Labour Law & Industrial Compliance
Contract Labour (CLRA) Compliance & Wage Liability Calculator
Verify whether your establishment or contractor requires registration under the Contract Labour (Regulation and Abolition) Act, 1970. Calculate state-specific thresholds (20 vs 50 workmen), mandatory welfare amenities (canteen, rest room, creche, first aid), and Section 21(4) Principal Employer liability for unpaid contractor wages, EPF, and ESIC.
Select state where the establishment/work is located
Maximum contract workers engaged on any day in the past 12 months
Expected period of contract engagement
Number of female contract labourers employed
Triggers Section 17 Rest Room compliance if work >= 3 months.
Average gross wage per month per contract worker
Number of months contractor failed to disburse wages (0 if paid)
Total overtime hours worked by all contract workers combined
Outstanding invoice payable to contractor available for legal set-off
Statutory Compliance & Liability Summary
- State Statutory Threshold
- 50 Workmen
- Principal Employer Registration (Sec 7)
- Not Required
- Contractor Licensing (Sec 12)
- Not Required
Under Section 21(4) of the CLRA Act, the Principal Employer is legally bound to disburse all unpaid wages, EPF, and ESIC in full to contract workers upon contractor default. Under Section 23/24, non-compliance attracts prosecution, fines up to ₹1,000 per offence, and imprisonment up to 3 months.
Frequently asked questions
What is the employee threshold for CLRA Act applicability in India?
Under Section 1(4) of the CLRA Act, the default threshold is 20 or more contract workmen employed on any single day in the preceding 12 months. However, several states have raised this threshold to 50 workmen via state amendments, including Maharashtra (2016), Gujarat (2015), Uttar Pradesh (2017), Rajasthan (2014), Andhra Pradesh, and Telangana.
What are the registration requirements for Principal Employers vs Contractors?
Under Section 7, the Principal Employer must obtain a Certificate of Registration (Form I) from the Registering Officer before engaging contract labour. Under Section 12, each contractor deploying contract labour must obtain a Contractor's Licence (Form IV) supported by Form V (Certificate by Principal Employer). Engaging contract labour without registration or licensing is a punishable offence.
What is Section 21(4) Principal Employer liability for contractor wage default?
Section 21(4) explicitly dictates that if a contractor fails to pay wages or statutory contributions within the prescribed period (7th or 10th of every month), the Principal Employer is strictly liable to pay the wages and contributions in full to the contract workers. The Principal Employer can legally recover this disbursed amount by deducting it from pending contractor bills or as a debt from the contractor.
When is a statutory canteen mandatory for contract labour?
Under Section 16 of the CLRA Act, an establishment must provide and maintain a canteen if it employs 100 or more contract workmen and the work is likely to continue for 6 months or more.
When are rest rooms mandatory under Section 17?
Rest rooms are mandatory under Section 17 if contract labour is required to halt at night in connection with the work of the establishment and the work is likely to continue for 3 months or more.
What are the penalties for non-compliance under Sections 23 & 24?
Violations of the CLRA Act, including failure to register or obtain licences, attract imprisonment up to 3 months, or a fine up to ₹1,000, or both. For continuing contraventions, an additional fine up to ₹100 per day may be levied.