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Do away with inspector raj; let SMEs self-certify: Top Govt Panel

New Delhi, Dec 24 (KNN) High level inter-ministerial committee has suggested doing away with the practice of labour inspectors visiting micro and small enterprises and replacing the system with self-certification for labour laws compliance.
The inter-ministerial committee, chaired by secretary in the MSME Ministry, Madhav Lal has said in its report that until such time, the system of self-certification starts operating, “Ministry of Labour and Employment and state governments may direct factory inspectors to engage industry associations with adequately sized secretariat to assess the returns filed by the units and take responsibility towards their veracity.”
However, to ensure compliance the random checks can be taken up and heavy fiscal penalty imposed on business enterprises where non-compliances are detected.
The committee, constituted by the Union Cabinet Secretary to accelerate manufacturing in micro, small and medium enterprises stated that the state government should also be encouraged to allow self-certification with regard to labour legislations under their jurisdiction.
RBI Governor, Raghuram Rajan had also recently expressed his concern over dated Labour and Factory laws causing unnecessary harassment to units.
Some examples were cited to him where boiler inspectors would walk into the units engaged in software development.

“Entrepreneurs tell me about boiler inspectors showing up at software outfits, asking for the location of the boiler,” Rajan said.