CLRA Compliance for Principal Employers and Contractors

Principal employer

• Hold a current registration certificate listing every contractor and correct workmen numbers.
• Issue Form V for each contractor and each work order.
• Collect monthly wage sheets, PF and ESI challans and ECRs from every contractor.
• Nominate a representative to witness wage payment where required.
• Maintain the register of contractors and file the annual return.

Contractor

• Hold a valid licence for each establishment and keep it amended.
• Maintain the register of workmen, muster roll, wage register, wage slips and deduction register.
• Pay at least the notified minimum wage within the wage period.
• Deposit PF and ESI for all deployed workers on time.
• File the half-yearly return as prescribed.

Monthly vendor compliance pack

The most reliable control is a fixed monthly document pack from each contractor — wage sheet, attendance, PF ECR and challan, ESI return and challan, and a compliance declaration. Withholding the invoice until the pack is received is far more effective than a contractual indemnity.

Frequently asked questions

Is the principal employer liable if a contractor does not pay wages?

Yes. The principal employer can be required to pay the wages and recover them from the contractor.

What returns are filed under CLRA?

Contractors file half-yearly returns and principal employers file an annual return, in the forms prescribed by the applicable rules.

Sources & references

• Shram Suvidha Portal — Government of India
• India Code — Central Acts