Updated on September 03, 2025 12:02:52 PM
In Tamil Nadu, the Contract Labour (Regulation & Abolition) Act, 1970 (CLRA Act) mandates the labor contractor license. It applies to contractors who send 20 or more contract workers to any state establishment. The purpose of this license is to guarantee that contract workers are paid fairly, have adequate working conditions, and receive social security benefits.
Tamil Nadu has a high demand for contract labor because it is a center for industries like manufacturing, construction, textiles, and information technology. Any contractor or agency providing labor to businesses must obtain a Labour Contractor License from the relevant Tamil Nadu Labour Department to continue operating legally. The contractor may be subject to fines, legal penalties, or even suspension of operations if they do not have this license.
Documents such as proof of identity, a PAN card, evidence of business establishment, and the names of the employees are required to be submitted as part of the application process. Section 7 of the CLRA Act requires the Principal Employer to register the business, and Section 12 requires the contractor to obtain a license. The number of employees hired determines the license fee schedule.
Possessing a current labor contractor license not only guarantees compliance but also enhances credibility with clients and government agencies in light of increased regulatory scrutiny. Contractors can seek advice from experts to ensure a smooth registration and registration process.
A labor contractor license is required of any company or contractor that hires individuals under contract for a project or business. It is issued under the Contract Labour (Regulation and Abolition) CLRA Act, 1970, and ensures that companies handle contract workers following applicable labor regulations. A company or contractor that hires 20 or more contract workers per year needs to obtain this license in order to operate legally in India.
The license ensures that workers obtain fair wages, safe working conditions, and all other legal benefits while protecting the company from penalties or legal problems. It also assists businesses in establishing a reputation and maintaining smooth operations free from legal oversight.
Businesses can now register for a labor contractor license more easily and quickly from any place, thanks to online registration for contract labor licenses.
A labor contractor license is required for any contractor, business, or company that hires 20 or more contract workers per year for any project, site, or business activity. This license ensures that businesses manage their workforces under labor laws and was granted under the Contract Labour (Regulation & Abolition) CLRA Act of 1970.
Industries that include manufacturing, construction, cleaning, security, and event planning commonly use contract workers. Any contractor or company in these industries must obtain a Company Labour Contract Licence to operate legally. This license safeguards firms from penalties and legal problems while defending employees' rights by ensuring fair compensation, safe working conditions, and on-time payments.
To apply for a Labour Contractor License in Tamil Nadu , you need to submit the following documents during contract labour licence online registration:
The online registration process for a contract labour license in Tamil Nadu has made it easier to apply for a labour contractor license. Under the Contract Labour (Regulation & Abolition) Act of 1970, any contractor or company that employs 20 or more contract workers is required to obtain a Company Labour Contract Licence. Here’s how you can apply:
Register your establishment with the local labour department, if not already registered.
Visit the official state labour department portal and select the option for Contract Labour Licence Registration.
Fill out the application form (Form IV) with accurate details about the contractor, principal employer, and workers.
Upload required documents – identity proof, address proof, contract copy, worker details, and challan.
Pay the prescribed government fees and security deposit online as per the number of workers.
Submit the application and download the acknowledgment receipt.
Once verified, the labour department will issue the Labour Contractor License online.
The fees for a Labour Contractor License in Tamil Nadu depend on how many workers you hire. As per the Contract Labour (Regulation & Abolition) Act, 1970 (CLRA Act), charges vary based on the number of workers and whether you are applying for a State or Central license.
| Workers | Contract Labour Govt. Fee ₹ | State Establishment Registration Fee ₹ | Central Establishment Registration Fee ₹ |
|---|---|---|---|
| 0 - 50 | ₹ 37.50 | NA | ₹ 150 |
| 51 - 100 | ₹ 150 | ₹ 1,800 | ₹ 300 |
| 101 - 200 | ₹ 300 | ₹ 4,800 | ₹ 600 |
| 201 - 400 | ₹ 300 | ₹ 7,200 | ₹ 1,200 |
| 400 - 800 | ₹ 375 | ₹ 9,000 | ₹ 1,500 |
Note: Professional Fee for Labour Contractor License in Tamil Nadu starts from @5,000.
The aforementioned fees are exclusive of GST.
For contractors and companies employing 20 or more contract workers, obtaining a Tamil Nadu labor contractor license is required. Section 7 of the Contract Labour (Regulation & Abolition) Act, 1970 (CLRA Act) requires principal employers to register their business, while Section 12 requires contractors to obtain a license. Applying is now quick and easy thanks to the online registration process. You can ensure your company operates lawfully, avoid trouble, and establish credibility by paying the necessary government fees, security deposits, and completing the necessary paperwork to defend the rights of your employees.
At Professional Utilities, we leverage our industry knowledge and expertise to help businesses navigate complex regulations, minimize risks, and optimize operations for maximum efficiency and profitability.
According to the CLRA Act, any contractor or business that hires 20 or more contract workers in a year needs to get a license.
The Contract Labour (Regulation & Abolition) Act of 1970 governs the license.
While Section 12 is for labor-supplying contractors, Section 7 is for principal employers registering their business.
Applying online, submitting paperwork, and paying the fee and security deposit are all possible through the Tamil Nadu Labour Department's website.
Required documents include identification, business registration, employee information, a contract, photos, and a fee challan.
If all the paperwork is in order, the license is typically granted in 7–15 working days.
Along with a refundable security deposit, the cost is contingent on the number of employees and whether you are a principal employer or a contractor.
Operating without a license can result in severe fines, legal action, and a prohibition on conducting business.
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