Navigating Labour Laws: Do We Need Multiple Registrations Across UP Cities?

Hello Fellows, our company is working in UP, based in Lucknow, and has projects spread across various cities in UP. We have contracted firms handling the jobs on the ground. Our company is registered as the Principal Employer with DLC Lucknow, with consistent follow-ups from DLC Faizabad as well.

Furthermore, after issuing Form V, our contractors have obtained Labour Licenses from various DLCs. Now, my question is whether we need to be registered in every DLC and pay 1% cess of the project cost, or if being registered in Lucknow would be sufficient.

Please clarify.

Regards, Nitin Kandya

Registration of Principal Employer under CLRA Act

I think there is a mix-up. The Registration of Principal Employer as per the CLRA Act is with respect to each establishment where the work is outsourced, so the registration of the Lucknow office alone does not suffice. If you are executing works throughout UP, then you need registration as the Principal Employer at all the places where the deployment of contract labor is twenty or more.

Payment of Cess under the Building & Construction Workers Cess Act

Next, the payment of cess at 1% is under the Building & Construction Workers Cess Act. This is a separate legislation, and the amount is to be deposited on the construction cost and need not be the project cost.

Your establishment needs to be registered with the authority as a Principal Employer in the area other than Lucknow, where you would like to execute the work. Upon registration, the labor authority of the concerned locality will issue the license to the contractors to whom you issued Form V.

The payment of CESS is not applicable to you (as the Principal Employer) but rather by the contractors you engage. They need to get registered and pay Cess at a rate of 1% based on the value of construction.