LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

RAMRAVINDRAN (co-ordinate)     21 April 2008


Hi, All,

In our industry, we have entered 9 contracts and each contactor having 18 - 19 persons only (to avoid the contractor side registration with IF). In that contact shall we allow subcontractors as per the applicable acts? Please guid us


 6 Replies


Dear Sir,

As per the proisions of Contract Labour Act,every establishment in which 20 or more workmen are employed is liable to take registraion.So u have to take registration.But the Contractors are not liable to take license as the are employing workers below 20.

If the Contarctors are sub contract there works,they become Principal Employers and they liable to take license as well as reg. under CLR (R & A) Act


Guest (n/a)     23 April 2008

Hai Jagan, For Andhra Pradesh we have to take CLRA licence in working more than 5 members. Seperte GO issued to supersed the ACT.

Guest (n/a)     04 May 2008

i want the details of contract labour,how 2 maintain the records and wat they are and payment varaitions i.e skilled ,unskilled...etc...

Saravana Rajan   20 May 2008

In case of employing contractors (who have less than 19), is the principle employer responsible for legal benefits of subcontract employees??? Pls guide me in this.

Saravana Rajan   20 May 2008

To add to my previous message, I would like to know if an employer has all of his employees on contract basis (for eg. 5 contractors with 15 employees each - total of 75 employees) IS THE PRINCIPLE EMPLOYER LIABLE TO PAY THE SOCIAL SECURITY BENEFITS LIKE ESIC AND PF ETC... Would appreciate if someone clears this with relevant quote from law. Pls.

Dr. K.S.N. Sarma (Director)     14 September 2010


Dear Friends

Let share my thoughts on this issue.

A contract labourer is defined in the Contract Labourer Regulation and Abolition Act, 1970  as one who is hired in connection with the work of an establishment by a principal employer (who is the firm owner or a manager) through a contractor. 

This act applies to any establishment in which 20 or more workmen are employed on a contract basis on any day of the last one year and also to all contractors who employ or have employed 20 or more workmen on any day of the preceding twelve months.

A casual labour does not get employed through a contractor.  Though his/her appointment may be not permanent, she or he has direct contract with the principal employer.  The act however, does not apply to the establishments in which work is intermittent or casual in nature. While the decision regarding whether the work is of casual nature or not rests on the appropriate government, if the work is carried out on more than 120 days in a year, it cannot be considered as intermittent.

The act makes a number of provisions for the welfare of the contract workers including payment of minimum wages, social security benefits and others. At various points of time Government amended the law with a view to make it more labour friendly.

In light of the above observations, when the employer is employing more than 75 workers on any day during the preceding 12 months, such establishment will fall within the ambit of the Act, and the Employer is bound to protect the welfare and social security interests of such employees, eventhough they are employed indirectly or through any other agency.  The Contractor is, however, exempt from taking License because he has not employed 20 or more workers.

with regards and thanks

Dr. KSN Sarma

Advocate & Management Consultant,

Website: www.clapsindia.com

E-mail: claps.n.claps@gmail.com




Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register