The Karnataka State Government has introduced the Karnataka State Factories Self Certification Scheme-2024 to streamline the enforcement procedures for various labour laws under a voluntary compliance framework by factory Occupiers. This initiative aims to foster a law-abiding and cooperative relationship between workers, management, and the government, focusing on protecting workers’ rights and ensuring a safe, healthy, and productive work environment.

The Scheme is designed for factories registered under the Factories Act, 1948, to encourage voluntary compliance with key labour laws such as the Factories Act, 1948, the Payment of Wages Act, 1936, and the Maternity Benefit Act, 1961. It offers a self-certification model, where the Occupier declares compliance with these laws, which is then validated by the Chief Inspector.

The Occupier of the factory who opts for this scheme will have to apply by submitting a self declaration in Form I, along with payment of registration fee, Security deposit and other requisite information to the Chief Inspector. Any discrepancy in the application or enclosures shall be communicated to the applicant within thirty (30) days from date of receipt of the declaration. If the Chief Inspector is satisfied that the declaration for covering Factory under this Scheme is complete in all aspects, he shall issue a certificate in Form-II within thirty (30) days registering the factory under the scheme.

Factories opting for the scheme must adhere to certain conditions, including regular filing of self-certification returns and maintaining transparency in compliance. The scheme is set for a validity period of five years, with the possibility for Occupiers to either continue or opt-out at the end of the period.

The Occupier of a factory to which the scheme is applicable may opt to enroll for the Scheme for all the applicable laws mentioned in provision 5 of this Scheme, by remitting registration fee of Rs. 10,000/- along with the security deposit of Rs. 50,000/-. Security deposits can be refunded upon successful completion of five years without violation.

The scheme excludes factories that deal with hazardous manufacturing processes or employ over 250 workers, or those engaged in operations involving toxic, inflammable, or explosive substances. The Scheme is also subject to the Chief Inspector’s inspection, which will occur on a random basis (not exceeding 20% of participating factories per year).

This initiative aims to reduce unnecessary inspections while ensuring that factory environments remain compliant with safety, health, and welfare regulations. By incentivising voluntary compliance, the scheme seeks to build a cooperative relationship between the social partners: workers, management, and government. The flexibility of opting in and out after five years, along with provisions for transparency, accountability, and the display of compliance information, ensures that the scheme remains beneficial for all stakeholders. It also supports the development of a more efficient regulatory environment by reducing the need for frequent inspections.