Partner - Risk Management
R B Yadav
Advocate & Management Consultant On Labour
Statutory Complaince/labour & Employment
Manish Bali
Head - Ir/hr
Hr & Admin
Labour Law Consulting & Outsourcing
Prasad P K
Persuing Mba Degree In Hr
Hr / Ir
Labour Law Consultant
+2 Others

Dear Seniors,
Our is construction company. we are executing a project of NTPC (Principal Employer). We have obtained labour licence for 1000 workmen under CLA & we engaged 08 subcontractors who are providing us manpower for executing the job. Each Contractor is having the EPF Codes and the compliance is being done under their EPF Code.
Now Principal Employer is asking us to either cover all these workmen under our Establishment PF Code or take separate labour licence for each of our sub-contractor. As per PE they dont have any connection with our sub contractor so they will not accept any compliance (EPF) which are being done on their name.
So my question is that as we have obtained the labour licence and all our sub-contractor 's workmen are covered under same. Do we require to take saperate licence for our subcontractors under the act ?
waiting for your valuable suggestions....
Thanks & regards,

From India, Mumbai
Being Contractor ,As per CLRA Act Here you can not engage sub contractor , if you do the same you cant issue a Form -V to them , so it is better to take all employee name into your epf code and submit pf amount in same so that during Form -10 ( Payment wage sheet) presentation you can easily submit it before NTPC IR Manager .
From India, Calcutta
Jaspal you need not have to deduct the PF for the sub contractor, instead you may ask the sub contractor to get the form.V from the pricipal employer NTPC and ask them to submit the PF returns in their code.
However, any manpower he supplies comes through your work order, the rate for his work will be fixed by you only not the principal employer. Therefore it is not a problem.
If any query do call me 8754423744

From India, Madras
As per CLRA Act you can not engage sub contractor , if you do the same you cant issue a Form -V to them , i think better to take all employee name into your epf code and submit pf amount in same so that during Form -10 ( Payment wage sheet) presentation you can easily submit it before your Principal employer...

From India, New Delhi
It is common problem with big Corporate houses, they always recognizance only reputed Contractors in-spite of engaging petty contractors, NTPC has awarded the work assign/contact to your company, hence they will not issue Form no V to sub contractors and as such the quantity of the manpower is needed in bulk to execute the work. For all sub contractors, you will be the principal employer and you have to ensure whether all the compliance in respect of various labour laws such as payment of wages act, minimum wage act, CLA, BOCW Act. You have only one option but to talk with the NTPC management with technicality of the work as the assignment will be divided into different parts, hence talk with the managment in a positive manner and put your problems with them. There will be no violation of the CLA if you will deploy petty contractors to the different assignments subject to their commitment and compliance under labour laws.

From India, Mumbai
Mr. Jaspal and other seniors,
Only one thing is justified, from all the answers, that is from Mr. Yadav, he has rightly said that you are principal employer for your sub contractors, and it is your duty to ensure all the labour compliance followed by them.
But the remain question is still their, I think if you collect PF submission challans from all of your sub contractors, and submit it with your Bills, it must acceptable by NTPC. You may given in writing with all the names and other details of your sub contractors, to NTPC, that the on us of all the compliance from all the sub contractors is yours only. This may satisfy HR dept. of NTPC.
If you take separate licence for each sub contractor, you may loose your trust in NTPC, and NTPC may directly contact them, which will not suitable for your business.
Manish Bali/09223591292

From India, Delhi
Dear All,
You are hereby advised to go through the definition of Contractor under CLRA which is as under:
The point raised by Mr. Jaspal Negi will automatically clear the sence
“Contractor”- A person who undertakes to produce a given result for the establishment other than a mere supply of goods or articles of manufacture to such establishment through contract labour or who supplies contract labour for any work of the establishment. A contractor includes a sub-contractor
Tirlok Dhir/09872072450

From India, Gurgaon
Dear Jaspal,
You are acting as a contractor to the NTPC who is acting as Prinicipal Employer to you. As per law you are entitled to give work to the sub contractors. For this purpose you have to issue Form V certifications to all of your 8 sub contractors acting as Principal Employer to them and they shall obtain contractor licence in Form IV. All query is solved herewith.
I am attaching the judgement of the madras High Court to support my version of view.
For any further query you are always welcome to call me.
Thank to all,
Adv Raj Singh Phogat
Labour consultant

From India, Delhi

Attached Files
File Type: pdf The_Dean,_Agricultural_College_..._vs_Tmt._S._Sakilabanu,_Thiru_S._Mani_..._on_26_September,_200.PDF (94.0 KB, 79 views)

Dear all,
Thanks for your valuable inputs in the matter.
But my question is that as we have taken the labour licence for 1000 workmen in our establishment name then do we legally require to take separate licence for our subcontractors as all the compliance under CLA is being done by us. only the PF compliance is being done in the our subcontractors name under EPF Act.
Since both the acts are separate and are being complied so pls clarify do we really have to change in this.
thanks & regards,

From India, Mumbai
Dear Jaspal,
You do not have to take separate licences for the 8 sub contractors but all 8 sub contractors separately and individually shall obtain contractor licence to act under you. Your CLRA compliances are ok but ensure that all sub contractors do comply the CLRA compliances under your Principal Employership to them. Sub contractor are already having compliances under EPF act and so there seems to be no problem. Moreover NTPC is right in their correspondence with you for their insistance on this.
Adv Raj Singh phogat
labour law consultant

From India, Delhi

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