If you have to engage contract labor, then you must register your organization/factory as an Establishment under the Contract Labour Act. To do this, you need to use Form I. Along with Form I, you must submit a list of contractors you plan to engage. Only the contractors whose names you have submitted when obtaining the registration certificate can be issued Form V. If you wish to engage a new contractor, you must submit an additional list of contractors whose names need to be added to the Register of Contractors, which is maintained at the Labour Commissioner's Office.
According to the central Act, if the workforce strength is less than 20, then the contractor is not required to obtain a license. However, this requirement may vary from one state to another. Therefore, you will need to refer to the state rules to obtain accurate information.
Regards