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We are working on customer site as their contractors in Jharkhand. We have our CLRA license from the customer.
Meanwhile, we have engaged workmen on rolls of our 3rd party vendor at the customer premise to subcontract some specialized skill jobs.
To obtain CLRA license, this 3rd party vendor requires Form 5 from the Principal employer. My question is :
are we the Principal employer or our customer, to issue Form 5 to enable them to obtain the CLRA license?


From India, Mumbai

This arrangement is very common in India - Contractor and Sub-contractor. For Labor license PE can only issue the Form-V not the contractor under PE.

Now the question is why PE will issue Form - V to subcontractor? It all depends on the PE's intention. At Jharkhand one very big and renowned Steel Plant is issuing Form-V to Sub-Contractor after checking the basic credibility of the sub-contractor along with Vendor's code.

In Maharashtra, I have noticed in past that there was an agreement that Contractor would do the main job but man power supply would be from Sub contractor. Based on the merit of the agreement, PE issued Form-V to both Contractor and Sub-contractor.

S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531

USD HR Solutions – To Strive towards excellence with effort and integrity

From India, New Delhi

Most companies will not give the documentation to the contractor to allow his subcontractors to work.
The contractor is not the PE, so he can not issue the form either

A proper, professional managed company will ask the contractor to put the employees into his own register and ensure compliance from his end. His personal agreement to the sub contractor is of no importance to the PE

From India, Mumbai

Dear SricityHR,

At no point of time, the same person could be both a Principal Employer and a Contractor to the same establishment for which a work is performed through contract labor. A contractor engaging sub contractors during the course of execution of the work for obvious reasons of economy, speciality, urgency and the like are practical possibilities. But such a contingency would not alter the status of the main contractor or sub contractors and as such they are bound by all the provisions of the CLRA Act,1970 pertaining to contractors.

From India, Salem
Pan Singh Dangwal

Dear Member,

I would like to add:-

It is important to check for how many personnel you have taken the Licence. If as a prime contractor you have taken the Licence for extra personnel (actual + projected) and the sub-contractor not require to deploy 20 or more persons (in Jharkhand) than your Licence is sufficient. However, you need to include data of sub-contractor's employees in the Half Yearly Labour Return.

In case the sub-contractor is require to deploy 20 or more employees than he can separately apply. The Form V will be issued by the PE only. (He will mention M/s XXXXX has been engaged as sub-contractor to M/s XXXXXX (Contractor) in my establishment for XXXXXXX work.....

In our most sites, generally we take license for whole manpower (Technical, Garden, Security, Housekeeping + extra projected) and include their data in Half Yearly Labour Return. Our sub-contractors have never taken the CLRA Licence.

From India, Delhi
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