From "manasilko" : Hi,
Please provide your opinion on the below 2 cases:
Case 1:
If a company has an agreement with a vendor to provide contract labours for a 6 months contract, then is CLRA applicable on the IT firm. Does it need to take registration to have those contract labours.
Case 2:
If a company has an agreement with a vendor to provide contract labours for a 6 months contract, but these contract Labours are Full time Employees for the vendor. Then, is CLRA applicable on the IT firm. Does it need to take registration to have those contract labours.
Thanks in advance,
16th May 2011 From India, Delhi

Dear Mr.Manasiko From the information provided by you, in both the cases, the CLRA Act is applicable
17th May 2011 From India, Madras
Please note that there is NO relation of Employer and Employee between Principal Employer and contract labours. So resignation doesn’t require. Simply issue FORM 6 to Contractor.
18th May 2011 From India, Ahmadabad
As others have already stated, you need to have 20 or more workmen on contract for the applicability of CLRA Act including all other contractors. In that case you need to take registration under the Act and the contractors have to take a licence and comply with all applicable laws.
18th May 2011 From India, Pune
Hi Mansi,
In this case, the IT company is the 'Principal Employer' and the vendor is the 'Contractor'.
The CLRA is applicable to all institutions where more than 20 contract labour are hired. Some sections of the Act are relevant to the principal employer and some, in-fact most are applicable to the contractor.
The principal employer will have to register with the labour department of the state and obtain a registration certificate.
Based on the principal employer's registration certificate a Form V is issued to the contractor who in turn will apply to the labour department after paying certain fees per individual. The Form V of the contractor is to be submitted alongwith a copy of the principal employers registration certificate and proof of payment of fees/DD as required by the state labour department.
The contractor is then issued his license in about one months time. I'm sorry to state that the labour department is incorrigibly corrupt and will expect some compensation, if you are in a hurry. If you are not in a hurry, your UPC receipt will suffice till they issue the license, in due course.
The license is generally for one year and can be renewed. There is a small renewal fee and of course the departments gratification!!
I hope I have been able to help. If not you can either contact me on my mobile or email me :
Colonel Gahlot
Proprietor 'TRURECRUIT' Placement Consultancy
9810081197 begin_of_the_skype_highlighting 9810081197 end_of_the_skype_highlighting
18th May 2011 From India, Delhi
Thanks everyone! How long is the contract labour hired for? Till the work is done or for a fixed time frame (e.g i year) What is the termination policy of these contract labours?
19th May 2011 From India, Delhi
Dear Manasilko
The period for which a contract labour is to be hired is need based and is the look out of the contractor and not that of the principal employer.
The contract labourers are to be terminated by the contractor and not by the principal employer. However, if the contract labourers are terminated by their employer(contractor), he has to comply with the provisions relating to payment of retrenchment compensation and notice pay in case the labourers had put in one year of continuous service. In case either chapter V-A or V-B of the Industrial Disputes Act 1947 is applicable to the contractor, then the procedure prescribed therein has to be followed
19th May 2011 From India, Madras
one more question-
If am employee is present on a fixed term contract then:
Q1) What should be the duration of the contract so that the employee cannot claim permanency
Q2) How many times should the contract be renewed so that the employee cannot claim permanency
20th May 2011 From India, Delhi
Dear Manasilko
I do not know in which State in India you are employed. Please tell me whether your State had passed any law relating to conferment of permanent status to workmen, if they work for a particular period of time or number of days.But there is no law passed by Parliament conferring permanent status to workmen if they work for a particular periof of time or number of days. In Tamilnadu there is a law passed by the State legislature which confers permanent status to workmen who have worked for 480 days in a period of 2 years with an employer. You would appreciate that that word "permanency" does not occur in the Industrial Disputes Act. If you give the information I requested, may be, I will be able to form an opinion on this issue
With regards
21st May 2011 From India, Madras
Dear Sir/Madam,
1. my opinion differs regarding case 2. These employees won't come under purview of the CLRA'70. In case of CLRA workmen engaged only for the job contract by appointment through Form-XIII of the CLRA are workmen under CLRA'70 or rules framed thereunder. For the employees of the contractors permanent roll, no re-appointment through Form-III is required.
2. Rgarding the CLRA applicability figure, 20 is for organisation coming under purview of CLRA central rules but i.r.o orgs under purview of CLRA State Rules, the figure is in most cases 10. It needs to be seen.
3. For dos' and donts' to minimise ir issues emanating from CLRA'70 workmen, please find an attachment for brush up.
Thanks & Regards
21st May 2011 From India, Calcutta
Attached Files
File Type: pdf Dos' n Donts' for PE under CLR Act.pdf (266.4 KB, 244 views)
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