Contractor Labour License - number of workers for principal employer? - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Hotgautam
Hr Manager
Kumar Alok
Hr And Administration

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We have labour license for 200 workers and engaged sub-contractor. They have taken labour license for 110. Whether the number of workers for principal employer should be counted as 200 of 310.
Dear Kumar,
The applicability of the CLRA Act,1970 to the Principal Employer's establishment commences whenever the employment of 20 or more number of contract labor takes place therein and his liabilities as PE under the Act revolves around his one time registration based on the application of the Act only. However, not only the licensing of the contractor, but also the registration of the PE is subject to amendment since the fee for registration is also based on the subsequent variation in the maximum no. of contract labor actually engaged by one or all the contractors in their respective contract works in the establishment as a whole.

Dear Kumar,
I do agree with the explanation of Mr. Umakanthan. The maximum strength is considered on the basis of registration taken by the principal employer. The total engagement of contract labour any day under contractor & sub-contractor should not be more than the number for which PE obtained the registration.
Further, the strength of your and sub-contractor no way should exceed 200. There is no space for sub-contractor under the statute. Rather the sub-contractor revolves around the PE and contractor. You have to check the nomenclature of Form V issued by the PE to sub-contractor for obtaining labour licence. If in any manner your name is not borned in Form V issued by the PE to sub-contractor, then the strength of your's & sub-contractor would be treated 200 & 110 respectively as mentioned in licence.

Please clarify how did your Subcontractor get a Licence un the CLRA Act. Did the Principal Employer issue him a Certificate of Engagement in FORM V seperately? If your answer is "yes", your Principal Employer have 2 independent contractors and in his Register of Contractors he would have to include your Subcontractor as well. The total of Licenced Capacity in that case would be 310.
However, if you have issued a seperate Work Order to your Subcontractor and his Labours are working with your work perifery allotted by the PE, they would be considered as your workers (thereby using your Licenced Capacity by the number of workmen engaged) and you would have to shoulder all Statutory Liabilities on account of those workers.
Your Subcontractor, however, can independently quote and be awarded contracts directly by your PE and be your competitor that may kindly be noted please.

I have a doubt to be clarified by the seniors. In outsourced contracts(like hiring of HEMM for excavation purpose) PE is not liable under CL Act for Licensing even if the contractor employs more than 20 workers. As per their say, since the job is outsourced there is no direct involvement of contract labour. Moreover if the work period is less than 15 days, then there is also no need of licence for contractors. Kindly elaborate this.
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