Why Aren't Small Companies Penalized for Ignoring Labor Laws? Seeking Insights

Hello All,

I am working in a small organization with 34 employees, but this organization neither has registration in Shop & Establishment nor in PF. Also, it does not provide bonuses to employees. Please let me know why the labor law authority doesn't initiate penalties against such organizations where labor law rules are openly violated.

Regards,
Sachin

Clarification on Labor Law Coverage and Enforcement

1. You have not mentioned what type of organization you are working in. Is it a factory or an establishment?

2. Coverage under various labor laws depends on the provisions contained within those laws. If an establishment is subject to any labor law, it must comply from the date it engages the minimum number of persons required by that law.

3. To reduce complaints about "Inspector Raj," various governments, including the central government, have imposed conditions and restrictions on officials regarding their visits to smaller establishments. This may be one reason why many establishments succeed in not implementing various labor laws. If you find it appropriate, you can address this issue with state labor authorities, including central labor enforcement authorities, regarding the enforcement of labor laws in your establishment, including those related to bonuses.

Regards,
[Username]

Dear Sir,

Our organization is a partnership firm engaged in the trading business. Could you please clarify which part of labor law will be implemented in our organization?

Thank you.

Probably your organization needs to be registered under the state Shops and Establishment Acts.

Violation of labor laws can be brought to the notice of local labor authorities for necessary action.

Yes, sir,

Our organization should be registered under the Shop and Establishment Act, as well as with EPF and ESIC. Despite having 34 employees in our organization, there is no registration in either PF or ESI.

My question is, why are the labor law authorities sleeping while our organization openly violates the guidelines of labor law? None of the government authorities have taken any action against such organizations.

"My question is, why is the labor law authority sleeping while our organization openly violates the guidelines of labor law?

Do not worry about why the labor officer is sleeping. Be bold enough to take discreet action by writing to the labor officer. Remember, your company will not like it. If PF is not being provided, go to the nearest EPF office and file a complaint. The same applies to ESIC. Take bold but discreet action as you see fit."

When your organization has not approached the labor law authorities for registration and no one else has reported its existence, do you expect that the existence of your organization should automatically come to the attention of the labor law authorities unless someone informs them about violations of labor laws?

So, if you find yourself in an awakened state, why don't you take the initiative to alert the labor law authorities by providing complete details of the violations of labor laws by your organization? You should not expect that others will alert the authorities on behalf of an anonymous person without knowing the name of the organization, place, and incidents of violation, especially when the concerned person (yourself) doesn't have the courage to report the incident to them.

Better Take Some Initiative Than Playing Blame Games

The solution to your question lies in your own initiative.

Nowadays, Inspector Raj has been feeling sleepy due to the government's policy on promoting establishments and providing employment to unemployed individuals. If anyone is affected by the establishment policy, they can approach the authorities of the Labor Department for justice. The authorities will then intervene to ensure the implementation of labor laws.

You have not given any information about yourself, nor have you informed us regarding the roles you are in. I now have concerns, and someone like me might attempt to assume that you are engaging in negative roles within the organization.

My advice to you may not bring you pleasure; instead, it aims to awaken both you and others who may be facing similar problems. After some time, there may be relief and a sense of professional comfort in the same place where you are currently working.

Since you are employed in this organization, instead of waiting for an inspector to come and take legal action, as a paid member of the organization, you should proactively approach your Director. Make them aware of any violations of certain provisions which constitute offenses punishable by penalties and prosecution. Seek approval and go ahead with concrete actions.

If you are responsible for Labor Law compliance, prepare a document outlining the applicable provisions. Discuss these issues with the Director and obtain their acceptance and agreement on each matter. You will realize that many aspects of the recommended actions come with no additional cost, enabling you to take necessary steps.

Every home, city, country, and organization has areas that need improvement. It is up to us to seize this opportunity, create an action plan, and start implementing it.

We have all matured in this manner!

I discourage the idea of waiting for unwanted individuals to come and rectify the situation or for inspectors who come and go frequently.

Regards, RDS Yadav
Director - Future Institute of Management and Technology
and
Labor Law Advisor
[Email Removed For Privacy Reasons]