India: Wage Code, 2019 introduces web-based Labour inspection

September 6, 2019

By Vikram Narula and Reetika Wadhwa

The Central Government has introduced the option of web-based inspection in an attempt to remove the geographical limits that restricted labour inspectors to a fixed territory. The new Wage Code, 2019[1] (the ‘Code’) will replace the old system, and the new system will allow Labour inspectors to be chosen online and will be assigned to factories in order to not restrict them to a specific region which facilitated corruption.

The Ministry of Law and Justice has attempted to broaden the jurisdiction of the inspectors to ensure that the employer can deal with one inspector for compliance instead of different inspectors  under different labour legislations.

Section 51 of the Code states that the Government may appoint inspector-cum facilitators who shall exercise the powers conferred on them irrespective of the geographical limits.

Existing labour laws paved way for corruption as there was a nexus built between the labour inspectors and the employers as the inspectors were confined to local limits. This initiative provided the Government with the power to assign a broader territory to inspectors which will be undertaken basis a randomized selection. For instance, a labour inspector in a city can now be assigned to inspect a company for compliance under the Code in another city. The Code also allows the Central Government to set a minimum statutory wage limit, a move that is expected to positively affect the lives of about 500 million workers.

The Code which is the first in a series of four codes that the Government plans to introduce as a part of its labour reform initiative seeks to ensure minimum wages with timely payment to all employees. Furthermore, the minimum wages prescribed by the Government will now be based on geographical limits and skills and not on employment



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