Hi Sunil,
I was working with one of the manufacturing unit in Maharashtra. I have observed following problems, regarding labour, which are the cause root of retention.
1) Labour needs basic requirements, like they want their salary should be calculated without any mistake (Mainly calculation of Over time).
2) Labour had many doubts that, their PF amount is going in right account or not.
Solution - Here we arranged a lecher of our legal consultant to clear up their doubt regarding PF and ESI. Also provide them detail information of each column mentioned in PF slip.
Some retention strategies for contract labour :- I have experienced, that worker is very shy person in company.Try to treat them with love and affection. (Always give smile, first ask them about health-then family-then work.) Assure them that HR is always their to help them. Once you came to know their problems try to give solution as soon as possible. I did the same and became ideal HR for them..!!

- HR should have proper communication with union leader/ lead hands of worker to know about their problem.
- If Possible, take some contract labours on roll as per law.
- Make sure that senior workers or supervisors are not exploiting contract labour.

- You can provide more facilities to permanent worker ie Labour welfare, workers participation in Management.
- When workers assured that, 1. he himself and his future and his family is safe with this company, 2.whatever wages they are getting is as per Minimum wages, 3.their PF amount is safely deposited in theier own account,4. getting more facilities competitively to other organization,5. Friendly work environment, then retention rate will be decrease.
So this is what I have experienced. Hope this will help you. If you have any other ideas regarding this matter, please let me know.
There may be different situations in different Organisation.
Wish You All The Best..!!
