The POSH Threshold: Why "We're Too Small" Is Rarely the Right Answer
A question I hear constantly from early-stage founders: "We only have a handful of people — do we really need a POSH policy and an Internal Committee?" The honest answer, more often than not, is yes — and the miscalculation usually comes from counting the wrong headcount.
The 10-employee trigger
Under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, any organisation with 10 or more employees is required to constitute an Internal Committee (IC) and implement a POSH policy. Below that threshold, complaints go instead to the district-level Local Committee — but the obligation to have a policy and grievance mechanism doesn't disappear; it just routes differently.
Where founders under-count
The definition of "employee" under Section 2(f) of the Act is broader than most people assume. It expressly includes:
- Regular, temporary, and ad hoc employees
- Employees engaged through an agent or contractor
- Co-workers, probationers, and trainees
- Employees whether or not the terms of employment are express or implied
That last category — trainees — is the one I see missed most often. I've reviewed cases where a company counted only its 5 or 6 full-time employees and concluded the threshold didn't apply, while overlooking 15–20 trainees on its rolls. Once trainees are correctly counted as employees under the Act, the 10-person threshold is crossed well before the company expected it to be — and the obligation to form an IC becomes immediate, not optional.
What crossing the threshold actually requires
Once you're covered:
- A written POSH policy, communicated to all employees
- A constituted Internal Committee with a Presiding Officer (senior woman employee) and, notably, an external member from an NGO or with relevant expertise
- Regular sensitisation and awareness sessions
- Annual disclosure of the number of complaints received and their status in the Board's report (for companies) or as otherwise applicable
Practical takeaway
Don't run the headcount test on your permanent staff list alone. Pull the full universe — trainees, interns on stipend, contract staff, probationers — before concluding the Act doesn't apply to you. Getting this wrong isn't just a paperwork gap; non-constitution of an IC where required carries its own penal consequences under the Act, separate from any complaint that might arise.
If you're a growing team and unsure whether you've crossed the line, it's worth doing the count properly rather than assuming.
This post is for general informational purposes and does not constitute legal advice. For an applicability assessment specific to your organisation, consult a qualified professional.
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