“Employer” under The POSH Act: The Jurisdictional Debate between The Internal Committee & Local Committee

Recently, the Supreme Court in its decision dated May 12, 2023 in the case of Aureliano Fernandes v The State of Goa and Others observed in the context of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act) that as salutary as the enactment is intended to be, it will never succeed in providing dignity and respect that women deserve at the workplace unless and until there is strict adherence to the enforcement regime and a proactive approach is adopted by all the State and non-State actors. In this context, the Supreme Court went on to pass various directions to various public stakeholders to, inter alia, strictly implement/ ensure the implementation of the provisions of the POSH Act in India.

The scheme of the POSH Act provides for the constitution of two forums where an aggrieved woman can raise her complaint of sexual harassment. The first is an Internal Committee which is mandatorily required to be constituted by every employer of a workplace where more than ten workers are employed. The second is the Local Committee constituted by the District Officer under Section 6 of the POSH Act- (a) to receive complaints if an Internal Committee has not been constituted due to having less than ten workers or (b) if the complaint is against the employer himself.

Keeping with the spirit of implementation, the present article aims to examine the scope of who can be considered an “employer” under the POSH Act. The answer to this question has a direct implication on the jurisdiction of the Internal Committee and as a result, a discernible impact on the effective implementation of the POSH Act in the private sector.

Section 2(g) of the POSH Act defines “employer” in relation to any department, office, branch, or unit of the appropriate Government or a local authority, as the head of that department, organisation, undertaking, establishment, enterprise, institution, office, branch or unit or such other officer as the appropriate Government or the local authority may specify. On the other hand, in a non-governmental setup, “employer” means any person responsible for the management, supervision, and control of the workplace, where “management” includes the person or board or committee responsible for the formulation and administration of policies for such an organisation. Section 2(f) defines “employee” to mean a person employed at a workplace for any work on a regular, temporary, ad hoc, or daily wage basis, either directly or through an agent such as a contractor, with or, without the knowledge of the principal employer, whether for remuneration or not and includes a co-worker, a contract worker, probationer, trainee, apprentice or called by any other such name.

In practice, a large number of complaints of sexual harassment under the POSH Act are raised by women against senior officials at their workplace. A possible corollary to this is the lack of jurisdiction of the Internal Committee to inquire into the complaint if such a senior official is considered an “employer” under the POSH Act. A perusal of the above definition of “employer” illustrates that a person who could be considered an “employer” is more specific and restricted in the case of government institutions and more abstract in the case of private sector entities. Consequently, the definition of “employee” and “employer” under the POSH Act are not mutually exclusive. Some posts or designations may fall under both definitions, and the same person may be both an ”employer” and an “employee” depending on the circumstance, which may result in uncertainty while implementing the provisions of the POSH Act. On the other hand, conferring an overly expansive interpretation of the term “employer” in the case of non-government entities will result in rendering the Internal Committee constituted by such an organisation redundant, and therefore, the issue requires deeper consideration.

In practice, an unfortunate emerging trend is one where a dissatisfied party to the complaint being inquired into by an Internal Committee, having gauged that their chances of either proving their complaint or defending themselves against a complaint, as the case may be, are dim, are likely to insist on adjudication by a Local Committee instead. In such cases, typically, a stand is taken that the accused would fall under the ambit of “employer” under the POSH Act, and therefore it is the Local Committee (and not the Internal Committee) that would have jurisdiction. This places an additional burden on an establishment to first justify the autonomy and independence of its Internal Committee so as to avoid the misuse of the above provisions of law relating to complaints filed against an “employer”. In this background, it is important that fair, transparent, and effective inquiries are conducted by the Internal Committee to weed out frivolous claims as to the Internal Committee’s lack of jurisdiction.

The question of whether an accused person should be considered an “employer” under the POSH Act has been considered by various courts on a case-to-case basis. For instance, in the case of Jaya Kodate v Rashtrasant Tukdoji Maharaj Nagpur University and Others, complaints of sexual harassment were filed by professors/ teachers at a college against their seniors who included the President, Secretary of the Society overlooking administration of the college and Principal of the College. It was argued by the Respondents that the Head of the Department, Principal, Secretary, or President of the society would be considered “employer” under the POSH Act and hence, a complaint against them must be made to Local Committee under Section 6(1) of the POSH Act. The Court, while acknowledging the overlap between “employer” and “employee” under the POSH Act observed that “employer” appears to be a very small field and all those working in various capacities either managerial, administrative, or supervisory, whether they derive some benefit or work even voluntarily, if are answerable for any lapse or wrong on their part to the management, will be covered under the phrase “employee”. The court observed that the concept of “employee” and “employer” under the POSH Act must be understood in a way conducive to further the object of enactment and unless otherwise necessitated, in favour of an aggrieved woman. Accordingly, in view of the fact that all accused/ respondents had superiors to whom they were answerable, the court deemed it appropriate to consider them “employees” under the POSH Act over whom the Internal Committee would have jurisdiction.

The Bombay High Court, in the case of Dr David G. Samuel v Collector/District Magistrate, Pune, and Others, also adopted a similar stance as in the case of Jaya Kodate (supra). In the said case, a complaint had been filed against the President of the Governing Board of Trustees of the Union Biblical Seminary (UBS) before the Internal Committee by an employee of UBS. The accused contended that he was the “employer” as defined under the POSH Act and therefore, the Internal Committee would not have jurisdiction over the complaint. The accused also raised several such objections before the Internal Committee. The Internal Committee, having considered such objections, proceeded with the inquiry and found against the accused. The court observed that the business affairs of the society are carried on and managed by the Governing Board, which is responsible for the governance of its institution and no individual was solely responsible for the governance of the institution. Accordingly, the court confirmed that the Internal Committee had jurisdiction to hear the matter. In holding this, the Court opined that the objective of the POSH Act is not to protect the person accused of harassment but to ensure that the person who is “the employer” does not influence the Internal Committee so as render the inquiry meaningless.

The Calcutta High Court, in the case of Banani Chattopadhyay v Union of India and Others, adopted a similar view in a complaint filed by a Deputy Manager against the accused/ respondent who was the Chairman-cum-Managing Director of the company. The Court observed that the accused was answerable to the Board of Directors, and hence, the Board being the ultimate authority is the “employer” under the POSH Act and not the accused/ respondent.

On the other hand, a more expansive and liberal interpretation has been accorded to the term “employer” by the Delhi High Court in the case of A v B. and Others [Writ Petition (Civil) 1103 of 2020]. The court found that the accused who held the post of a secretary of the institution in question and was, in practice, responsible for managing day-to-day affairs of the office where the aggrieved woman was engaged, and thus, would be the “employer” under Section 2(g) of the POSH Act. 

The general judicial trend, therefore, has been to presume in favour of the jurisdiction of the Internal Committee unless proven otherwise, in line with the scheme of the POSH Act.

The stance adopted by courts in most cases dealing with the issue of the jurisdiction of the Internal Committee in view of the definition of “employer” has not favoured the overriding, replacement, or doing away with the Internal Committee. The courts have time and again acknowledged that the scheme of the POSH Act is the appointment of an Internal Committee, which is more accessible to an aggrieved woman at her workplace, and that the Local Committee should be approached only when there is no alternative, as prescribed under the POSH Act.

In our view, various objective tests may be applied for seeking clarity in a conflicting situation. For example, if the Internal Committee has been appointed by the accused person and all members of the committee (barring the external member) are hierarchically subordinate/ reporting or answerable to the accused person, such a person may be regarded as an ‘employer’. Conversely, if an unbiased Internal Committee can exist/ be constituted without the involvement or control of the accused person, the accused person should be considered an “employee” under the POSH Act irrespective of his designation or role, or responsibilities, and therefore be subject to the jurisdiction of the Internal Committee, resulting in the effective implementation of the decade-old, constantly- evolving statute.

While the courts are yet to develop a broader standardised test for the determination of whether an accused person is an “employer” under the POSH Act, cases of this nature will always require consideration on an individual basis. A suggested practical indicator, in our view, could be to verify whether the person in consideration has the power of appointing the Internal Committee under the POSH Act, or in other words, has the power to impinge upon the ability of an Internal Committee to act in an independent and unbiased manner to inquire into the complaint presented before it. Adopting such an approach will help to avoid a scenario where every departmental head or manager is considered an “employer” under the POSH Act and preserve the sanctity of the scheme of the POSH Act in its effective implementation in line with the recent directions of the Hon’ble Supreme Court.

Jeevan Ballav Panda is a Partner, Shalini Sati Prasad is a Principal Associate and Meher Tandon is a Senior Associate at Khaitan & Co.