Contract Labour Licence (CLRA) and Principal Employer Registration
A contract labour licence lets a contractor supply workers to your business, and you, as principal employer, must register the establishment before using them. Since 21 November 2025 the OSH Code, 2020 has replaced the CLRA Act, 1970 and set the trigger at 50 contract workers. We handle both sides of the filing on the Haryana Labour Department portal.
What it is
Contract labour means workers you get through a contractor instead of hiring them directly. Your business is the principal employer. The agency that sends your housekeeping or security staff is the contractor. The law asks for two things: the principal employer registers the establishment, and the contractor holds a contract labour licence for the work.
For over five decades these rules sat in the Contract Labour (Regulation and Abolition) Act, 1970, or CLRA: Section 7 for registration and Section 12 for the licence. On 21 November 2025 the Occupational Safety, Health and Working Conditions Code, 2020 (the OSH Code) came into force. It replaced the CLRA Act along with 12 other labour laws.
Haryana’s own rules under the Code were still awaiting finalisation in May 2026, as the Labour Department’s notification of 4 May 2026 records. Meanwhile, the Labour Department’s portal, hrylabour.gov.in, runs the principal employer and contractor workflow, and the licence there is renewed every year.
Who it applies to
Register if 50 or more contract workers come in
Under the OSH Code, the contract labour chapter applies to an establishment where 50 or more contract workers were employed on any day in the past 12 months. The CLRA Act, as Parliament wrote it, used 20.
Take a licence if you employ 50 or more
A contractor who employs 50 or more contract workers needs a licence. Under the Code it can run for five years, or be work-specific and tied to one contract.
Leave out truly casual jobs
Section 1(5) of the CLRA Act kept intermittent or casual work outside. Work done for more than 120 days in the past 12 months, or 60 days a year if seasonal, is not intermittent.
Why it matters
Keep the right to use contract staff
Section 9 of the CLRA Act says an establishment that should be registered but is not cannot employ contract labour at all.
Limit the wage risk you already carry
The contractor pays the wages. If it fails, Section 21 makes the principal employer pay the workers and recover the amount from the contractor, usually from its bills.
Know when amenities fall back on you
The contractor must provide drinking water, latrines, first-aid boxes, rest rooms for night halts and, where 100 or more contract workers are employed, a canteen. If it does not, Section 20 puts the job on the principal employer.
CLRA Act and OSH Code at a glance
| CLRA Act, 1970 | OSH Code, 2020 | |
|---|---|---|
| In force | Until 21 November 2025 | From 21 November 2025 |
| Contract labour threshold | 20 or more workmen (central Act) | 50 or more contract workers on any day in the past 12 months |
| Establishment registration | Section 7, by the principal employer | Section 3, online within 60 days, for establishments with 10 or more workers |
| Contractor licence | Section 12; renewed every year on the Haryana portal | Five-year licence or work-specific licence |
| Existing registrations | Not applicable | Registrations under earlier central labour laws are treated as registered under the Code |
Here is the catch: the count is taken on your busiest day, not as an average. Picture a Faridabad auto-parts unit with 35 housekeeping and loading workers most of the year. It brings in 20 more for a festive-season rush, and on that day it crosses 50.
The Code is the law in force, while the Haryana portal still runs the older principal employer and contractor flow as the state’s rules are pending.
Documents required
From the principal employer
- Shops Act registration on hrylabour.gov.in
- PAN and certificate of incorporation or firm registration
- Each contractor’s name, address, work and maximum headcount
From each contractor
- Shops Act registration, in Haryana or outside
- PAN and GST registration
- Work order or agreement with the principal employer
- Details of the contract workers for the job
For returns and renewal
- Wage, attendance and payment records
- The current licence and registration certificate
- Previous half-yearly and annual returns
- PF and ESI challans for contract workers
How it works
Count your contract workers
We take the highest number of contract workers on any day in the past 12 months, contractor by contractor and in total. Then we test each job for the intermittent-work exclusion.
Put the Shops Act login in place
The Haryana portal works off your Shops Act registration. Both the principal employer and every contractor need it first.
Register the establishment and add contractors
The principal employer applies and adds each contractor. Once the Labour Department approves, the principal employer activates Form 5 for each contractor.
File the contractor’s licence application
The contractor applies for a fresh licence through the link the principal employer sends. The portal works out the fee from the number of workers, and it can be paid online or by treasury challan.
Keep registers, file returns and renew
We put the renewal and returns on the compliance calendar we run for you. In practice, the returns are only as good as the wage records, so we tie them to your payroll and statutory compliance.
Timelines
Register within 60 days under the OSH Code
Section 3 asks for an online application within 60 days of the Code applying to the establishment. If the registering officer does not act in time, the establishment is deemed registered.
Report changes and closure within 30 days
A change in ownership or management goes to the registering officer within 30 days. On closure, the employer informs the officer within 30 days and certifies that workers’ dues are paid.
Renew every year and file returns
The Haryana portal renews licences annually. Under the CLRA Central Rules, 1971, the contractor files a half-yearly return in Form XXIV and the principal employer an annual return in Form XXV.
What happens if you skip registration
You cannot lawfully use contract labour
Under Section 9 of the CLRA Act, an establishment that has not registered when it should have cannot employ contract labour, whoever supplies the workers.
You face prosecution under Section 23
Breaking the rules on employing contract labour can mean imprisonment of up to three months, a fine of up to ₹1,000, or both. A continuing breach adds up to ₹100 for each day after conviction.
You pay the wages the contractor skipped
Section 21 makes the principal employer pay unpaid wages and then recover them from the contractor. Recovery is far easier when the contractor is licensed and its wage records are on file.
Frequently asked questions
How many contract workers trigger the contract labour licence now?
The trigger is 50 contract workers under the OSH Code, 2020, in force since 21 November 2025. The contract labour chapter applies to an establishment, or a contractor, that employed 50 or more contract workers on any day in the past 12 months. The older CLRA Act, as enacted by Parliament, used a figure of 20. We count your peak day for each contractor and in total before anything is filed.
Who applies, the principal employer or the contractor?
Both, for different things. The principal employer registers the establishment, and the contractor obtains the contract labour licence. On the Haryana portal the principal employer adds each contractor and, after the Labour Department approves, activates Form 5 for that contractor. The contractor then applies for its licence through the link it receives. We can file for both sides, so the two applications move together.
Is the CLRA Act still in force after the labour codes?
No, the OSH Code replaced the CLRA Act on 21 November 2025, along with 12 other labour laws. Registrations under earlier central labour laws are treated as registrations under the Code by Section 3. Haryana’s own rules under the Code were still awaiting finalisation in May 2026, and the state portal still runs the principal employer and contractor workflow. We confirm the current route with the department before each filing.
How long is a contract labour licence valid?
On the Haryana Labour Department portal, contract labour licences are renewed every year. Under the OSH Code, a contractor can hold either a five-year licence or a work-specific licence for a particular contract. Haryana’s final rules will settle which applies here. We track the renewal date for you and file well before it, so work on site never has to pause.
What returns have to be filed?
Two, under the CLRA Central Rules, 1971. Every contractor files a half-yearly return in Form XXIV, and every principal employer of a registered establishment files an annual return in Form XXV with the registering officer. Under the OSH Code, an employer must also report changes in ownership or management, and closure, within 30 days. We prepare the returns from your wage and attendance records, so the figures always agree.
Does a short painting or repair job need a licence?
Usually not, if the work is truly intermittent or casual. Section 1(5) of the CLRA Act kept such work outside the Act, but work done for more than 120 days in the past 12 months, or more than 60 days a year for seasonal work, is not intermittent. Say a Gurugram office hires painters for three weeks once a year: that is intermittent. Its security agency, on duty every day, is not. We review each contract for you.
Who pays if the contractor does not pay wages?
The principal employer does, under Section 21 of the CLRA Act. The contractor must pay wages, but if it fails, the principal employer pays the workers and recovers the amount from the contractor’s bills or as a debt. Picture a Faridabad warehouse whose loading contractor leaves owing two months’ wages. The warehouse pays first. Monthly checks of the contractor’s wage sheets in your books of account keep that rare.
What is the penalty for using contract labour without registration?
Section 23 of the CLRA Act allows imprisonment of up to three months, a fine of up to ₹1,000, or both. A continuing breach can add up to ₹100 a day after conviction. Separately, Section 9 says an unregistered establishment cannot employ contract labour at all. Register, get your contractors licensed and keep the records, and inspections become routine.
Do we need Shops Act registration first in Haryana?
Yes. The Haryana Labour Department’s FAQ says an applicant must first be registered under the Shops Act before applying for contract labour licensing. Users already on the portal simply log in with their existing ID. A contractor based outside Haryana can also be added, provided it holds Shops Act registration. If you do not have the Shops Act record yet, we file that first and then move on to contract labour.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
On the Haryana Labour Department portal, the government fee for a contract labour licence is calculated automatically from the number of workers. It can be paid online or by treasury challan.
Ready to begin?
Send us your contractor list and your busiest day’s headcount. We will get the registration and licences filed on the Haryana portal.