Critics:- Code on Wages 2019 - Part 1
Rather than strengthening implementing mechanisms to realise its provisions, the Wage Code dismantles the inspection systems present in previous legislations, under which labour inspectors could carry out “surprise checks” and “examine persons” (Sundar 2017). There has been a constant vilification of labour inspectors through the narrative of the "inspector raj," highlighting corrupt practices of inspecting officials as the key deterrent to economic growth (Sundar 2017). However, such an analysis is misleading.
Under the previous wage legislations, few inspections and prosecutions could be carried out due to limited financial and human resources. For example, Maharashtra’s grossly understaffed labour department would take three years to carry out one visit per inspector of the 5,602 sites covered by the previous non-universalised minimum wage systems (Sundar and Sapkal 2018). In such a scenario, an overarching claim paints inspectors with too broad a brush, hiding the inefficiencies of the system that inhibits them from carrying out their work.
Furthermore, inspectors have now been termed "facilitators," the term itself making a mockery of their regulatory and enforcement authority. The task of facilitators to “supply information and advice to employers and workers concerning the most effective means of complying with the provisions of the code,” takes a more benevolent approach to wage violations by employers. At the same time, they will also be responsible for undertaking inspection based on the directions of the state governments. However, state inspection schemes provide for web-based inspections through an automated centralised system. This means that labour inspectors cannot conduct surprise checks after receiving information about suspected violations, make inquiries about employers or their agents, or enter workplaces as they please, other than when the time of inspection comes every three to five years through the automated system.
This system allows for a web-based self-certification scheme, where employers can certify themselves as being compliant to the provisions of the code. Such a self-certification scheme assumes that employers are keen to, and will naturally, comply with labour regulations. This is a misinformed position as there are a large number of instances of non-compliance with the existing labour laws. For instance, a study conducted by Aajeevika Bureau (2008) revealed that 68% of surveyed workers in southern Rajasthan had suffered a grave labour law violation in the previous year alone. These provisions for dismantling the inspections system have already been in action in some states for inspecting compliance to several labour laws, following which, violations have allegedly increased (Sundar 2017).
Along with this, the penalties on employers for not complying with wage laws have also been weakened, with penal inspections being replaced by guidance inspections. For instance, under the existing Minimum Wages Act, any payment less than the minimum wages is punishable by imprisonment in the first instance. The Supreme Court had pointed out in Sanjit Roy v State of Rajasthan in 1983, that non-compliance with minimum wages amounts to forced labour, which is constitutionally prohibited (PUDR 2017). While before, employers had criminal liability, under the present Wage Code, they only have a civil liability. Further, employers found to be violating the Wage Code will be given the opportunity to comply with the provisions of the Wage Code or give reasons for violation, and only compounded offences will lead to penalties.
The Wage Code also takes away the jurisdiction of courts in providing justice to workers who have faced violations with respect to their wages. This means that workers can no longer access courts to contest the wages paid to them by their employers, but can only approach the quasi-judicial body and appellate authority set up under the provisions of the Wage Code. The government is claiming that the setting up of an appellate authority to redress violations regarding workers’ wages will lead to speedy, cheap and effective resolution of wage disputes. However, it gives the appellate authority, whose membership is not defined, the sole power to adjudicate on wage disputes, which are not subject to review by the courts. This is in clear violation of the Civil Procedure Code, Section 9, which mandates that every law or decision made under its authority be subjected to review by the judiciary. A claim can only be filed by an appropriate authority, employee or trade union. This means that undocumented, casual and informal workers, as well as workers who do not belong to a trade union, will find it extremely difficult to file a case, thereby further disempowering them to assert their right to be paid the legally mandated wages. This move is a serious blow to workers’ access to basic rights in a country where 93% of workers have informal livelihoods (NCEUS 2008), more than 80% of workers do not have access to written contracts to prove their employee status (Sundar and Sapkal 2017), and less than 10% of workers are included in trade union membership (Ratnam and Jain 2002).
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