(This article deals only with the theory of checks and balances in the functioning of an organization and not the practice in Test Inspections, which will be dealt with separately. The theories must always be correct and take into account the problems that would be encountered in the field when it is enforced).
Every system in a democracy must have checks and balances. As far as the ESIC is concerned, a provision for inspection of factories and establishments was incorporated in the ESI Act to facilitate monitoring proper compliance by the employers. Inspecting the records of the past periods helps the ESIC Administration detect (a) the occasions and (b) the manner in which the employers had, in the past, concealed the concealment of employment of persons and payment of wages. Such inspections help the Administration to find remedial measures to ensure that such concealments do not recur in future. The ESI Act is a labour-welfare legislation and the provision for inspections in the Act are, obviously, intended to advance the purpose of labour and their welfare. Such advancement can be achieved only when the inspections are done in a qualitative manner with adequate depth and substance. This being the importance of inspections under the ESI Act, as a natural corollary, the Administration must provide a system to monitor the performance of the Inspectors, the way there is a need to police the police.
The only way in which such monitoring can be done is to conduct Test inspections by higher officers. This system of checks and balances is there in the EPF Organisation also where it is called Supervisory Inspection.
Test Inspection is only an Administrative action
Test Inspection is only an Administrative action. It does not require any statutory provision. Reg. 102 of the ESI (General) Regulations, 1950 was found adequate for conducting Test Inspections. There was no problem on this issue until some employer went to court and got an interpretation that there was no provision for test inspection in the ESI Act. But, there were many Courts, which did not find fault with the system of such test-inspection. Moreover, the matter was not taken up with higher judiciary for any final verdict on the issue. The legitimacy of test inspections can be explained and justified by the ESIC by citing the practice followed in other departments. That would have protected the interests of the organization. However, it was not considered so essential at that time as the test inspections were continued to be done everywhere by calling them only as inspections (although they were done by the officers who were superior in rank to that of the inspectors).
But, all of a sudden Test Inspections were stopped describing them, strangely, as ‘harassment of employers’. This kind of phraseology in official communication puzzled the readers, as the test inspection was intended to monitor the quality of inspections conducted by the inspectors. That the employer had to pay, sometimes, additional contribution was only a consequential effect. Continue reading