1. Background & Legal Context
The Government of Andhra Pradesh has
published the Draft Code on Social Security (Andhra Pradesh) Rules, 2026 via
G.O.Rt.No.43 dated 23.02.2026 from the Labour, Factories, Boilers &
Insurance Medical Services (Lab.II) Department.
These draft rules are issued:
- Under powers in sections 154 and 156 of the Code on Social
Security, 2020 (Central Act 36 of 2020)
- In view of:
They supersede earlier State rules
under:
- Employees’ Compensation Act, 1923
- Maternity Benefit Act, 1961
- Payment of Gratuity Act, 1972
- Unorganised Workers’ Social Security Act, 2008
The draft is open for objections &
suggestions for 45 days from the date the Gazette copy is made available to the
public. Submissions can be made online:
2. Scope & Key Definitions
2.1 Short Title & Commencement
- Called “The Code on Social Security (Andhra Pradesh) Rules,
2026”.
- Will come into force from the date of publication in the
Official Gazette.
2.2 Important Definitions for HR
Some key defined terms that matter for
HR & Compliance:
- “Assessing Officer” – Gazetted officer appointed by State
Government for assessment of building & construction cess.
- “Cess collector” – Officer appointed to collect cess under
Chapter VIII of the Code.
- “Competent authority” – Authority appointed under section 91
(Employees’ Compensation) and section 56 (Gratuity disputes).
- “Inspector-cum-Facilitator” – Appointed under section 122;
responsible for inspection and guidance.
- “Career centre (regional)” – State‑notified career/employment
centre for vacancy reporting, returns etc.
- “Fund” – AP Building & Other Construction Workers Welfare
Fund or Social Security Fund under section 141.
- “Register of women employees” – Specific register in Form XX.
Implication: HR teams must be familiar with these authorities and forms—they are
the key contact points for disputes, registration, cess, maternity, gratuity
etc.
3. Digital Registration &
Cancellation of Establishments (Rule 3)
3.1 New Registration Process
Every unregistered establishment
must:
- Apply electronically using Form-I of the Occupational Safety,
Health & Working Conditions (AP) Rules, 2026 via the State Labour Dept
portal.
- Use this common form for registration under multiple labour
codes.
- Provide:
- Establishment details
- Employer identity & address proofs
- PAN / other unique IDs, which may be verified online.
Timeline & Deeming Provision
- Registration certificate must be issued immediately, and in any
case within 7 days of submission of complete application.
- If not issued within 7 days, registration is deemed granted and
a certificate shall be auto‑generated.
Exceptional Situations
- State Government may temporarily dispense with electronic
registration (e.g., certain classes/areas) and allow physical submission,
via notification.
3.2 For Establishments Already
Registered under Other Labour Laws
- Employers must update particulars on the State Labour portal
within the period specified by a government notification.
3.3 Expiry of Registration
- A registration expires automatically if no compliance is
reported for 24 months using that registration number.
- It can be revived upon application on the portal.
3.4 Cancellation of Registration
- If registration obtained by wrong information, it may be
cancelled after:
3.5 Employer Obligations
- Quote registration number on all documents & correspondence
under the Code, schemes, rules and regulations.
- Update any change in particulars on the portal within 30 days.
- For closure: apply for cancellation of registration online with
complete details and status of all contributions & dues.
4. Unorganised Workers Social Security
& BOCW Welfare (Rules 4–12)
4.1 Andhra Pradesh Unorganised Workers
Social Security Board (Rule 4–8)
Tenure & Limit on Terms
- 7 members from unorganised workers
- 7 from employers of unorganised workers
- 5 eminent persons (labour welfare, management, finance, law,
admin)
- 2 MLAs (nominated via Speaker)
- 10 from concerned departments
With mandatory representation (within
the 7 worker reps) for:
Vacancy, Resignation & Removal
- Members can resign by letter to State Government.
- Vacancies filled for the remainder of term through nomination.
- Members must abstain from meetings if removal proceedings are
pending; Government’s decision on disqualification/removal is final.
4.2 AP Building and Other Construction
Workers Welfare Board (Rules 9–10)
The Board must formulate schemes to:
- Pay premiums for Group Insurance for beneficiaries.
- Provide educational schemes for children of beneficiaries.
- Support medical expenses for treatment of major ailments of
beneficiaries or dependents.
Central Government may also formulate
additional welfare schemes for building workers in a State if required.
4.3 Governance: Meetings, Quorum,
Allowances (Rule 11–12)
- Minimum 3 meetings per year for both the Unorganised Workers
Board and BOCW Board.
- 15 days’ notice for ordinary meetings (with agenda & brief
notes); shorter notice allowed for emergency meetings.
- Quorum:
- Provision to appoint substitutes to attend meetings on behalf
of members, subject to:
- Written authority
- Approval by Chairperson
- Member remains liable for any misappropriation or
misapplication by substitute.
- Minutes to be circulated within 4 weeks and confirmed in next
meeting.
- Non‑official members entitled to TA/DA at State Government
officer rates; MLAs as per MLA rules; Ministers as per their own service
rules.
5. Employees’ State Insurance Society
(Rule 13–16)
5.1 Creation of State ESIS Society
State Government may establish an
Employees’ State Insurance Society as a managerial and healthcare body. It will
have:
- Governing Body
- Executive Committee
- Chief Executive Officer
- Secretariat
Society to be registered under
applicable State Societies Registration Act & Public Trust Act.
5.2 Governing Body Composition
- Chief Secretary – Chairperson
- ACS/Principal Secretary/Secretary (Labour/Health) – Vice‑Chairperson
- ACS/Principal Secretary/Secretary (Health/Labour) – Member
- ACS/Principal Secretary/Secretary (Finance) – Member
- Director, ESIS – CEO‑cum‑Member Secretary
- ESIC nominees
- 3 Employers’ reps
- 3 Employees’ reps
- Regional Director, ESIC
- State Medical Officer, ESIC
5.3 Executive Committee & Meetings
- Executive Committee chaired by ACS/Principal
Secretary/Secretary overseeing ESIS.
- Quorum: 1/3 or at least 3 of filled posts.
- Governing Body: meets at least twice a year.
- Executive Committee: at least quarterly.
5.4 Budgeting & Accounts
- Budget to be submitted by 10th December every year.
- Accounts audited by CAG annually.
- Financial year: 1 April – 31 March.
- Financial statements to be ready by 31 May, and annual report +
accounts to ESIC within 6 months of year‑end.
5.5 Other Key Points
- Society may sue or be sued through CEO or appointed member.
- Employees will be on deemed deputation from
Govt/PSU/ESIC with pension liabilities resting with parent organisation.
6. Gratuity – Detailed Operational Rules
(Rules 17–21 + Forms I–VII)
6.1 Gratuity for Minors (Rule 17)
Where gratuity is payable to a minor
nominee or heir, the Competent Authority must invest the amount in a term
deposit with SBI or any nationalised bank until the minor attains majority.
6.2 Nomination (Rule 18, Form I)
- Nomination must be given in Form I, in duplicate, within 90
days:
- Existing employees (1+ year service) – within 90 days of
commencement of rules.
- New employees – within 90 days of completing 1 year.
- Employer must:
- Verify service particulars
- Return one attested copy to employee within 30 days
- Retain the other. citeturn3search1
- If employee has no family at nomination time, a fresh
nomination is mandatory within 90 days of acquiring family status.
- Modifications in nomination (e.g., nominee predeceases
employee) also through Form I.
- Nominations take effect from date of receipt by employer.
6.3 Claiming Gratuity (Rule 19, Forms
II–VII)
Application by Employee / Nominee /
Legal Heir
- Employee: within 30 days of gratuity becoming payable (can
apply 30 days before known superannuation/retirement date).
- Fixed‑term employees: eligible if they complete 1 year; period
> 6 months is rounded off to 1 full year.
- Nominee: within 30 days of gratuity becoming payable.
- Legal heir: within 1 year.
- Delayed applications must be accepted if sufficient cause is
shown; delay alone cannot render claim invalid.
Employer’s Decision & Timelines
Within 15 days of application:
- If admissible → issue Form III
specifying amount & payment date (within 30 days of application).
- If not admissible →
issue Form III with reasons and copy to Competent Authority.
Gratuity must be paid via Demand Draft
or bank transfer.
Disputes & Appeals
- If employer:
- Refuses nomination,
- Disagrees with amount, or
- Fails to issue notice in time,→ Employee/nominee/legal heir may apply to Competent Authority in Form IV within 180 days (extendable).
- Competent Authority:
- Issues notice in Form V to both parties, conducts hearing, may
summon witnesses, and records findings.
- If gratuity is payable, issues Form VI to employer directing
payment within 30 days.
- Appeal:
- To Appellate Authority within prescribed time, attaching
Competent Authority’s order.
- Appellate Authority decision communicated to both parties;
Competent Authority modifies its direction accordingly and may issue
revised Form VI with modified amount and 15‑day payment timeline.
- If employer still doesn’t pay, employee/nominee/legal heir may
seek recovery through Form VII, which allows recovery under section 129.
6.4 Management of Gratuity Trust (Rule
20)
For exempted establishments with
approved Gratuity Fund (Section 57(2)):
- Board of Trustees must be formed with equal representation of
employers & employees.
- Employer serves as Chairperson but must maintain arm’s length
in decisions.
- Board meets at least once every three months.
- Governance conditions (tenure, elections, quorum, records,
etc.) shall be as per the approved Gratuity Fund.
Any interpretation disputes under this
rule are to be referred to Government/Commissioner of Labour; their
interpretation is binding.
7. Maternity Benefit – Detailed
Provisions (Rules 22–27 + Forms VIII–XII, XX)
7.1 Medical Certificates & Proofs
(Rule 22, Form VIII)
Pregnancy, delivery, miscarriage, MTP,
tubectomy and related illness can be certified by:
- Registered Medical Practitioner
- Accredited Social Health Activist (ASHA)
- Auxiliary Nurse Midwife (ANM)
Additional acceptable documents include:
- Birth certificate from municipality/gram panchayat
- Extract from birth/death register
- Certificate by Gram Pradhan / Village Administrative Officer /
Municipal Officer, etc.
7.2 Claim Notice & Payment (Form IX)
- Woman must give notice for maternity benefit in Form IX,
including nominee details under section 62.
- Employer must:
- Pay maternity benefit & other amounts to the woman, or if
she dies, to her nominee/legal representative.
- Deposit payment with Competent Authority within 2 months of
death if there is doubt about rightful payee.
- Medical bonus to be paid with the second instalment of
maternity benefit.
- Wages under section 65 (miscarriage/illness etc.) to be paid
within 48 hours of producing Form X.
7.3 Nursing Breaks (Rule 23)
- Two breaks of 15 minutes each for nursing up to child’s age of
15 months.
- Extra travel time of up to 15 minutes to/from creche or place
where child is left.
- Any dispute over extra time → to
Competent Authority.
7.4 Creche Facilities (Rule 24)
Mandatory for establishments with 50+
employees:
- To provide and maintain a creche for children under 6 years.
- Within 1 km of establishment; relaxation allowed for industrial
parks/areas with common creche.
- At least 10 sq. ft per child; safe, rainproof building, fenced
play area, proper hygiene.
- Working hours aligned with employee shift patterns.
- Staffed by a woman with midwifery/creche training + 1 ayah per
10 children.
- Must provide cots, beds, sheets, blankets, toys, first-aid,
kitchen, milk, refreshments, toilets, wash basins, etc.
Creche Allowance (Instead of Physical
Creche)
- Where there is a sole negotiating union / council, it may agree
with employer to give creche allowance instead of on-site creche for
eligible employees (women, widowers, single parents with children < 6
years).
- Where no such union/council exists, majority of employees may
similarly agree.
- Amount not less than ₹500
per month per child, or higher as notified by Central Government;
applicable for up to 2 children (with exception for multiple births in
second childbirth).
7.5 Gross Misconduct & Appeals (Rule
25)
Acts constituting “gross misconduct”
(relevant for deprivation of maternity benefit under Section 68):
- Wilful destruction of employer’s property
- Assault on superior/co‑worker at workplace
- Criminal offence involving moral turpitude with conviction
- Theft/fraud/dishonesty related to employer’s business or
property
- Wilful non‑observance of safety measures / interference with
safety devices or fire‑fighting equipment
Appeal against deprivation of maternity
benefit to Competent Authority in Form X.
7.6 Complaints & Duties of Inspector‑cum‑Facilitator
(Rules 26–27)
- Complaints regarding withheld benefits or wrongful dismissal:
to Inspector‑cum‑Facilitator in Form XI.
- Inspector must:
- Appeals against Inspector’s decision go to Competent Authority
(also Form XI).
- Inspector must check compliance with key provisions: sections
59, 62(5),(6), 64–67, 69, 71 and previous irregularities.
Register of Women Employees (Form XX)
Employers must maintain detailed
Register of Women Employees capturing: appointment, leave, notices, proofs,
payments of maternity benefit, bonus, leave wages, nominee details, etc.
8. Records, Registers & Unified
Annual Return (Rule 28, Form XIII)
8.1 Registers to Maintain
- Register of employees – Form I of AP Code on Wages Rules, 2026
- Attendance / muster – Form IX of AP Code on Wages Rules, 2026
- Wages/overtime/advances/fines/deductions – Form IV of AP Code
on Wages Rules, 2026
- Register of women employees – Form XX under these rules
Registers may be electronic or physical,
in English + Hindi or local majority language, and must be kept updated.
- Preserve all registers for 5 calendar years from last entry.
- Produce them on demand to Inspector‑cum‑Facilitator.
8.2 Unified Annual Return – Form XIII
- Employers to file Unified Annual Return (online) in Form XIII
on State portal by 1st February each year for the preceding year.
- In case of sale, abandonment or discontinuance of
establishment:
The return consolidates requirements
under Wages, OSH, IR & Social Security Codes into a single integrated
filing.
9. Offences & Compounding (Rule 29,
Form XIV)
- State Government may authorise a Compounding Officer to handle
offences under section 138.
- Compounding process:
- Compounding notice in Form XIV (Part I) issued electronically.
- Employer has 15 days to pay composition amount and submit Part
III.
- If paid → Compounding Officer
issues Composition Certificate (Part IV) within 10 days.
- If not paid → Prosecution will be
initiated for the offence mentioned in the notice.
10. Employment Information &
Monitoring (Rules 32–33, 68–70)
10.1 Career Centres (Rule 32)
- State Government may establish or notify career centres or
convert existing employment exchanges into career centres; may also
partner with institutions, local bodies, or private bodies.
- Functions:
10.2 Reporting of Vacancies (Rule 33,
Form XV)
Public Sector:
Private Sector:
- Private establishments (or specific classes) will report from
date notified by State Government.
- Use Form XV, via writing/email/digital mode.
- To regional Career Centre at least 15 days before last date for
applications.
- For all‑India or multi‑State recruitment → also report to Central career centre / digital portal.
- Career Centre must allot unique vacancy ID and inform employer
within 3 working days (or up to 7 days for NE States).
10.3 Employment Information Return –
Form XVII
- Employer to file Form XVII (EIR) within 30 days of end of
financial year with Regional Career Centre.
- EIR includes:
- Total manpower (including contractual, outsourced)
- Vacancies occurred, reported & filled
- Manpower shortages and skill gaps
- Estimated manpower requirements for next year
11. Employees’ Compensation (Rules
34–48, Forms XVI–XIX)
- Interest on delayed compensation – 12% p.a. simple interest if
not paid within 30 days (or rate as notified by Central Government).
- Funeral expenses amount fixed at ₹20,000, subject to change by State notification.
- Claim applications to Competent Authority in Form XVI, can be
by post or electronically.
- Venue of proceedings: area where accident occurred / employee
(or dependants) reside / employer’s registered office.
- Transfer of records/money between Competent Authorities handled
through Forms XVIII & XIX and electronic/banking modes.
- Employer must inform each employee in writing and
electronically about their rights under Employee’s Compensation provisions
at the time of employment.
12. Exemptions – Eligibility Conditions
(Rule 49)
An establishment seeking exemption under
Section 143 must:
- Provide benefits substantially similar or superior to those
under:
- Chapter III schemes or
- Chapter IV benefits (as applicable).
- Apply electronically or otherwise as prescribed.
13. What HR & Employers in AP Should
Do Now
Here’s how you can translate the draft
into concrete internal steps:
- Registration & Portal Readiness
- Check if your establishment details on AP Labour Portal are
accurate and live.
- Map responsibility for timely returns & updates to
a specific HR/compliance owner.
- Gratuity & PF–Linked Practices
- Ensure Form I, II, III, IV–VII workflows for gratuity are
built into HRIS or manual SOPs.
- For any in‑house gratuity trust, review governance vs. Rule 20
and Board of Trustees structure.
- Maternity Policy & Creche
- Align your maternity policy, including:
- Eligibility checks
- Form VIII/IX usage
- Payment timelines
- Nursing breaks & creche/allowance.
- For 50+ employee locations, plan for on‑site creche or creche
allowance agreement as per Rule 24.
- Registers & Records
- Integrate Form XX (Register of Women Employees) and ensure
other registers/records are maintained for 5 years.
- Prepare to file Unified Annual Return – Form XIII online by
1st February each year.
- Vacancy Reporting & Employment Returns
- If you fall under public sector/ notified private category,
set a process for:
- Reporting vacancies in Form XV,
- Filing Form XVII yearly to Regional Career Centre.
- Safety & Compensation
- Inform all employees of their Employee’s Compensation rights
in writing and electronically at joining.
- Ensure compensation and funeral expense limits are understood by HR and line managers.
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