Telangana Expands Working Hour Flexibility for Commercial Establishments (Excluding Shops): A Shift Towards Business Ease 

Introduction 

In a significant regulatory development aimed at enhancing the Ease of Doing Business (EoDB) in the state, the Government of Telangana has issued G.O. Rt. No. 282 dated July 5, 2025, amending the working hour flexibility for commercial establishments (excluding shops) under the Telangana Shops and Establishments Act, 1988 (Act No. 20 of 1988). This move marks a progressive shift toward labour law flexibility, catering especially to the needs of service-oriented industries such as IT/ITeS, logistics, and back-office operations. 

Prior to this amendment, Sections 16 and 17 of the Telangana Shops and Establishments Act, 1988, imposed the following constraints: 

• Section 16: Capped the daily working hours for employees to 8 hours, with a provision for extra wages if the hours exceeded that limit. 
• Section 17: Mandated a weekly limit of 48 hours, with compulsory rest intervals and specific conditions for overtime, along with spread-over limits not exceeding 11 hours a day, including rest intervals. 

These provisions were designed to ensure worker welfare, but over time, they were increasingly viewed as rigid and out of sync with modern service-sector demands, particularly in 24/7 operations such as BPOs and IT-enabled services. 

The 2025 Reform: Key Changes Introduced by G.O. Rt. No. 282 

The latest Government Order, issued under the powers conferred by Section 73(4) of the Act, exempts all commercial establishments (excluding shops) from the applicability of Sections 16 and 17, subject to certain conditions. The key reforms include: 

• Extended Daily Working Hours: Employees may now work up to 10 hours per day, provided the weekly limit of 48 hours is maintained. 
• Rest Periods & Spread-Over: A minimum rest interval of 30 minutes is required after 6 hours of continuous work. 
• The total working period including rest intervals shall not exceed 12 hours a day. 
• Overtime Provisions: overtime is permitted beyond 48 hours per week, up to 144 hours per quarter. Overtime wages must be paid in accordance with applicable law. 
• Revocation Clause: If any of the stipulated conditions are violated, the exemption can be revoked by the Government without prior notice. 

Legal and Business Implications 

• Enhanced Flexibility for Employers: This reform grants employers greater autonomy in managing shifts, particularly for industries requiring extended or staggered operations. It aligns Telangana’s labour framework more closely with global business practices. 
• Clarity on Overtime Caps: Introducing a quarterly cap of 144 hours of overtime per employee ensures predictability for HR planning and safeguards against excessive labour exploitation. 
• Stricter Compliance Obligations: While the reform eases hour restrictions, it introduces strict conditionality, and any breach may result in an automatic revocation of the exemption. Employers must therefore maintain rigorous compliance systems to monitor hours and rest periods. 
• Worker Welfare Considerations: Though working hours are now more flexible, the preservation of: 
  – A 48-hour weekly cap, 
  – Mandatory rest intervals, and 
  – Overtime pay requirements ensures that employee rights are not diluted in the process. 

Comparison: Previous vs. Current Framework 

Strategic Considerations for Businesses 

• HR and Shift Planning: Companies must now revisit workforce policies, especially for backend operations, logistics, and customer support. 
• Record-Keeping: Payroll systems must be updated to track overtime accurately and generate evidence of compliance. 
• Employment Agreements: Employment contracts and internal HR manuals should be amended to reflect the new norms. 
• Training & Legal Awareness: Line managers and HR teams must be sensitized to these rules to prevent inadvertent violations. 

Conclusion 

This exemption notification underlines the Telangana Government’s proactive stance in reforming labour laws to make the state more industry-friendly, especially in light of the growing demand for round-the-clock operations. At the same time, the retention of essential worker protections such as rest intervals and overtime pay reflects a balanced regulatory approach. 

Employers operating in Telangana—particularly in IT/ITeS, logistics, healthcare, and BPO sectors—should treat this reform as an opportunity to improve operational efficiency while ensuring robust legal compliance.