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Section 122: Appointment of Inspector-cum-Facilitators and their powers

The Code on Social Security, 2020 (Act No. 36 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter XI: Authorities, Assessment, Compliance and Recovery
Competent Labour Forum
Act No. 36 of 2020
Section 121 All 163 Sections of Code on Social Security, 2020 Section 123

Legal Commentary & Landmark Judgments: Section 122

Section 122 of the Code on Social Security, 2020 revolutionizes labor enforcement by establishing the dual-role office of the Inspector-cum-Facilitator, blending rigorous inspection, search, and seizure powers with an affirmative statutory duty to advise and facilitate employer compliance through transparent, web-based randomized digital inspection schemes.

  • Dual Role of Facilitator and Enforcement Authority: Empowers the appropriate Government to appoint Inspector-cum-Facilitators who, in addition to enforcing statutory mandates, are legally charged with advising employers and workers concerning the most effective means of complying with the provisions of the Code and rules framed thereunder.
  • Web-Based Randomized Digital Inspection Scheme: Mandates that inspections shall be conducted strictly in accordance with an objective, web-based inspection scheme formulated by the Central or State Government, utilizing randomized algorithmic generation of inspection schedules and centralized uploading of digital inspection reports within 48 hours to eradicate administrative harassment and rent-seeking.
  • Comprehensive Search, Entry, and Examination Powers: Invests the Inspector-cum-Facilitator with wide statutory powers to: (a) enter any establishment or workplace with necessary assistants; (b) examine any person found on the premises regarding social security compliance; (c) require the production of registers, muster rolls, wage books, and electronic data; and (d) seize or take copies of records, payroll databases, and certificates.
  • Mandatory Pre-Prosecution Rectification Opportunity: Section 122(6) enacts a pivotal compliance reform: prior to initiating criminal prosecution for non-compliance, the Inspector-cum-Facilitator must issue a written improvement notice giving the employer a mandatory statutory window to rectify the default, barring prosecution if compliance is achieved within the specified period.
Key Landmark Precedents:
  • Whirlpool Corporation v. Registrar of Trade Marks (1998) 8 SCC 1: The Supreme Court held that statutory enforcement authorities must act strictly within the four corners of the enabling statute, and search or seizure powers cannot be exercised arbitrarily or without jurisdiction.
  • State of Punjab v. Baldev Singh (1999) 6 SCC 172: The Constitution Bench affirmed that procedural safeguards surrounding search, seizure, and inspection are mandatory protections ensuring the rule of law and due process under Article 21.
  • Calcutta Port Shramik Union v. Calcutta River Transport Association 1988 Supp SCC 768: The Supreme Court held that the primary objective of labour inspection machinery is to secure the effective realization of worker rights rather than merely perpetuating formalistic punitive litigation.
Courtroom Practice & Strategic Litigation Guidance:

Corporate HR heads and plant managers should establish an 'Inspector-cum-Facilitator Response Protocol'. When an inspector arrives, verify their official digital inspection order generated through the Shram Suvidha portal; under Section 122, unnotified or non-randomized manual surprise inspections are impermissible without prior written authorization from the Head of the Department. If an improvement notice is issued, utilize the statutory rectification window immediately: cure the defect, deposit any unpaid contribution with interest, and submit the electronic compliance proof on the portal to secure an absolute bar against criminal prosecution.

Section 121 All 163 Sections of Code on Social Security, 2020 Section 123