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Section 2 of THE SALES PROMOTION EMPLOYEES (CONDITIONS OF SERVICE) ACT, 1976

In this Act, unless the context otherwise requires,—

(a)“establishment” means an establishment engaged in pharmaceutical industry or in any notified industry;
(b)“notified industry” means an industry declared as such under section 3;
(c)“prescribed” means prescribed by rules made under this Act; 2[(d) “sales promotion employees” means any person by whatever name called (including an apprentice) employed or engaged in any establishment for hire or reward to do any work relating to promotion of sales or business, or both, but does not include any such person—
1. (i)who, being employed or engaged in a supervisory capacity, draws wages exceeding sixteen hundred rupees per mensem; or
2. (ii)who is employed or engaged mainly in a managerial or administrative capacity. Explanation.—For the purposes of this clause, the wages per mensem of a person shall be deemed to be the amount equal to thirty times his total wages (whether or not including, or comprising only of, commission) in respect of the continuous period of his service falling within the period of twelve months immediately preceding the date with reference to which the calculation is to be made, divided by the number of days comprising that period of service;]
(e)all words and expressions used but not defined in this Act and defined in the Industrial Disputes Act, 1947 (14 of 1947), shall have the meanings respectively assigned to them in that Act.

Summary

The single most important thing this section does is define key terms used throughout the law, especially who qualifies as a sales promotion employee.
It defines an establishment as a business in the pharmaceutical industry or any other notified industry.
It excludes people from the definition of a sales promotion employee if they work in a supervisory capacity and earn more than sixteen hundred rupees per month.
It also excludes people who are employed mainly in a managerial or administrative capacity.
It provides a specific mathematical formula for calculating a person's monthly wages based on thirty times their total wages divided by their days of service.
Any words not defined here will carry the meanings given to them in the Industrial Disputes Act of 1947.

Practical examples

1Rahul is hired by a pharma company to promote a new heart medication to doctors. Because his primary job is promoting sales, he qualifies as a sales promotion employee under this definition.

2Priya is a Regional Sales Manager at a notified cosmetics firm. Her role is primarily managerial, overseeing a team of fifty people, so she does not qualify as a sales promotion employee under this section.

3Amit is a sales supervisor making 1,800 rupees a month. Because he is a supervisor making more than 1,600 rupees a month, he is excluded from the protections of this law.

FAQ

1. How are monthly wages calculated under Section 2 of the 1976 Act?

Section 2 of the 1976 Act calculates monthly wages by taking thirty times the total wages earned over the previous twelve months, divided by the number of days of service.

2. What happens if a word is used in the sales promotion law but not defined in Section 2?

According to Section 2 of the sales promotion law, any undefined words will have the meanings assigned to them in the Industrial Disputes Act of 1947.

3. Does Section 2 of the Sales Promotion Employees Act cover apprentices?

Yes, Section 2 of the Sales Promotion Employees Act explicitly states that the definition of a sales promotion employee includes an apprentice.

Test yourself

Q1.Under Section 2 of the Sales Promotion Employees (Conditions of Service) Act, 1976, which of the following individuals is excluded from being a sales promotion employee?

Q2.Section 2 of the 1976 Act defines a "notified industry" by referring to a declaration made under which other section of the law?

Q3.According to the explanation in Section 2 of the sales promotion law, how many days are used as the multiplier when calculating deemed wages per mensem?

Q4.If a legal dispute arises involving a term not defined in Section 2 of the Sales Promotion Employees Act, which existing law provides the definition?

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