The Role of Inspectors and Facilitators Under the Code on Wages Act

2019

Introduction to the Code of Wages

The Code on Wages, 2019 (hereinafter referred to as ‘Wage Code’) is to amend and
consolidate the laws relating to wages, bonus and matters connected therewith or incidental
thereto.

The Wage Code subsumes the following four existing labour law enactments:

 The Payment of Wages Act, 1936 (hereinafter referred to as “PWA”);

 The Minimum Wages Act, 1948 (hereinafter referred to as “MWA”);
 The Payment of Bonus Act, 1965 (hereinafter referred to as “PBA”); and
 The Equal Remuneration Act, 1976 (hereinafter referred to as “ERA”).

The Code on Wages Act, 2019 introduces a structured framework for the appointment and
function of Inspectors-cum-Facilitators (hereafter referred to as "Inspectors") to ensure
compliance and enforcement within establishments covered under its purview.

The precedential enactments had the concept of inspectors to carry out inspections and
examinations to ensure compliance of the enactments.

Now, under the Wage Code, the inspector regime is replaced with Inspector-cum-
Facilitator who shall be a facilitator towards compliance and not just an inspecting authority.
The Inspector-cum-Facilitator is required to provide the employer an opportunity to rectify
the non-compliance within a specified time before initiating any prosecution proceedings.
The appropriate government may lay down an inspection scheme which may also provide for
generation of a web-based inspection and calling of information relating to the inspection.
This dual role is intended to foster a more cooperative and less adversarial approach to
labor law enforcement.

Role of Inspectors-cum-Facilitators

1. Appointment and Jurisdiction

Inspectors-cum-Facilitators are appointed by the appropriate government, which could be the

Central or State Government, depending on the applicability of the Code. The jurisdiction of
each Inspector-cum-Facilitator is defined by the appointing authority, covering specific
geographical areas or sectors.

[1.] Appointment Process: The appropriate Government, through notification, appoints

Inspectors-cum-Facilitators across various geographical limits within a state or for
specific establishments, as designated1. This ensures a broad coverage and effective
oversight over compliance with the Code.

[2.] Dual Role: Inspectors appointed under the Code serve a dual function of inspection
and facilitation. They are tasked not only with conducting inspections but also with
advising both employers and employees on compliance matters, thereby promoting
understanding and adherence to legal provisions2.

2. Powers and Duties

The Code confers several powers and duties upon Inspectors-cum-Facilitators, including
inspection, facilitative, and enforcement roles. They have the authority to enter any
premises where employers and employees are involved in work related to the Code,
examine premises, machinery, and records to ensure compliance, question individuals,
require relevant documents, and take samples of materials used in the premises.
Additionally, they guide employers and employees in understanding their legal
obligations and rights under the Code, provide advice on compliance, and promote best
practices in wage payment to ensure transparency and fairness. For enforcement, they
can issue notices to employers specifying measures to rectify breaches and recommend
prosecution or penalties in cases of serious or repeated violations.

The Code confers several powers and duties upon Inspectors-cum-Facilitators:

[1.] Inspection Powers:

o Entry and Examination: Inspectors-cum-Facilitators have the authority to

enter any premises where employers and employees are involved in any work
related to the provisions of the Code. They can examine the premises,
machinery, and records to ensure compliance.

1
Section 51(1) of the Code on Wages Act, 2019.
2
Ibid.
 o Questioning and Investigation: They are empowered to question any person
found in such premises and require the production of relevant documents and
records for examination.
o Sampling: Inspectors-cum-Facilitators can take samples of materials used or
handled in the premises to assess compliance with prescribed standards.

[2.] Facilitative Role:

o Guidance and Assistance: Inspectors-cum-Facilitators are expected to guide

employers and employees in understanding their legal obligations and rights
under the Code. They provide advice on compliance, helping to resolve any
ambiguities or uncertainties.
o Promotion of Best Practices: They play a role in promoting best practices in
wage payment, ensuring transparency and fairness in employer-employee
relationships.

[3.] Enforcement Powers:

o Issuance of Notices: For any non-compliance detected during inspections,

Inspectors-cum-Facilitators can issue notices to the employer, specifying the
measures required to rectify the breaches.
o Prosecution and Penalties: In cases of serious or repeated violations, they
can recommend prosecution or the imposition of penalties as prescribed under
the Code.

Legislative Framework and Implementation

[1.] Regulatory Framework: The Code empowers the appropriate Government to

formulate rules for its effective implementation3. These rules encompass various
aspects, including the specific powers delegated to Inspectors-cum-Facilitators under
Section 51(5), ensuring clarity and procedural consistency.

[2.] International Standards: By adhering to international labor inspection norms, India

aims to enhance the credibility of its laborlabour regulatory framework4. The
incorporation of digital tools and standardized inspection practices reflects a
commitment to modernizing governance practices in line with global expectations.

3
Section 67 of the Code on Wages Act, 2019.
4
Labor Inspection Convention, 1947.
Comparative roles of Inspector (As under old laws) vs Inspector-cum-Facilitator

1. Jurisdiction and Nomenclature

The MWA and PWA provides that for the purposes of inspection and proper
implementation, Inspectors shall be appointed by appropriate government. The jurisdiction of
the inspectors shall be decided by the appropriate government. They may be appointed for all
factories within local limits as assigned, or specified local limits assigned for establishments.
The jurisdiction of the inspectors is limited under the repealed legislations.

The Code on Wages has brought several changes. Firstly, it has changed the nomenclature of
inspectors to inspector-cum-facilitator and has also extended and broadened its jurisdiction.
The jurisdiction will extend throughout the state or one or more establishment in a state or
one or more establishment in any geographical limit of that state or one or more
establishments irrespective of geographical limits. They shall inspect those establishments
assigned to him by the appropriate government.5

2. Roles & Responsibilities

The inspectors, under the MWA and PWA, can enter and inspect any premises at any
reasonable time. Its role is also to supervise the employed person regarding payment of
wages. The role of inspector-cum-facilitator under the Code on Wages, is more of a
facilitator and an advisor. They must advise the workers and employers for the compliance of
the Code. Regarding surprise checks and inspection, the Code is silent about it. Provisions
regarding surprise inspection at any reasonable time may be provided in the rules to be
framed by the appropriate government.

The Inspector-cum-facilitator has the following powers under the Code6:

a) Can examine any person who is believed to be a worker.

b) Require any person to give any information related to name and address.
c) Can search, seize or take copies of such register, record of wages, notices.
d) Any defect or abuses not covered by law may be brought into notice.

The Code has introduced the concept of Web-based inspection and information can be
gathered electronically also. All these reforms will help in proper enforcement of labour laws
with transparency and accountability

5
The Code on Wages, 2019, § 51, No. 29, Acts of Parliament, 2019 (India)
6
Ibid
 3. Inspection and Compliance Mechanisms

The MWA and the PWA provides that the claims must be filed within 6 months or 12
months respectively from the day the minimum wages are payable or any amount is due or
deducted.

However, the Code on Wages has extended the time-limit of filing of claims before the
authority to three years from the day the claim has arisen. 7 Due to the shorter limitation
period, it created a lot of difficulties to the workers in filing claims. To safeguard employee
interests, the period of limitations has been extended now. Any such claims can be filed by
the Inspector-cum-facilitator (among others as notified)8 within three years.

4. No Sanction required to file a complaint.

Under the MWA and PWA, before filing a complaint for a contravention of the law, it is
necessary to obtain sanction from the appropriate government or inspector. Once sanctioned,
complaints must be filed within one month (under the MWA) or six months (under the
PWA). Only specific individuals, such as legal practitioners, officials of registered trade
unions, Inspectors under the Act, or other authorized persons acting on behalf of an employed
person, are permitted to file these complaints. Complaints can be filed in any court. As per the
MWA and PWA, before filing any complaint for the contravention of law, sanction from the
appropriate government or inspector is required and such complaints has to be filed within
one month or six months respectively of the grant of sanction. Such a complaint can be filed
only by any legal practitioner, official of a registered trade union, Inspector under the Act or
other person acting with the permission of the Authority acting on behalf of an employed
person. A complaint can be filed before any court.

The Code on Wages has removed the need for sanction for filing any complaint. Such
complaint can be registered by any inspector-cum-facilitator, or others as notified by the code
or under authority of appropriate government.9 Such complaints can be filed before court not
inferior to metropolitan magistrate or judicial magistrate of first class.10.

7
The Code on Wages, 2019, § 45 Sub-Section 1, No. 29, Acts of Parliament, 2019 (India)
8
The Code on Wages, 2019, § 45 Sub-Section 4, No. 29, Acts of Parliament, 2019 (India)
9
The Code on Wages, 2019, § 52 Sub-Section 1, No. 29, Acts of Parliament, 2019 (India)
10
The Code on Wages, 2019, § 53 Sub-Section 2, No. 29, Acts of Parliament, 2019 (India)
ConclusionAMLEGALS Remark

The transformation from Inspectors to Inspectors-cum-Facilitators under the Code on Wages

Act, 2019, marks a significant paradigm shift in labour law enforcement. This dual role is
designed to promote a more collaborative and less adversarial relationship between
employers and regulators. By focusing on both compliance and facilitation, the new
framework aims to foster a better understanding of legal requirements among employers
while simultaneously protecting employees' rights. The integration of modern, web-based
inspection mechanisms further enhances transparency and accountability, aligning India's
labour regulatory practices with international standards. Overall, the Code on Wages Act,
2019, is a commendable step towards ensuring fair and just labour practices in India.The role
of Inspectors-cum-Facilitators under the Code on Wages Act, 2019, represents a progressive
shift in labor law enforcement in India. By integrating inspection with facilitation, the Act
aims to create a balanced approach that promotes compliance, protects workers' rights, and
supports employers in fulfilling their legal obligations. This innovative model is expected to
enhance the effectiveness of the wage code, contributing to more transparent and fair labor
practices in the country.