CLRA Registration & Licensing

Overview - CLRA Registration & Licensing

The Contract Labour (Regulation and Abolition) Act, 1970 (CLRA Act) was enacted to regulate the employment of contract labour in certain establishments and to provide for its abolition in certain circumstances.

The Act applies to establishments that employ 20 or more contract labourers on any day of the financial year. Principal employers of such establishments and contractors who employ 20 or more contract labourers are required to register under the Act.

Benefits of CLRA Registration & Licensing

• Compliance with the law: The Contract Labour (Regulation and Abolition) Act, 1970 (CLRA Act) is a law that regulates the employment of contract labour in India. By registering under the CLRA, you ensure that you comply with the law and avoid penalties and legal complications.
• Protection of contract workers' rights: The CLRA sets out certain rights for contract workers, such as the right to fair wages, the right to rest and leisure, and the right to safety and health. By registering under the CLRA, you are helping to ensure that these rights are protected.
• Access to government benefits and schemes: A number of government benefits and schemes are available to registered establishments. By registering under the CLRA, you may be eligible for these benefits.
• Reduced risk of penalties: If you are found to violate the CLRA, you may be subject to fines, imprisonment, or other penalties. By registering under the CLRA, you can help to reduce the risk of these penalties.
• Improved brand image: By registering under the CLRA, you demonstrate your commitment to compliance with the law and the welfare of your workers. This can improve your brand image and make you more attractive to customers and investors.
• Increased efficiency: By registering under the CLRA, you must maintain certain records and registers. This can help you improve the efficiency of your operations by ensuring that you have accurate records of your workforce and their work hours.
• Reduced liability: By registering under the CLRA, you can reduce your liability in the event of an accident or injury to a contract worker. This is because the CLRA sets out certain standards you must meet regarding safety and health.

Eligibility of CLRA Registration & Licensing

• The establishment must employ 20 or more contract labourers on any day of the financial year.
• The establishment must be located in India.
• The establishment must be engaged in any industry, manufacture, occupation, trade, or business listed in the CLRA Act Schedule.
• The establishment must not be a government establishment.

Exempt From the Requirement CLRA Registration & Licensing

• Establishments that employ contract labourers for less than 15 days in a calendar year
• Establishments that employ contract labourers for work that is incidental to the main work of the establishment
• Establishments that employ contract labourers for work that is seasonal in nature
• Establishments that are located in a Special Economic Zone (SEZ).

Documents Required for CLRA Registration & Licensing

• Trade license
• AOA and MOA or Partnership Deed
• Factory License
• Other certificates of registration, in case of an entity other than the company, proprietorship or partnership firm
• Proof of address
• Proof of identity
• Proof of employment of contract labourers

How crucial is the Contract Labour Regulation and Abolition (CLRA) Act for the principal employer?

The Contract Labour (Regulation and Abolition) Act, 1970 (CLRA Act) is a labour law regulating contract labour employment in India. The Act applies to establishments that employ 20 or more contract labourers on any day of the financial year.

The Principal Employer is the person or entity who engages in contract labour. The Principal Employer has a number of responsibilities under the CLRA Act, including:

• Registering with the appropriate government authority.
• Providing amenities to contract workers, such as canteens, restrooms, and creches.
• Paying contract workers fair wages and overtime.
• Ensuring the safety and health of contract workers.
• Complying with other requirements of the CLRA Act.

Compliances Related to CLRA Registration and Licensing

The compliances related to CLRA Registration and licensing are:

• Registering with the appropriate government authority: The Principal Employer must register with the appropriate government authority in the state where the establishment is located. The registration process can be done online or offline.
• Providing amenities to contract workers: The Principal Employer must provide amenities to contract workers, such as canteens, restrooms, and creches. The type and number of amenities required will depend on the number of contract workers employed by the establishment.
• Paying contract workers fair wages and overtime: The Principal Employer must pay contract workers fair wages and overtime. The wages must be at least equal to the minimum wages prescribed by the government.
• Ensuring the safety and health of contract workers: The Principal Employer must ensure the safety and health of contract workers. This includes providing them with safety equipment and training and ensuring that the work environment is safe.
• Complying with other requirements of the CLRA Act: The Principal Employer must comply with other requirements of the CLRA Act, such as maintaining registers and records and submitting returns.

When Should One Apply for CLRA Registration and Licensing?

One should apply for CLRA registration and licensing as soon as the principal employer starts employing contract labour. This is because the CLRA Act is a legal requirement for any establishment that employs contract labour. Failure to obtain registration and license can result in penalties, such as imprisonment, fine, or both.

In What Cases CLRA Is Not Applicable?

The Contract Labour (Regulation and Abolition) Act, 1970 (CLRA Act) is not applicable in the following cases:

• Where the work is of a casual or intermittent nature and is performed for a period not exceeding 120 days in the preceding twelve months.
• Where the work is of a seasonal character and is performed for a period not exceeding 60 days in a year.
• Where the work is done by members of the family of the principal employer or the contractor.
• the work is done by apprentices under the Apprentices Act 1961.
• Where the work is done by persons employed by a contractor in connection with the construction, repair, maintenance or demolition of any building, civil engineering work or other work of a similar nature, if the total number of persons so employed does not exceed twenty.
• Where the work is done by persons employed by a contractor in connection with the plantation of tea, coffee, rubber, cinchona, cardamom or any other plantation crop, if the total number of persons employed does not exceed twenty.
• Where the work is done by persons employed by a contractor in connection with the running of an engine or machinery used for the generation or distribution of electricity, if the total number of persons so employed does not exceed twenty.

Penalties and Violations of CLRA Registration and License

• Failure to obtain registration and license: Any principal employer who fails to obtain registration and license for employing contract labour can be punished with imprisonment for a term which may extend to three months, or with a fine which may extend to one thousand rupees, or with both.
• Employing contract labour in prohibited establishments: Any principal employer who employs contract labour in an establishment where the employment of contract labour is prohibited can be punished with imprisonment for a term which may extend to six months or with a fine which may extend to two thousand rupees, or with both.
• Contravention of any condition of registration or license: Any principal employer or contractor who contravenes any condition of registration or license granted under the CLRA Act can be punished with imprisonment for a term which may extend to three months or with a fine which may extend to one thousand rupees, or with both.
• Wilful neglect of the provisions of the Act: Any principal employer or contractor who wilfully neglects to comply with any of the provisions of the CLRA Act can be punished with imprisonment for a term which may extend to six months or with a fine which may extend to two thousand rupees, or with both.

Why Vakilsearch?

When it comes to Contract Labour Regulation and Abolition (CLRA) compliance, Vakilsearch offers a host of compelling reasons why we should be your top choice:

1.Expertise in CLRA Compliance: We have a team of experienced legal professionals who specialise in labour laws and regulatory compliance. Our experts are well-versed in the specific requirements and intricacies of CLRA compliance.

2.Efficient Handling: Navigating CLRA regulations can be intricate and time-consuming. Our team can streamline the compliance process, ensuring that all necessary documentation and requirements are met accurately and promptly.

3.Customised Solutions: We recognise that every business has unique CLRA compliance needs. Our services are tailored to address your specific requirements, ensuring that you achieve and maintain compliance effectively.

4.Comprehensive Guidance: We offer end-to-end support, from initial compliance assessments to ongoing adherence. Whether you need assistance with CLRA registration, record-keeping, or managing contract labour, we provide personalised guidance and solutions.

5.Risk Mitigation: Our deep understanding of labour laws allows us to identify potential risks and challenges. We work proactively to mitigate these risks, ensuring that your business operations proceed smoothly and within the bounds of the law.

6.Transparent Pricing: We believe in transparency when it comes to our services and pricing. You'll receive a clear breakdown of costs, making it easier for you to plan your budget for CLRA compliance.

7.Dedicated Customer Support: Our customer support team is committed to providing you with prompt assistance and addressing your inquiries or concerns. Your satisfaction and peace of mind are our top priorities.

8.Proven Track Record: Vakilsearch has a demonstrated history of helping businesses successfully navigate CLRA compliance requirements. Our clients' success stories speak to our competence and reliability in this domain.