A Brief Overview of CLRA Registration & Licensing

In India, ministry of labour & employment is the governing body for making and implementing laws about the same. The prime control of the ministry is to secure the interest of the workforce, enforce employee-friendly laws & ensure compliance by the industry in the country.

These laws provide a regulative environment for problems like minimum wage, occupational safety, accidental & benefits for social security, health, conditions of employment, etc.

CLRA, or contract labour registration act, 1970, is a specific law regulating the utilise employees of your workforce. It issues the guideline based on which the industry controls the terms & conditions for the worker, which an outsourced contractor uses in any specific sector.

The act applies to the following:

• Any establishment that employs twenty or more workers on any of the financial years as a contract worker
• Any contractor who used or employed twenty or more workers on any day of the financial year

The act does not apply to the following:

• It does not apply to any establishment that performs work of an intermittent nature.
• It does not apply to any establishment that has not performed any work for more than 21 days in years.
• It does not apply to any establishment situated in the special economic zone.
• It does not apply to any establishment that has performed any seasonal work for more than sixty days in one year.

How vital is CLRA for the Principle employer?

The CLRA license relevancy is for the contractor, and the CLRA registration relevancy is for the principal employer. The CLRA act suggests that employing contract labourers in your organisation is unlawful without the above two compulsory requirements. Hence, the leading employer must ensure that the contractor they hire has fulfilled all the obligations by the CLRA license.

What you know as a Principal Employer

Notwithstanding whether you have obtained registration under the CLRA, you must be fully aware of the liabilities you carry as part of the CLRA act. The principal employer has to ensure that the contractor entirely takes care of the employee’s welfare, including the availability of restrooms, canteens, drinking water, physical safety, first aid, etc., by the contractor.

If the contractor does not, it falls on the principal employer to make these accessible to the contract employees.

The ministry is accountable for promoting the welfare and security of the workforce in organised and unorganised employment sectors. Each organisation employing contract workers must know this law and ensure compliance.

Compliances related to CLRA Registration and licensing are:

1. Notice of commencement or completion of contract work Form VI-B
2. Maintenance of Registers and Records
3. Register of Contractor Form XII
4. Register of person Employed Form XIII
5. Employment Card to each labour within 3 days of employment in Form XIV
6. Service Certificate on termination of worker Form XV
7. Muster Roll Form XVI
8. Register of Wages Form XVII

When should one apply for CLRA registration and licensing?

Any company or principal employer whose work and hiring patterns falls under the criteria of applicability of CLRA needs to apply for CLRA registration. At the same time, the contractor requires a CLRA licence from the appropriate Government for contracting workers to establishments.

Documents required for registration

Following are the documents required for the registration of the principal employer by the contract labour (Regulation & Abolition) Act:

• Copy of the report that shows the legal status of the firm.
• A photo of the document with allotted PF Cord No.
• Copy of the insurance policy or receipt or the cover note that has been received.
• Challan copies to prove remittance of security deposit.
• The license fee for receiving the license.

Documents required for the license

the Following is the list of documents necessary for the grant of permission of Contractors by the Contract Labour (Regulation & Abolition) Act:

• Form V
• Valid work order
• Trade license
• Any other compulsory particulars, if required.

The procedure of Registration of Principal Employers

The Ministry of Labour & Employment makes the Unified Shram Suvidhi facilitate reporting of inspections and submission of Returns.

The procedure of CLRA Registration of Principal Employer of an Establishment by Contract Labour (Regulation & Abolition) Act is as follows:

Step 1: The applicant must register by providing basic details such as name, email, mobile number, etc.

Step 2: After registering, the applicant files the application in the appropriate Form with all the required details.

Step 3: The details that are required file in the Form are:

• Principal Employer details
• Establishment details
• Manager details
• Contractors details
• Contract work details

Principal Employer Details

• Name
• Address
• Designation
• Gender
• Email
• Mobile No.
• Father/husband name of the Principal Employer
• Establishment name
• Contract type
• maximum number of Contract labour employees on any day
• Registration fee

Number of Workers	Registration Fee
20	Rs. 60
More than 20 but less than 50	Rs. 150
More than 50 but less than 100	Rs. 300
More than 100 but less than 200	Rs. 600
More than 200 but  less than 400	Rs. 1200
Exceeds 400	Rs. 1500

Establishment Details

• Name of Establishment
• Location of Establishment
• Ownership type or sector
• Activity according to National Industrial Classification
• Details of selected NIC Code
• Nature of work carried on in Establishment
• Identifiers of Establishment
• Identifier of Establishment

Manager Details

• Name of manager or any person responsible for supposable for supervision and control of Establishment
• Address of manager
• Email address
• Mobile number
• Contract type

Contractor Details

• Name of Contractor
• Maximum number of contract labour employed through this contractor on any day
• Address of contractor
• Email address
• Mobile number
• Identifier of Contractor
• Contract type

Contract Work Details

• Location of contract work
• Contractor
• Estimated date of commencement of contract work
• Activity according to National Industrial Classification
• Estimated date of completion of contract work
• Details of selected NIC Code
• Nature of the work for which contract labour is employed
• Contract work details

Step 4: After providing all the details, the applicant makes payment and submits the application form.

Step 5: The department approved the application and granted the CLRA Registration Certificate.

The Procedure for the CLRA License

Step 1: The applicant makes an application at Shram Suvidha of the Ministry of Labour & Employment.

Step 2: The Application form contains the details;

1. Contractor Details

• Name of Contractor
• Name & Designation of Representative
• Address of Contractor
• PAN of contractor
• PAN Card details
• Address of Representative
• Mobile number of Representative
• Contract type

2. Establishment details or Principal Employer Details

• Registration Certificate number of the Establishment
• Name and Designation of Principal Employer
• Date of Registration
• Address of Principal Employer
• Email of Principal Employer
• Mobile number of the principal employer

3. Contract work details

• Name and nature of work for which the workman is employed or is an employee in the Establishment
• Estimated date of commencement of Contract work
• Estimated date of completion of contract work
• Name of Agent or Manager of Contractor at the worksite
• Location of work
• Activity according to National Industrial Classification
• Details of selected NIC Code
• The maximum number of contract labour employees on any day
• Certificate by Principal Employer
• Security Fee
• License Fee

Number of Workers	License Fee
20	Rs. 15
More than 20 but less than 50	Rs. 27.5
More than 50 but less than 100	Rs. 75
More than 100 but less than 200	Rs. 150
More than 200 but less than 400	Rs. 300
Exceeds 400	Rs. 375

 

Step 3: The applicant then attaches other required documents and submits the license application after making payment.

Step 4: The department issues the CLRA License to the contractor.

Penalties and Violations of CLRA Registration and license

by the CLRA laws in India, a principal employer cannot legally employ a contract employee unless they have gotten a CLRA registration from the competent authority, i.e., the Government. Can punish the primary employer with imprisonment of up to three months. He can punish with a fine of Rs.1000/- or both by Section 23 of the Act in case of a violation.

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