The Sexual Harassment of Women at Workplace Act 2013 has been in force for over a decade. Yet in Vilot's experience across hundreds of business engagements, the majority of Indian companies — including well-funded startups and established MSMEs — have POSH compliance structures that would not survive a regulatory inspection or a formal complaint. Here are the five mistakes we see most often.
Mistake 1: Not constituting the ICC at all
Any employer with 10 or more employees is legally required to constitute an Internal Complaints Committee. The threshold is low deliberately. A startup that crossed 10 employees last quarter and still has no ICC is already in criminal default. Penalty: up to ₹50,000 for first offence; cancellation of business licence for repeat. Many founders believe the ICC is only relevant when a complaint is made. This is wrong — the obligation to constitute the committee exists independently of whether any complaint has ever been filed.
Mistake 2: Wrong ICC composition
The POSH Act mandates a specific composition for the ICC: a Presiding Officer who is a senior female employee; at least two members from among employees committed to the cause of women or with legal knowledge or social work experience; and an external member from an NGO or association committed to the cause of women. Many companies constitute committees with only internal members, or appoint a junior employee as Presiding Officer, or omit the external member entirely. A non-compliant ICC composition invalidates the committee's authority to hear complaints.
Mistake 3: Policy on paper only
Having a POSH policy document is not the same as POSH compliance. The Act requires that the policy be communicated to all employees, displayed at the workplace, included in the employee handbook, and incorporated into employment contracts. Companies that drafted a policy in Year 1 and then filed it away — without employee training, contract integration or annual review — are not compliant, regardless of what the document says.
Mistake 4: No annual report
The POSH Act requires every employer to submit an annual report to the district officer covering: number of complaints received, number disposed of, number of cases pending. This report is mandatory regardless of whether any complaints were received. Most companies are unaware of this obligation and have never filed it. This is a standalone statutory default, separate from any complaint-related non-compliance.
Mistake 5: Forgetting remote and contractual workers
Post-pandemic, many Indian businesses operate with fully or partially remote teams. The POSH Act's protections extend to any conduct in connection with work — including virtual meetings, work messaging, off-site interactions and contractual workers. A company whose POSH policy only references the physical office and permanent employees has a gap that a complainant's advocate will exploit immediately.