The E. S.I. Act has been extended to shops by some of the Stales by invoking section 1(5) of the Act. Will an advertising agency be a 'shop' to attract the applicability of the Act?
Earlier some of the High Courts have' held that an advertising agency selling its experts' services to its clients to enable them to launch an effective advertising campaign of their products will not attract the applicability of the ESI Act but the Supreme Court reversed those decisions in holding that the ESI Act is a beneficial legislation hence the word 'shop' has to be construed in a liberal sense. Thus an advertising agency will attract the applicability of ESI Act.
Employees' State Insurance Corporation vs. R.K. Swamy & others, 1994 labour Law Reporter 51.
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