Labour License Registration

Overview

Two licenses, one obligation

Under the Contract Labour (Regulation & Abolition) Act, any establishment employing contract workers above the prescribed threshold (commonly 20, though some states set it lower) must obtain registration as a principal employer, while the contractor supplying that labour must separately hold a labour license. Both are state-administered and both are commonly checked during labour inspections.

Mandatory under the Contract Labour Act

Both principal employers and contractors are legally required to register once the worker threshold is crossed — there's no way around it.

Avoids penalties and business disruption

Operating without the required license invites fines, prosecution, and can halt contract work at a site altogether.

Ensures welfare compliance

Registration ties into wage, safety, and welfare obligations for contract workers, reducing the risk of disputes and inspection issues.

Try it now

See your estimated tax in seconds

A quick estimate to get you started — for the exact threshold and process in your state, book a consultation

Tax regime

Annual income (₹)

₹

₹0₹25L₹50L+

Estimated tax payable

₹ 97,500

Effective rate 6.5% · new regime on ₹15,00,000

Taxable income₹ 14,25,000

Tax as per slabs₹ 93,750

Health & education cess (4%)+₹ 3,750

The New Regime saves you ₹ 1,59,900 compared to the Old Regime.

Illustrative estimate for FY 2025-26 — assumes salaried income eligible for the standard deduction, and includes the Section 87A rebate and 4% cess. Surcharge is applied at a flat rate without its own marginal relief. Does not account for other deductions or individual circumstances. Book a consultation for an exact figure.

Simple, from start to finish

How it works

Book a consultation

We confirm whether your contract workforce crosses the threshold requiring registration or a license.

Share your documents

Securely upload incorporation, worker, and contractor details, guided step by step.

We file with the labour department

Your application — as principal employer, contractor, or both — is prepared and submitted.

License issued

Your Labour License or Registration Certificate is issued, and we outline the renewal schedule.

Typically 10–15 working days (varies by state)

Questions

Frequently asked

01At what number of workers does this become mandatory?

Most states set the threshold at 20 or more contract workers, though some states have lowered it to 10 — we confirm the exact figure that applies to your state and industry.

02Do I need a separate license as the contractor and the principal employer?

Yes. The principal employer obtains a Registration Certificate for the establishment, while each contractor supplying labour separately obtains their own Labour License.

03What's the penalty for not registering?

Non-compliance can lead to fines, prosecution of the employer or contractor, and in practice often halts contract labour deployment at the site until the license is in place.

04Does the license need to be renewed?

Yes, typically annually — the license specifies the number of workers and duration it covers, and needs renewal before expiry to stay valid.

05Why book a consultation instead of registering myself?

Getting the worker count, threshold rules, and the employer-vs-contractor distinction wrong is the most common reason applications get rejected or licenses come up short during inspection. We make sure the right party applies for the right license.

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