On February 20th 2025 , in a bid to promote better compliance with labor laws while improving the regulatory business environment, the Government of Tripura has introduced a new Third-Party Certification or Audit Scheme for medium-risk industries and establishments. This initiative, announced , is in line with the state’s commitment to the Ease of Doing Business norms.
Key Features of the Third-Party Certification/Audit Scheme:
1. Eligibility for Third-Party Auditor Firms:
- Firms applying for empanelment under the scheme must be registered in India as a corporate body (under the Companies Act or LLP Act) and must hold a valid Trade License.
- The firm should have experience in evaluating labor regulatory compliance and have a qualified Labor Law Auditor on its payroll.
2. Qualifications for Labor Law Auditors:
- The auditor should have at least eight years of experience in labor law compliance, legal practice, or have served as a Labor Inspector/Officer for a minimum of seven years.
- They must be under 65 years of age and medically fit to perform audits.
- Importantly, auditors cannot be currently employed by any unit in Tripura or its subsidiaries.
3. Auditing Process and Compliance:
- The auditors will conduct reviews based on existing labor laws and international best practices such as the Business Social Compliance Initiative (BSCI) and SMETA standards.
- The audit reports, which include compliance findings, must be submitted within 15 days of the audit’s conclusion.
4. Security Deposit and Performance Evaluation:
- Third-party auditors must submit a refundable security deposit of ₹50,000 to the Labor Directorate, which will be forfeited if any major discrepancies or false information is found in the audit report.
- The scheme also includes a two-year empanelment period, with a performance evaluation by a standing committee before any renewal or extension of tenure.
5. Establishment Enrollment:
- Medium-risk establishments, as defined in a 2024 notification, are eligible to opt into this scheme. After enrollment, businesses must submit their audit reports within 90 days.
- Failure to meet this deadline results in the establishment being unenrolled from the scheme and barred from re-enrollment for two years.
6. Exemption from Compliance Inspections:
- Once a business submits a compliant audit report, it will be exempt from further inspections for three years, provided they continue submitting timely annual returns.
- However, the Department reserves the right to conduct inspections if there are any compliance concerns.
7. Renewal of Enrollment:
- Businesses can renew their participation in the scheme after three years by submitting a new audit report. This renewal process must also be completed online.
Why This Scheme Matters:
This Third-Party Certification/Audit Scheme aims to streamline the compliance process for businesses, making it easier for them to meet regulatory requirements while promoting a responsible business culture in Tripura. By incorporating international standards in the audit process, the scheme ensures that businesses are held to high standards of labor law compliance.
The initiative is designed to reduce the burden of multiple inspections, create a more transparent system, and ultimately foster a business-friendly environment in the state.
