IT Employees At SEZs, IT Parks Allowed Work From Home: New Rules Announced By Govt

Recently, new rules have been introduced regarding the ‘work from home’ under the existing SEZ Law of India and there has been a lot of buzz regarding the same.

This new rule is in context to the categories of employees (primarily covering employees of IT and ITeS SEZ Units, employees who are temporarily incapacitated, employees who are travelling and employees who are working offsite) who shall be permitted to work from home or any place outside the SEZ, subject to a limit of 50 per cent of the total employee strength.

Government has made amendments to the existing SEZ law by introducing a new rule on the work from home and in a move to revamp the existing SEZ Law, the new rule will address the following issues.

• This aims to address the issue of lobbying from concerned stakeholders in the interest of protecting their revenues
• To address the issue of dual employment by employees from the Labor Department

As most of the organisations are in the midst of a gradual phase of return to work on a hybrid model, this amendment is timely and most needed. 

The new rule is a bit burdensome due to the fact that it has various procedural and administrative compliances. 

There are lot of of grey areas existed around the process to be adopted for new employees joining, subsequent approval from Jurisdictional Specified Officer for removal of assets to employees working from home with the certification, etc.

SOP by Department of Commerce

An SOP has been provided by the Department of Commerce in regards to implementing the new rule:

• Permission only for identified 50% of Employees to work from home – As part of the application, names of all employees (to whom the work from home facility is provided by the SEZ Unit), subject to a limit of 50 per cent, needs to be submitted with the Development Commissioner of Jurisdictional SEZ Office. If only identified 50 per cent employees are provided with the benefit of work from home, there is a possibility of discrimination amongst the organization’s employees and a serious situation could arise. Such a requirement will take away the flexibility offered by Organisations to all its employees on work from home. Having represented the issue by various entities in their individual capacity to the SEZ Offices across India, varied views have emerged. Some benevolent Development Commissioners in certain States have agreed that there exists a genuine concern of the Units and have stated that they shall agree to accept list of 100 per cent of employees with a condition that at any point in time, 50 per cent WFH. Whereas, certain jurisdictions, have been outrightly rejected agreeing to such a plea of accepting 100% list of employees, thereby showing the differences in understanding each Development Commissioner had got in this regard.
•  Violation of condition – The rule also prescribes an outer boundary of 50 per cent of total employees who shall be permitted to work from home. This would mean 50 per cent employees shall have to work from office. The rule however, does not address if the said limit will fall below 50 per cent to work from office due to sudden illness of employees, or employees are travelling, or for any other reason, would that be literally considered a breach of condition, thereby deterring the subsequent renewal permissions from Development Commissioner.  
• Terms and Conditions – As part of the application, terms and conditions are required to be submitted to the SEZ Office for seeking approval for work from home. The rule does not explicitly clarify the requirements of these terms and conditions. The intent seems to ensure that every organisation allowing its employees to WFH has certain policies which may vary organisation to organization but are in alignment with standard requirements / practices.
• Maintenance of Attendance – Organisations opting for work from home benefit for its employees are required to maintain accurate attendance for entire period of permission. Here again there is no clarity as to whether the attendance would have to be maintained on a daily basis or any other periodicity.

If not for all, the SOP issued by Department of Commerce has sought to clarify many of the aforesaid concerns primarily on providing the benefit to all the employees.

• Instead of restricting the benefit to identified 50 per cent of employees, the SOP has clarified that the benefit can be extended to all the employees subject to restriction that 50 per cent should work from office at any given point of time.
• The SOP categorically states that discretion has been vested with Development Commissioners for approving more than 50 percentage of the employees to work from home, given the fact that many units are operating at close to 90 percentage work from home today and may require sufficient time to reduce this gradually in a manner that employees are not inconvenienced and work is not impacted, and such approval shall not be denied or revoked without giving due opportunity of being heard.
• The SOP has also sought to clarify that there is no requirement to submit the attendance record, however, unit to ensure that the same is maintained accurately which would be subject to verification by any officer authorized by Development Commissioner

Issuance of SOP

Issuance of SOP is a welcome step in bringing uniformity in approach by Development Commissioners across the nation. This would certainly bring relief to all those SEZ IT ITeS Organizations planning for hybrid model of work from home for all its employees. Having said, Organisations would have to think through implementable options to make the work from home model workable without impacting the business and at the same time without violating the provisions of the new rule, and should look for:

• Defining an appropriate hybrid model for work from home for all of the employees, while ensuring 50 percentage or more attendance in office at any given point of time. Model to take into consideration the contingencies of sickness leave, vacation, or any other reason that may come up in future
• Revisiting their work from home policy to align with the requirements under the new rule. Policy to consider aspects of login timings, reporting, connecting through VPN, process around repaired laptops, reimbursement of internet expenses, etc.
• Re-defining the policy around new joinees who would be provided with the benefit of work from home from day one.
• Strengthening the operational requirements of digitizing the records namely attendance Register, asset Register, bond Register, amongst others. Organisations would also need to also focus on tracking the issuance of valid identity cards having SEZ hologram.