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Improve ease of doing Business

Initiatives taken by the Ministry of Labour & Employment for Ease of Doing Business

1. Shram Suvidha Portal: In order to bring transparency and accountability in enforcement of labour laws and ease the complexity of compliance, Ministry of Labour & Employment has launched a unified Web Portal ‘Shram Suvidha Portal’ on 16.10.2014, catering to four major Organizations under the Ministry of Labour, namely –

 Office of Chief Labour Commissioner (Central),
 Directorate General of Mines Safety,
 Employees’ Provident Fund Organization; and
 Employees’ State Insurance Corporation.

The Portal provides for allotment of a Unique Labour Identification Number (LIN) to establishments, filing of self-certified and simplified Single Online Common Annual Return by the establishments and also a transparent Labour Inspection Scheme through computerized system based on risk based criteria and uploading the inspection reports within 48 hours by the Labour inspectors.

• Launching of the Shram Suvidha Portal has facilitated in bringing transparency and accountability leading to better enforcement of the Labour Laws. Transparent Labour Inspection Scheme has reduced the discretionary powers of the Inspectors and brought transparency in the inspection system thus minimizing the harassment of employers.

• The facility of Online registration for allotment of Unique Labour Identification Number (LIN) and the Transparent Labour Inspection Scheme was started on the Portal with its launch on 16.10.2014 itself.

• Filing of Single Unified Annual Return for 8 Labour Acts (10 Central Rules) was launched on 24.04.2015. It has facilitated in easing the compliance burden of the employers. Returns under the Contract Labour (Regulation and Abolition) Act, 1970, Inter-State Migrant Workmen (Regulation of Employment and conditions of Service) Act, 1979; and Industrial Disputes Act, 1947, which were half yearly / annually earlier, now need to be filed by all employers annually only. This effort is an evidence of use of technology in order to enhance transparency and minimize harassment contributing to ease of doing business.

• Online Common Annual Return filing under the Mines Act 1952, has also been facilitated on the Portal since 09.03.2016.

• In the process of taking States/UT’s on board on the Shram Suvidha Portal so as to enhance the coverage, Haryana has become the first State to join the Portal by 31st March 2016.

2. 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.

 The Employees Provident Fund & Miscellaneous Provisions Act, 1952
 The Employees State Insurance Act, 1948,
 The Building & Other Construction Workers (Regulation of Employment & Conditions of Service) Act, 1996,
 The Contract Labour (Regulation & Abolition) Act, 1970, and
 The Inter-State Migrant Workmen(Regulation of Employment & Conditions of Service) Act, 1979

3. Simplification/ Reduction of Number of Registers to be maintained under various Central Labour Laws: After examination by the Expert Committee constituted in the Ministry, it was found that various establishments have to maintain about 79 Registers as provided under various Central Labour Laws. Further, the information to be maintained under various Registers can be rationalize and simplified by avoiding duplicity of information or deleting redundant fields from the formats of the Registers. Moving forward, on this concept, the common fields were amalgamated and some rationalize resulting in reducing 56 Registers to 5 Registers to be maintained by the establishments. A pre-publication Notification dated 04.11.2016 has been issued to amend the Rules of respective Labour Acts to modify the format of Registers to be maintained. Simultaneously, software is being developed to provide the facility of maintaining these Registers in digitize format for further reducing the efforts in terms of time, human resource and money of the establishments.

4. 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. Once an application is submitted successfully the registration number allotted is displayed immediately within a few minutes. There is no visit of any personnel from the EPFO for collection of any documents as the required documents are uploaded by the employer at the time of application submission itself. 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. Registration number is generated once the information is submitted successfully and Registration Letter can be printed from the same screen. The Registration letter and password is also sent to the email id of the employer instantly. It is also notified on the homepage of ESIC website and on the sign-up page a message displays that “no physical documents are required for registration of employer under ESI Act”. Further, the condition of requirement of an existing bank account at the time of registration has been removed in ESIC with effect from 14th April 2016. In EPFO, the condition of requirement of an existing Bank account at the time of registration under EPFO will be removed very shortly. However, for the first return to be submitted to EPFO, the Bank Account will be required.

5. Start-Up India – Compliance regime based on self-certification: In order to promote the Start-Up ecosystem in the country and incentivizing the entrepreneurs in setting up new start-up ventures and thus catalyze the creation of employment opportunities through them, Ministry of Labour & Employment has issued on 12.01.2016 an advisory to the States/UTs/Central Labour Enforcement Agencies for a compliance regime based on self-certification and regulating the inspections under various Labour Laws. The advisory aims to promote setting of start-ups which are necessary for creating large employment opportunities. If such start-ups have furnished self-declaration, no inspection will take place under the specified 9 labour laws in the first year of setting up of the Start-up. This will allow start-ups to concentrate on their work. From the second year onwards, up to 3 years from the setting up of the units, such start-ups are required to furnish self-certified returns and would be inspected under these 9 labour laws only when credible and verifiable complaint of violation is filed in writing and approved by the higher authorities. This measure intends to avoid harassment of the entrepreneurs by restricting the discretion and arbitrariness in the matter of inspection of start-ups.

6. 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. For MSMEs which are less than 3 years old and have given a self-certified return mentioned above, the inspection scheme may provide that only a small percentage of such units shall be verified through a random risk based inspection system for compliance under the above mentioned laws. Further, the States/UTs may develop their self-declaration form to be furnished by the MSMEs during first year of establishment to decide the inspection criteria till the time the establishment files their first self-certified return.