The Government of Gujarat has introduced significant reforms through the Gujarat Shops and Establishments (Regulation of Employment and Conditions of Service) (Amendment) Ordinance, 2025, followed by the passage of the Amendment Bill, 2026 by the Gujarat Assembly. These changes aim to enhance operational flexibility for businesses while expanding employment opportunities, particularly for women.
The Governor of Gujarat promulgated the Amendment Ordinance on 16 December 2025 and came into effect on the same date. Ordinances are temporary legislative measures issued when the State Legislature is not in session and must be replaced by a formal law within six weeks of the legislature’s reassembly. Accordingly, the Gujarat Assembly later approved the Amendment Bill, 2026, giving permanent legislative backing to the provisions introduced through the ordinance.
One of the most significant changes concerns the applicability of the Shops and Establishments Act. Earlier, the Act applied to establishments with 10 or more employees (and under certain interpretations, even fewer). Under the amendment, the Act will now apply only to establishments employing 20 or more employees, including both managerial and non-managerial staff.
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Establishments with fewer than 20 employees are now required only to inform the Inspector about their opening and closing hours, without having to comply with the remaining provisions of the Act. This change substantially reduces compliance burdens for small businesses.
Changes in Working Hours and Rest Intervals
The amendment increases the permissible maximum daily working hours from 9 to 10 hours, while retaining the weekly cap of 48 hours. To safeguard employee welfare, the law also revises rest interval norms. Employees may now work up to six continuous hours (earlier five hours) before being entitled to a mandatory break of at least 30 minutes.
Enhanced Overtime Limits
The law expands permissible overtime limits to provide greater flexibility to employers. The maximum overtime has been increased from 9 hours to 10 hours per day, and 125 hours to 144 hours per quarter.Any work beyond 10 hours in a day or 48 hours in a week must be compensated at twice the ordinary rate of wages, in line with overtime provisions.
Women Permitted to Work Night Shifts
A landmark feature of the amendment is the permission for women to work night shifts between 9:00 pm and 6:00 am, subject to their consent. This measure is positioned as a step towards gender equality and women’s economic empowerment.
However, employers engaging women in night shifts must comply with strict conditions, including Ensuring protection of dignity, honour, and safety.Preventing sexual harassment at the workplace ,providing essential facilities such as rest rooms, separate ladies’ toilets, and night crèches and Arranging safe transportation from the workplace to the employee’s residence, up to her doorstep
The State Government also retains the power to regulate or prohibit women’s night work in specific areas or establishments through notifications, if required in the public interest.
Key Implications and Challenges
Although the amendments promote ease of doing business and workforce flexibility, certain challenges remain. A 10-hour workday across five days would result in 50 working hours per week, exceeding the statutory limit of 48 hours and potentially triggering overtime obligations. Additionally, employers must align these changes with the Occupational Safety, Health and Working Conditions Code, 2020, which prescribes 8 hours as the normal working day for establishments with 10 or more non-managerial employees.
Another practical concern is the requirement of night crèche facilities, which may be difficult for employers relying on third-party service providers that operate only during standard business hours.
