Navigating Factory Licensing: Do I Need a Labor License for Contract Workers?

Dear Members, I have one doubt. If I have taken a factory license and started our factory with 200 to 250 contract laborers, is a labor license or employer registration license required for engaging the contract labor? May you please give me some suggestions?

Thank you.

Compliance with CL(R&A) Act 1970

You have to fill Form I and obtain Form II as per the CL(R&A) Act 1970. Only then can you engage any contract labor through contractors. Along with the application, you must provide a list of contractors whom you are going to engage in your factory for carrying out the job.

After obtaining the Registration Certificate for engaging contract workmen, you can issue Form V to your contractors so that they can apply for a Labor License, as advised by Mr. Jaynarayan Modi.

Is it mandatory to record all the contractors' data such as PF, ESI, PT, WC policy, wages register, bonus details, overtime, and maternity leave details? Please suggest.

Regards,
Abhi

To answer a direct question, yes, you need registration, and all your contractors need a license if they have more than 19 workers employed by them on contracts. However, you may get into trouble trying to do all work through contract labor. You can only use contract labor for non-core and non-perennial work. You should not be using them for production-related work.

Dear Sir,

Are you going to employ any permanent workforce or run the entire operation with contractual labor? Is it a job contract or a contract of service? In any case, you need to enter into an agreement on stamp paper in the proper format, covering all possibilities and the scope of work with the contractor. You will have to register under the Contract Labor Act, and the contractor will need to obtain a license. All labor laws must be followed by the contractor, and your representative will have to be present during the wage disbursement and endorse the record.

Regards,
Adv. Sawant
[Phone Number Removed For Privacy Reasons]
[Email Removed For Privacy Reasons]

Good Evening All,

I WANT TO KNOW THE DETAILS OF ANNUAL RETURNS FOR A MANUFACTURING COMPANY...

Thanks and regards

Dear Sir,

There are various returns under labor laws to be submitted. I am attaching one annual return that needs to be filed under the Factories Act.

Regards

Dear sir, Yes, as you are the Principal Employer, it is your duty to ensure all statutory compliance is fulfilled by the contractor, for all those you are paying service charges.

Thanks

No, without a labor license, you can't engage contract labor.

Regards,
Bharat Mudgal

Dear Shweta,

Understanding Form 20 Under the Factories Act, 1948

Form No. 20 refers to the combined return under the Factories Act, 1948. It includes the following returns:

Details are given below:
- Factory License No:
- Year Ending:

i) Form 20, Rules 134 Karnataka Factories Rules, 1969
ii) Form XXV, Rules 82(2) Contract Labour (Regulation & Abolition) Karnataka Rules, 1969
iii) Form III, Rules 22(4) Karnataka Minimum Wages Rules, 1958
iv) Form D, Rules 5 Payment of Bonus Rules, 1975
v) Form IV, Rules 20 Karnataka Payment of Wages Rules, 1963
vi) Form K, L, M, Rules 16 Karnataka Maternity Benefit Rules, 1963

Regards,
Bharat Mudgal

Dear Mr. Kar,

Requirement for Labor License and Employer Registration

The Contract Labour (Regulation and Abolition) Act is applicable to any establishment that engages more than 20 workers as contract labor on any day in the preceding 12 months. Therefore, you are required to apply for a labor license and registration under the act.

Regards,