Labour Licence Online Registration (Contract Labour Licence)
eFileSeva offers specialized, end-to-end assistance for obtaining your Labour Licence under the Contract Labour (Regulation & Abolition) Act, 1970. Whether you are a manpower contractor, a construction firm, or a service provider, we help you secure the necessary approvals from the Office of the Licensing Officer (Labour Department). Our experts handle everything from Form V procurement and document verification to application filing and final licence issuance.
As per statutory regulations, any contractor employing 20 or more workmen (threshold varies by state, e.g., 50 in some regions) on any day of the preceding 12 months must obtain a Contract Labour Licence. This licence is a prerequisite for bidding on corporate or government tenders, ensuring statutory compliance, and protecting your firm from heavy penalties and legal litigation. It serves as vital proof of your business's legitimacy for PF & ESIC registrations and professional contract executions.
The registration process requires the submission of the Form V (Certificate by Principal Employer), details of the nature of work, number of labourers, and security deposit payments. We simplify the complexities of the Shram Suvidha Portal and various State Labour Portals (like Delhi, Maharashtra, Karnataka, and UP), ensuring your application is error-free for fast-track processing and annual renewals.
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Key Details for Labour Licence Registration (Contract Labour Licence)
eFileSeva provides comprehensive professional assistance for obtaining a Labour Licence under the Contract Labour (Regulation & Abolition) Act, 1970. We facilitate the entire process—from obtaining Form V from the Principal Employer to final submission on the Shram Suvidha or State Labour portals—ensuring manpower contractors and construction firms remain fully compliant with statutory labour laws.
| # | Topic | Details |
|---|---|---|
| 1 | What is a Labour Licence? | A mandatory legal authorization required by contractors under the CLRA Act, 1970 to employ contract labour. It ensures that the contractor provides basic amenities and follows statutory regulations regarding wages and working conditions. |
| 2 | Registration Timeline | Application processing and document verification usually take 7 to 15 working days, depending on the response time of the Licensing Officer and the specific State or Central Labour Department portal. |
| 3 | Applicability Threshold | Mandatory for any contractor who employs 20 or more workmen (or 50 in certain states like Maharashtra) on any day of the preceding 12 months. Without this, the employment of contract labour is considered illegal. |
| 4 | Role of Form V | The Form V (Certificate by Principal Employer) is the most critical document. It is issued by the company (Principal Employer) hiring the contractor, certifying that they have engaged the contractor for a specific work order. |
| 5 | Security Deposit Requirement | Contractors are required to pay a refundable security deposit per labourer (amount varies by state/central rules) at the time of application. This deposit is held by the Labour Department to ensure wage protection. |
| 6 | Central vs. State Licence |
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| 7 | Mandatory Documents |
Standard documentation includes:
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| 8 | Penalty for Non-Compliance | Operating without a valid Labour Licence can lead to imprisonment up to 3 months, heavy financial fines, or the blacklisting of the contractor from future government and corporate tenders. |
| 9 | Validity & Renewal | Typically valid for one year or for the duration of the specific contract. Renewal applications must be filed at least 30 days before the expiry of the current licence. |
| 10 | Related Compliance Services |
eFileSeva also assists with critical labour-related compliances:
EPF & ESIC Registration
Professional Tax (PT) Registration
Principal Employer RC Registration
BOCW Registration (Construction)
Annual Labour Return Filing
Maintenance of Muster Rolls & Registers
Workmen Compensation (WC) Insurance
Shop Act (Gumasta) for Head Office
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Labour Licence (Contract Labour Registration) in India: Everything You Need to Know
Secure Your Contract Labour Licence (CLRA) with Expert Support
Obtaining a Labour Licence under the Contract Labour (Regulation & Abolition) Act, 1970 is a mandatory requirement for contractors who provide manpower or services to other establishments. Regulated by the Central or State Labour Departments, this licence ensures that the contractor is legally authorized to employ workmen and adheres to statutory standards regarding wages, welfare, and safety.
Under the CLRA Act, any contractor employing 20 or more workmen (this threshold is 50 in states like Maharashtra and Bihar) on any single day of the preceding year must obtain this registration. This applies to manpower agencies, security services, housekeeping firms, construction contractors, and outsourcing companies. Similarly, the Principal Employer (the company hiring the contractor) must also obtain a Registration Certificate (RC).
A valid Labour Licence is a critical prerequisite for participating in corporate and government tenders. It serves as primary proof of statutory compliance required by clients before releasing payments. Furthermore, it is essential for the smooth processing of EPF (Provident Fund) and ESIC (Employee State Insurance) contributions for the contract staff deployed at various sites.
The application process heavily relies on Form V (Certificate by Principal Employer), which establishes the formal link between the contractor and the hiring entity. Along with Form V, contractors must submit details of the nature of work, the maximum number of workers to be employed, proof of business registration, and the payment of a refundable security deposit to the Labour Department.
Licences are generally issued with a validity of 12 months or for the specific duration of the work order/contract. Renewals must be filed at least 30 days prior to the expiry to avoid lapses in legality. Operating without a valid licence can lead to severe penalties, prosecution, and the immediate termination of the service contract by the Principal Employer.
Beyond the licence, contractors are legally bound to maintain various Statutory Labour Registers, including the Muster Roll, Register of Wages, Register of Deductions, and Register of Overtime. They must also ensure timely filing of Annual Returns on the Shram Suvidha Portal or respective State Labour Portals.
eFileSeva simplifies the complexities of labour laws by handling your Labour Licence application from start to finish. We assist in Form V procurement guidance, security deposit calculations, portal filings, and timely renewals, ensuring your contracting business remains 100% compliant and ready for growth.
Arjun Mehra
Managing Director, Security & Manpower Services
"We secured a major facility management contract but needed a Central Labour Licence within a tight deadline to start deployment. eFileSeva managed the Shram Suvidha filing and security deposit process flawlessly. Their expertise in CLRA compliance is unmatched!"
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Key Benefits & Uses of Labour Licence (Contract Labour Registration)
A Labour Licence, issued under the Contract Labour (Regulation & Abolition) Act, 1970, is a mandatory statutory permit for contractors employing 20 or more workers. Securing this licence ensures your manpower or construction business operates within the legal framework of the Labour Department, provides protection against prosecution, enables participation in large-scale tenders, and ensures seamless payment processing from Principal Employers.
Tender & Bidding Eligibility
Acts as a primary qualifying document for contractors bidding on Government (CPWD, Railways) and private corporate tenders.
- Mandatory for Central/State Govt. contracts
- Requirement for B2B service agreements
- Proves operational scale and legitimacy
Legal Protection & Immunity
Protects the business owner from severe penalties, work-stop orders, and imprisonment resulting from CLRA Act violations.
- 100% compliance with Labour Commissioner rules
- Avoids blacklisting by Principal Employers
- Prevents closure notices from Labour Inspectors
Smooth Payment Clearance
Most Principal Employers mandate a valid Labour Licence to release monthly contractor bills and security deposits.
- Ensures timely reimbursement of wages
- Validates the specific work order (Form V)
- Simplifies annual financial audits
Social Security Alignment
A Labour Licence is essential for managing the social security benefits of a large workforce across different sites.
- Facilitates EPF and ESIC site-wise tracking
- Ensures insurance coverage for workmen
- Protects contractor from liability in accidents
Worker Welfare Standards
Statutory framework that mandates basic amenities, preventing exploitation and ensuring a healthy workforce.
- Ensures drinking water & first-aid facilities
- Regulates rest rooms & canteen facilities
- Standardizes wage payment dates & modes
Contractor Credibility
Holding a valid Labour Licence signals to multinational companies that your firm is ethical and legally compliant.
- Demonstrates long-term business stability
- Builds high trust with B2B enterprise clients
- Attracts better work orders and skilled labor
Important Statutory Note:
Under the Contract Labour (Regulation & Abolition) Act, 1970, contractors must obtain a licence if they employ 20 or more workmen (threshold is 50 in specific states like Maharashtra). A prerequisite for this application is the Form V issued by the Principal Employer. Contractors are also required to pay a security deposit per worker, which is refundable upon contract completion. Labour Licences are typically valid for 12 months or the duration of the work order and must be renewed 30 days before expiry to avoid statutory lapses.
Eligibility & Requirements for Labour Licence (Contract Labour Registration)
Understand the statutory eligibility criteria, mandatory documents, and CLRA Act requirements before applying for your Labour Licence with eFileSeva.
Eligible Contracting Entities
Labour Licence registration applies to all entities providing manpower or services through contract labour, including Sole Proprietorships, Partnerships, Private Limited Companies, and LLPs acting as contractors for Principal Employers in the private or public sector.
Employee Threshold (The 20-Workmen Rule)
A licence is legally mandatory for any contractor who employs 20 or more workmen (or 50 in specific states like Maharashtra and Bihar) on any single day of the preceding 12 months for a specific contract or work order.
Form V (Certificate from Principal Employer)
The most critical requirement is the Form V, issued by the Principal Employer (the client). This certificate confirms that your firm has been awarded a contract and authorizes you to apply for a licence to deploy a specific number of labourers at their site.
Contractor & Project Documentation
- KYC Documents: PAN, Aadhaar, and Photos of the Proprietor/Directors.
- Work Order: A copy of the formal agreement or letter of intent from the client.
- Office Proof: Electricity bill or Rent Agreement of the contractor's registered office.
Refundable Security Deposit
Applicants must pay a security deposit per worker (as per Central or State rules) to the Labour Department. This deposit is refundable upon the successful completion of the contract and submission of a clearance certificate showing all wages and dues were paid.
Central vs. State Jurisdiction
• Central Licence: Required if the work is for Railways, Mines, Banks, Insurance, or Central Govt. Depts.
• State Licence: Required for work in private factories, construction sites, and state-level projects.
Registration Timing & Deadlines
The contractor must apply for the licence before the commencement of work or as soon as the threshold of 20 workers is reached. Operating without a licence during an active contract is a punishable offence under Section 23 of the CLRA Act.
Validity & Annual Renewals
Labour Licences are typically valid for 12 months or for the duration of the contract specified in Form V. Renewal applications must be submitted 30 days before the expiry date to ensure uninterrupted legal operations at the project site.
eFileSeva Labour Licence Assistance
eFileSeva manages the complex CLRA licensing process—from helping you draft the request for Form V to security deposit calculation, portal filing on Shram Suvidha, and maintaining the mandatory statutory registers required for labour audits.
Ready to Apply for your Labour Licence?
eFileSeva provides expert assistance for Central and State Labour Licences (CLRA) with guaranteed compliance and fast-track processing for contractors.
Start Application NowDocuments Required for Labour Licence (Contract Labour Registration)
eFileSeva helps you prepare and verify the mandatory documentation required for a Labour Licence under the CLRA Act, 1970. The process involves coordination between the Contractor and the Principal Employer. Our experts ensure your Form V, work orders, and statutory payment challans are perfectly aligned with Central or State Labour Department requirements to avoid application rejections.
Contractor KYC
Identity credentials of the individual contractor, managing partner, or authorized director.
- Aadhaar Card and PAN Card of the Contractor/Promoter
- Passport-size photograph of the Applicant
- Active Mobile Number & Email ID for Shram Suvidha OTPs
- Board Resolution or Authorization Letter for the signatory
Contracting Firm Details
Statutory business proofs of the contracting agency or service providing firm.
- Firm PAN Card and GST Registration Certificate
- COI / Partnership Deed / LLP Agreement
- MSME Udyam Certificate (if available)
- Registered Office Address Proof (Electricity bill/Rent Agreement)
Form V (Principal Employer)
The non-negotiable certificate issued by the hiring company (Principal Employer).
- Original Form V signed and stamped by the Principal Employer
- Registration Certificate (RC) number of the Principal Employer
- Work Order or Letter of Intent (LOI) issued by the client
- Name, designation, and contact details of the PE representative
Contract Scope
Operational details of the work to be performed at the site.
- Nature of work (e.g., Security, Civil Works, Housekeeping, Manpower)
- Specific location address where the contract labour will be deployed
- Date of commencement and estimated date of completion of work
- Contract value and billing cycle details (for office records)
Statutory Proofs
Details required for security deposit and worker welfare.
- Maximum number of workmen proposed to be employed on any day
- Proof of payment of Licence Fees and Security Deposit (Challans)
- EPF (Provident Fund) Registration code and ESIC Code of the firm
- LIN (Labour Identification Number) from Shram Suvidha Portal
Timeline for Labour Licence Registration (Contract Labour Licence)
The Labour Licence application process is managed digitally through the Shram Suvidha Portal (for Central jurisdiction) or individual State Labour Portals. The workflow requires coordination between the contractor and the Principal Employer. While document preparation and filing happen quickly, the official approval by the Licensing Officer typically takes 7 to 15 working days, depending on the state's scrutiny process and security deposit verification.
Form V & Work Order Vetting
We assist you in obtaining the mandatory Form V from your Principal Employer. We review your Work Order, contractor KYC, and existing EPF/ESIC registrations to ensure all details align perfectly before portal submission.
Portal Filing (Form VI)
We create your profile on the Shram Suvidha Portal or State Labour site to generate your LIN (Labour Identification Number). The application for the licence (Form VI) is drafted, and all statutory documents are uploaded.
Security Deposit & Scrutiny
We calculate the required refundable security deposit based on your worker count and facilitate the online payment. The application then moves to the Licensing Officer for detailed verification and departmental review.
Licence Grant & Compliance
The official Labour Licence is issued digitally with a QR code. eFileSeva then provides you with the mandatory formats for Labour Registers (Muster Roll, Wage Register) to ensure you are 100% audit-ready.
Important Timeline & Regulatory Note:
The processing time for a Labour Licence is subject to the responsiveness of the Licensing Officer in your specific jurisdiction. Central Labour Licences (for Railways, Mines, etc.) may involve more rigorous scrutiny than state-level licences. Please note that a licence is typically valid for 12 months or the duration of the work order; renewal applications must be submitted 30 days prior to expiry. eFileSeva tracks these deadlines for you to prevent any legal lapses in your manpower deployment.
Process for Labour Licence Registration (Contract Labour Licence) in India
The Labour Licence process is a statutory digital workflow governed by the Contract Labour (Regulation & Abolition) Act, 1970. It is legally mandatory for any contractor employing 20 or more workmen (50 in specific states) to obtain this licence before commencing work at a client’s site. The process requires a tripartite coordination between the Contractor, the Principal Employer (via Form V), and the Labour Commissioner’s Office. eFileSeva manages the entire lifecycle, from LIN generation and security deposit payment to the final issuance of the Licence (Form VI).
Jurisdiction & Worker Count Assessment
We begin by determining if your project falls under Central Jurisdiction (Railways, Mines, Banking) or State Jurisdiction (Construction, Manufacturing, Services). We assess your peak worker count to verify if you meet the statutory threshold of 20 or 50 workers required for mandatory licensing.
Form V Procurement & Documentation
We assist you in obtaining the mandatory Form V (Certificate by Principal Employer) from your client. Simultaneously, we verify your Work Order, contractor KYC, Registered Office proofs, and EPF/ESIC registration codes to ensure the application is robust and query-free.
Shram Suvidha / State Portal Registration
We create your profile on the Shram Suvidha Portal (Central) or the respective State Labour Portal. We generate your unique LIN (Labour Identification Number), draft the Form VI application, and upload the signed Form V along with project-specific details.
Security Deposit & Fee Remittance
We facilitate the online payment of the refundable security deposit (calculated per worker) and the government licence fees via the Bharatkosh or State Treasury gateway. This deposit is vital for the protection of workmen's wages and is refundable upon contract completion.
Departmental Scrutiny & Licence Grant
The application is reviewed by the Licensing Officer / Assistant Labour Commissioner. Once the scrutiny of Form V and the Work Order is complete, the official Labour Licence (Form VI) is digitally issued, featuring the specific worker capacity and contract duration.
Ongoing Statutory Record Maintenance
Post-licensing, eFileSeva provides you with mandatory templates for Labour Registers (Muster Roll, Register of Wages, Register of Overtime). We also assist with Half-Yearly/Annual Returns and timely renewals to ensure your billing with the Principal Employer remains uninterrupted.
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Registrations & Compliances Required After Obtaining a Labour Licence
Securing your official Labour Licence (Form VI) under the CLRA Act, 1970 is the primary legal milestone for manpower and service contractors. However, operating as a compliant contractor requires ongoing adherence to Central and State Labour Laws, Social Security Norms, and Industrial Safety Regulations. To protect your business from work-stop orders, blacklisting by Principal Employers, or severe litigation, you must manage these key post-registration compliances and ancillary registrations diligently.
| Registration / Compliance | When You May Need It | Key Benefit / Purpose |
|---|---|---|
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Licence Renewal & Amendments
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30 Days Before Expiry (usually annual) or when increasing the worker count beyond the licensed limit. | Prevents the licence from lapsing, ensures legal continuity at the project site, and avoids heavy late-filing penalties. |
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EPFO & ESIC Monthly Filings
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Monthly (by the 15th) for all contract workers deployed at the site. | Mandatory for clearing contractor bills with Principal Employers; ensures workers receive social security, medical, and pension benefits. |
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GST Registration & Invoicing
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Immediately for B2B contracting or when turnover exceeds ₹20 Lakhs. | Enables tax-compliant billing to clients, collection of GST, and claiming Input Tax Credit (ITC) on equipment and materials. |
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MSME / Udyam Registration
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For Contracting Firms seeking credit facilities and payment protection. | Protects against delayed payments (45-day rule) from large corporate clients and provides access to lower interest rates on working capital. |
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Professional Tax Compliance
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Mandatory in states like Maharashtra and Karnataka for both the firm (PTEC) and salary deductions (PTRC). | Statutory tax obligation for service providers; non-payment results in compounding interest and potential notice from state tax authorities. |
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BOCW Act Registration
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If the contract involves construction, demolition, or repair work with 10 or more workers. | Specific welfare registration for construction workers; ensures payment of BOCW cess and provides specialized accident insurance. |
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Workmen Compensation (WC) Policy
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Before deploying labour at any client site, regardless of headcount. | Protects the contractor from financial liability in case of workplace accidents, injuries, or fatalities at the site. |
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Labour Registers Maintenance
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Daily (Muster Roll, Wage Register, Overtime Register, Fine Register). | Legal evidence required during Labour Inspector audits and for the clearance of final dues/security deposits from the department. |
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Unified Annual / Half-Yearly Return
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Filing on the Shram Suvidha Portal at the end of every financial year/contract half-year. | Reports total workforce, wages paid, and welfare facilities provided; mandatory to maintain a "Good Standing" status for future tenders. |
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Shop Act (for Head Office)
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For the Contractor's own administrative office location. | Basic legal proof of the firm's physical address; required for banking, GST, and municipal commercial permits. |
Licensed Labour Contractor (CLRA) vs Unlicensed Contractor: Why Statutory Compliance Matters
Obtaining a mandatory Labour Licence under the Contract Labour (Regulation & Abolition) Act, 1970 is the fundamental legal requirement for any contractor employing 20 or more workmen (50 in specific states). While operating without a licence exposes both the contractor and the Principal Employer to criminal prosecution, imprisonment, and heavy fines, a licensed firm secures the right to bid for large-scale tenders, ensures smooth payment clearances, and builds long-term corporate credibility. Compare the key differences below to see why CLRA compliance is the backbone of a professional contracting business versus a high-risk informal agency.
| Feature | Licensed Contractor (CLRA Compliant) | Unlicensed / Non-Compliant Contractor |
|---|---|---|
| 1. Legal Authority to Hire |
Statutorily Authorized
Legally permitted by the Licensing Officer (Labour Dept) to deploy a specific number of workmen at the client site. |
Illegal Labour Deployment
Violates Section 12 of the CLRA Act; employment of contract labour is considered a criminal offense punishable by law. |
| 2. Tender & Bidding Eligibility | Unlimited Market Access: Qualified to bid for Government (Railways, CPWD, NHAI) and large MNC tenders that mandate a valid Labour Licence. |
Disqualified from Bidding
Blocked from professional tenders; restricted to small, unorganized sub-contracts with zero growth potential. |
| 3. Billing & Payment Clearance | Guaranteed Payment Flow: Principal Employers release monthly payments and security deposits without delay upon submission of the Licence copy. |
Payments Withheld
Corporate clients strictly freeze contractor billing and payments during audits if a valid Labour Licence is not produced. |
| 4. Statutory Penalties & Jail | Legal Immunity: Shielded from prosecution as long as licence conditions and worker welfare norms are maintained. |
Prosecution & Imprisonment
Proprietors/Directors face up to 3 months imprisonment and heavy compounding fines under Section 23 & 24 of the Act. |
| 5. Principal Employer (PE) Safety | Protects the Client: The Principal Employer remains safe from legal liability for the contractor’s staff deployment. | Exposes the Client: The company hiring an unlicensed contractor is also liable for prosecution, leading to immediate contract termination. |
| 6. Social Security Alignment | Seamless PF/ESIC Management: Enables correct mapping of workmen for Provident Fund and ESI benefits, essential for annual labour audits. | Social Security Lapses: Difficulty in managing employee benefits, leading to additional notices from EPFO and ESIC departments. |
| 7. Audit Readiness | Transparency: Maintains mandatory Muster Rolls, Wage Registers, and Overtime logs as per the statutory Form VI conditions. | Audit Failure: Lacks legal documentation, making the firm defenseless during surprise inspections by Labour Enforcement Officers. |
| 8. Business Scalability |
High Growth Potential
Builds a reputation as a compliant, ethical manpower partner, enabling multi-state expansion and large-scale workforce management. |
Stuck in the informal sector; faces constant risk of blacklisting and operational closure due to regulatory non-compliance. |
| 9. Cost vs. Risk | Fixed Statutory Fee: Nominal government fees and a refundable security deposit to secure long-term legality. | Saves on initial fees but risks losing the entire security deposit, paying massive legal costs, and permanent business shutdown. |
| 10. Best Suited For | Security Agencies, Housekeeping Firms, Civil Contractors, Facility Managers, and Manpower Outsourcing Agencies. | Informal labor providers who risk their livelihood and their workers' welfare by avoiding statutory registration. |
Ready to Secure Your Labour Licence?
Get expert assistance from eFileSeva for Contract Labour Registration (CLRA) — from Form V procurement and security deposit calculation to Shram Suvidha portal filing and annual compliance tracking.
Talk to a Labour Law ExpertFrequently Asked Questions
Find answers to common questions about Labour Licence (Contract Labour Registration) in India, including CLRA Act rules, worker threshold limits (20 or 50 staff), Form V requirements, security deposits, application timelines, and licence renewal processes.
- Form V: Original certificate from the Principal Employer.
- Work Order: Copy of the contract or letter of intent.
- Contractor KYC: PAN, Aadhaar, and Photo of the Proprietor/Director.
- Entity Proof: Partnership Deed or Certificate of Incorporation (COI).
- Security Deposit: Proof of online payment (Challan) for the security deposit and licence fees.
- Central Licence: Required for projects under Central Government jurisdiction, such as Railways, Mines, Banking, Insurance, or Ports. Applications are filed on the Shram Suvidha Portal.
- State Licence: Required for private sector projects, local construction, and state-level works. Applications are filed on the respective State Labour Portals.
Still Have Questions?
Talk to the eFileSeva team for expert guidance on Labour Licence Registration (CLRA) — assisting with Form V procurement, security deposit calculation, portal filings, and statutory labour audits across India.
Talk to a Labour Law ExpertTrusted by 10,000+ Contractors for Labour Licence Registration in India
Manpower Agencies, Construction Firms, Security Services, and Facility Managers across India rely on eFileSeva for professional Labour Licence Registration (CLRA) — including Form V procurement assistance, security deposit facilitation, Shram Suvidha portal filings, and ensuring your business is 100% tender-ready and audit-compliant.
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