarter.

Reactions

Labour Welfare Minister Rameswar Teli highlighted that the amendment aims to balance a business-friendly environment with robust employee safeguards. He emphasised that while the Bill promotes modern regulatory frameworks, it explicitly retains protections for employee welfare, working conditions, safety, overtime, and weekly holidays. The All India Trade Union Congress (AITUC) Assam State Committee has previously advocated for demands including an eight-hour workday and double overtime pay as per legal provisions, indicating a general support for such worker-centric reforms. General Secretary of AITUC Assam State Committee, Ramen Das, has previously stated that workers have legitimate demands for double overtime pay.

What’s next

Following its passage by the Assam Assembly on July 28, 2026, The Assam Shops And Establishment (Amendment) Bill, 2026, will now proceed for gubernatorial assent to become an Act. Once assented to and notified, the new overtime work provisions will come into force, impacting employees and commercial establishments across Assam. Businesses will need to update their payroll systems and work schedules to ensure compliance with the revised compensation structure for overtime work. The state government is expected to issue further rules and guidelines for the smooth implementation of the amended Act.

Sources & References

Source: Assam Shops And Establishment (Amendment) Bill, 2026 (Overtime Work Provisions) – Official URL