Lucknow: In a major policy reform aimed at strengthening Uttar Pradesh’s investment climate and accelerating its journey toward becoming a one-trillion-dollar economy, the state government has issued a significant order under the Ease of Doing Business framework.
Principal Secretary, Labour and Employment, Dr. M.K. Shanmugha Sundaram, announced that the government has implemented a statewide self-certification system and third-party audit mechanism through a government order issued on November 12, 2025. The initiative is designed to reduce regulatory burdens, boost industrial growth, and streamline compliance processes across the state.
Self-Certification for Low-Risk Establishments
Dr. Sundaram stated that under the new system, low-risk, non-hazardous factories and establishments opting for the self-certification mechanism will undergo only one joint inspection within a five-year period, conducted on a random basis.
Once inspected, such units will be exempt from further inspections for the next five years, thereby minimizing interruptions and enhancing ease of operations.
However, low-risk units that do not choose self-certification, along with medium-risk (hazardous) units, may opt for third-party inspections. These inspections will be conducted once every three years by government-approved third-party agencies.
The government has introduced this alternative system so that departmental intervention in enforcing labour law compliance at low-risk establishments is significantly reduced.
Special Provisions for Startups
In a major boost to the startup ecosystem, the state has introduced extensive relaxation for new enterprises:
- Startups classified as non-hazardous units, incubators, and centres of excellence will enjoy inspection exemption for 10 years from the date they are registered on the Nivesh Mitra Portal—or until they cease to qualify as startups, whichever comes earlier.
- During this period, inspections under labour laws will not be conducted except in cases involving verified and credible written complaints or accidents at the unit.
- Even in such cases, inspections may only be carried out with the permission of the Labour Commissioner, Uttar Pradesh.
High-Risk Factories to be Inspected by Department Officials
Only high-risk (highly hazardous) factories will continue to be inspected directly by departmental officers.
In cases of complaints or accidents, inspections will be permitted only with the approval of the competent authority.
A Step Toward a Stronger Investment Ecosystem
With the implementation of this new third-party inspection system, low-risk factories, commercial establishments, and shops that adopt self-certification will remain free from routine inspections.
This, officials say, will significantly reduce departmental interference, foster a more business-friendly environment, and encourage investment across sectors.
Dr. Sundaram emphasized that these reforms will play a critical role in ensuring Uttar Pradesh’s steady progress toward achieving the ambitious goal of a one-trillion-dollar state economy, while also ensuring transparency, accountability, and investor confidence.
The policy is expected to further strengthen Uttar Pradesh’s position as one of India’s fastest-growing economic destinations.
