Labour Laws: Initiatives Taken For Ease Of Doing Business With Main Focus On ‘Shram Suvidha Portal’

A. Labour Laws in India:

The Ministry of Labour & Employment is one of the oldest and important Ministries of the Government of India. The main responsibility of the Ministry is to protect and safeguard the interests of workers in general and those who constitute the poor, deprived and disadvantage sections of the society, in particular, with due regard to creating a healthy work environment for higher production and productivity and to develop and coordinate vocational skill training and employment services. Government’s attention is also focused on promotion of welfare and providing social security to the labour force both in organized and unorganized sectors, in tandem with the process of liberalization. These objectives are sought to be achieved through enactment and implementation of various labour laws, which regulate the terms and conditions of service and employment of workers. The State Governments are also competent to enact legislations, as labour is a subject in the concurrent list under the Constitution of India.

At present, there are 44 labour related statutes enacted by the Central Government dealing with minimum wages, accidental and social security benefits, occupational safety and health, conditions of employment, disciplinary action, formation of trade unions, industrial relations, etc. Examples of such statutes are The Industrial Disputes (Central) Rules, 1957, The Trade Union Act, 1926 in the area of Industrial relations; Maternity Benefit Act, 1961, The Payment of Gratuity Act, 1972, The Employees Provident Fund & Miscellaneous Provisions Act, 1952, The Employees State Insurance Act, 1948 in the area of social security and so on.

The motive of the Central Government behind formulation of these statutes is to:

  • Improve the working conditions and the quality of life of workers through laying down and implementing policies / programmes / schemes / projects for providing social security and welfare measures
  • regulate conditions of work, occupational health and safety of workers
  • eliminate child labour from hazardous occupations and processes
  • strengthen enforcement of labour laws and promote skill development and employment services.

B. Shram Suvidha Portal: An initiative towards ease of doing business

Due to enforcement of 44 labour laws in their respective spheres by Ministry of Labour & Employment, Government of India and the State Governments enforce, there was complexity in compliances of all the applicable laws. There have been requests from various stakeholders for ensuring simplification of formats, ease of compliance, transparency in inspections and speedy redressal of grievances. In order to bring transparency and accountability in enforcement of labour laws and ease the complexity of compliance, Ministry of Labour & Employment catering to four major organisations under its aegis: Office of Chief Labour Commissioner (Central); Directorate General of Mines Safety; Employees’ Provident Fund Organization; and Employees’ State Insurance Corporation has developed a single unified Web Portal for Online Registration of units, Reporting of inspections and submissions of Annual Returns which is known as ‘Shram Suvidha Portal’ covering 16 Labour Laws. 

C. The objectives of Shram Suvidha web Portal

  • Consolidation of information of Labour Inspection and its enforcement. It leads to transparency and accountability in inspections.
  • The compliances are reportable in Single Harmonized Form which makes it simple and easy for those filing such forms.
  • The performance is monitored using key indicators thus making the evaluation process objective.
  • It promotes the use of a common Labour Identification Number (LIN) by all Implementing agencies. Labour Identification Number (LIN) is issued to replace all the employer codes being issued by separate labour enforcement agencies such as ESIC, EPFO, CLC(C) and DGMS etc.

D. Benefits of Shram Suvidha Portal

  • This portal facilitates ease of reporting at one place of various labour laws, consolidated information of Labour Inspection and its enforcement. It will enhance convenience of reporting, transparency in Labour Inspection and monitoring of Labour Inspections based on key performance indices.
  • This web portal provides for online reporting of harmonized inspection report by inspecting officials.
  • The web portal contributes proactively to achieve the objective of simplifying business regulations and bringing in transparency and accountability in labour inspections.

E. Main Features of Shram Suvidha Portal

  • Unique Labour Identification Number (LIN) allotted to Units facilitating online registration.
  • Filing of self-certified, simplified Single Online Return by industry. Units will only file a single consolidated Online Return, instead of separate Returns. Amendments to 10 Rules are already undertaken.
  • Transparent Labour Inspection Scheme via computerized system as per risk-based criteria and uploading of Inspection Reports within 72 hours by Labour Inspectors

F. Other Initiatives taken by the Ministry of Labour & Employment for Ease of Doing Business:

1. Common Registration Format on the e-biz Portal of DIPP:

Ministry has launched on 9th March 2016 the Common Registration Format on the e-biz Portal of DIPP, for registration under 5 Central Labour Laws viz.

2. Simplification/ Reduction of Number of Registers to be maintained under various Central Labour Laws:

Ministry of Labour & Employment has notified “Ease of Compliance to maintain Registers under various Labour Laws Rules, 2017” on 21st February 2017 which has in effect replaced the 56 Registers/Forms under 9 Central Labour Laws and Rules made thereunder in to 5 common Registers/Forms. This will save efforts, costs and lessen the compliance burden by various establishments. The Ministry has also simultaneously undertaken to develop a software for the 5 common Registers.

3. Registration process for EPFO and ESIC fully online on real-time basis:

In EPFO the process of allotment of registration number to any employer is totally online with no manual intervention. Similarly, in ESIC, the registration under ESI Act is done online on real time basis without requirement of any inspection or physical documents. No human intervention/approval is required for registration of employer.

4. MSMEs – Compliance regime based on self-certification:

In order to incentivize setting up of MSMEs to generate employment opportunities through them, Ministry of Labour & Employment has issued, an advisory to the States/UTs/Central Labour Enforcement Agencies on 19.02.2016 for a compliance regime based on self-certification and regulating the inspections of MSMEs under certain Labour Laws, through an Inspection Scheme. The advisory aims to simplify and ease the compliance burden of these MSMEs under 6 Labour Laws during their initial 3 years of establishment with an inspection scheme taking into account the self-certifying compliance with the 6 Labour Laws. MSMEs can self-certify compliance through a combined single self-certified return under these laws.

(The author of this article is a Practicing Company Secretary located at New Delhi and can be reached at [email protected])

Disclaimer: The contents of this document are solely for informational purpose. It does not constitute professional advice or a formal recommendation. No part of this document should be distributed or copied without express written permission of the author.

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September 2021