The government of India looks after employment and labour policies through the Ministry of Labor & Employment (MoLE), which is responsible for formulating and enacting legislations in this field. The basic mandate is to safeguard workers’ welfare interests, making rules that are in the favour of staff and enforcing laws among industries.
Legal protection ensured through regulations covers many issues, from minimal wages to occupational safety, which is further extended to private space, social securities, healthcare and working conditions.
One of the fundamental laws in the area of contract labour is the Contract Labour (Regulation and Abolition) Act, 1970 (CLRA) which applies to all kinds of sectors for engaging contract employees. This act is the instrument giving the field for the industry to handle the conditions in the employment for the workers because their employment is through an external contractor and whoever is that main person.
What is CLRA Licence?
A CLRA registration or licence, under the Contract Labour (Regulation and Abolition) Act, 1970, is a mandatory registration for contractors who employ contract labour in certain sectors. It ensures compliance with labour laws, regulating terms of employment and safeguarding the rights and welfare of contract workers. When the licence is expired, one must apply for the CLRA licence renewal.
Significance of CLRA for the Principal Employer
The relevance of a CLRA registration is for the contractor, while the CLRA registration is important for the principal employer. The Act stipulates that it is illegal to employ contract labour in an organisation without these two essential prerequisites. Therefore, the principal employer must ensure that the contractor they engage complies with all the requirements of the licence.
When to Apply for CLRA Registration and Licensing?
Any company or principal employer falling under the applicability criteria of the CLRA should apply for CLRA registration. The CLRA licence full form is Contract Labour Regulation Act Licence. Concurrently, contractors need to obtain a licence from the appropriate government authority to contract workers to establishments.
Documents Required for CLRA Registration
The following documents are needed for the registration of the principal employer under the CLRA Act:
- A copy of the document demonstrating the legal status of the firm.
- A photograph of the document with the allocated PF Code Number.
- A copy of the insurance policy, receipt or cover note.
- Challan copies to evidence the remittance of the security deposit.
- The licence fee for obtaining the licence.
Other Documents Required for the Licence
The following documents are necessary for granting a licence to contractors under the Contract Labour (Regulation & Abolition) Act:
- Form V.
- A valid work order.
- Trade licence.
- Any other mandatory details, if required.
Registration Process for Principal Employers
The Ministry of Labour & Employment provides the Unified Shram Suvidha platform for reporting inspections and submitting returns. The registration process for the principal employer under the Contract Labour (Regulation & Abolition) Act is as follows:
Step 1: The applicant needs to register by providing basic information such as name, email and mobile number.
Step 2: After registration, the applicant must file the application in the prescribed form with all necessary details.
Step 3: The required details to be filled in the form include:
- Principal Employer details: Name, address, designation, gender, email, mobile number, father/husband’s name
- Establishment details: Name, location, ownership type or sector, activity according to National Industrial Classification, details of selected NIC code, nature of work carried out in the establishment
- Manager details: Name, address, email, mobile number, contract type
- Contractor details: Name, the maximum number of contract labour employed on any day, address, email, mobile number, the identifier of the contractor, contract type
- Contract work details: Location, contractor, estimated dates of commencement and completion, activity according to NIC, details of selected NIC code, nature of work for contract labour, contract work details
- Registration fee: Based on the number of workers, ranging from Rs. 60 for 20 workers to Rs. 1500 for more than 400 workers.
Step 4: After providing all details, the applicant must make the payment and submit the application form.
Step 5: The department reviews the application and, upon approval, grants the CLRA Registration Certificate.
Procedure for Obtaining a CLRA Licence
Given below is the general process of getting registration under CLRA:
Step 1: The applicant must apply at the Shram Suvidha portal of the Ministry of Labour & Employment.
Step 2: The application form should include details such as:
- Contractor Details: Name, designation of the representative, address, PAN, PAN card details, address of the representative, mobile number, contract type
- Establishment or Principal Employer Details: Registration certificate number, name and designation of the principal employer, date of registration, address, email, mobile number
- Contract Work Details: Name and nature of work, estimated dates of commencement and completion, name of the agent or manager at the worksite, location of work, activity according to NIC, details of selected NIC code, maximum number of contract labour employees on any day
- Certificate by Principal Employer, Security Fee, Licence Fee: Based on the number of workers, ranging from Rs. 15 for 20 workers to Rs. 375 for more than 400 workers
Step 3: The applicant must attach other required documents and submit the licence application after making the payment.
Step 4: The department reviews the application and, upon approval, issues the Licence to the contractor.
Final Words
The CLRA Licence applicability is for businesses employing contract labour, ensuring compliance with the Contract Labour (Regulation and Abolition) Act, 1970. A successful route to success implementation can be obtained through applying the process without having many difficulties.
The process begins with CLRA licence online registration on the Shram Suvidha portal, then the application is filled up with detailed info about director, manager, contractors and contract works of the principal contractor. This application must be accompanied by the related documents and payment of registration fee calculated in line with the number of workers staffing the enterprise.
Therefore upon submission, the department has to review your application, if approved, then it issues you the certificate. It serves the purpose of keeping the company within legal boundaries and of ensuring that workers’ rights and privileges are respected at all times.
FAQs
1. What is a CLRA licence and who needs it?
A CLRA licence regulates contract labour employment; required by contractors employing contract labour in certain sectors.
2. Is CLRA registration applicable to all businesses or are there specific criteria for its applicability?
Not all businesses but CLRA registration is applicable based on specific criteria like the number of contract labour employed.
3. Can I apply for a CLRA licence online or is it only available through offline channels?
Yes, you can apply for a CLRA licence online through the Shram Suvidha portal of the Ministry of Labour & Employment.
4. Can StartupFino provide assistance in understanding and implementing CLRA registration regulations effectively within an organisation?
StartupFino can provide guidance on CLRA registration regulations, ensuring effective compliance within an organisation.
5. How does integrating CLRA licence support into StartupFino’s services contribute to overall business compliance and welfare practices?
Integrating CLRA registration support with StartupFino’s services promotes business compliance and welfare practices.
