What the template contains
- Header block: agency legal name, GSTIN, contract labour licence number (plus PSARA licence for security staffing), client and principal employer name and GSTIN, state of deployment, wage period, effective date and validity
- Worker category table: designation, skill classification (unskilled, semi-skilled, skilled, highly skilled), site location and headcount per category
- Wage build-up per category: basic plus dearness allowance set to the applicable state minimum wage, HRA and other allowances, and the monthly gross wage
- Employer statutory cost block: EPF employer share, ESI employer share, bonus provision, gratuity provision and paid leave provision, spelled out line by line
- Employee deduction reference: EPF and ESI employee shares shown separately so the client sees take-home against cost
- Cost to company subtotal per worker and per category
- Service charge or management fee line, shown as a percentage and a rupee value
- Pre-tax subtotal per worker and for the deployment
- GST line: 18% on the full taxable value, split as CGST plus SGST for intra-state or IGST for inter-state supply, with SAC 9985
- All-in bill rate per worker per month and the derived per-day rate
- Notes and clauses section: statutory revision clause, TDS treatment, reverse charge note for security services, payment terms and the principal employer liability reminder
How to use it
- Pick the state of deployment first and pull that state's currently notified minimum wage for each skill category; set basic plus DA to at least that figure and never below the Central floor wage for the area
- Structure the pay so the components that count as wages (basic, DA, retaining allowance) are not artificially suppressed; if allowances kept outside wages cross one half of total remuneration, add the excess back into wages before computing contributions
- Calculate each employer statutory cost on the correct base: EPF and bonus on wages, ESI on gross wages up to the Rs 21,000 monthly ceiling, gratuity as a monthly provision, and paid leave as one day for every twenty days worked
- Add the agency service charge as a clearly stated percentage of the cost to company, not a hidden markup buried inside the wage
- Apply GST at 18% (SAC 9985) on the full pre-tax subtotal, choosing CGST plus SGST or IGST by place of supply; for security services flag that the client may pay GST under reverse charge
- State on the card that the client will deduct TDS under Section 194C on the invoice value and that the rate auto-revises when minimum wage or statutory rates change
- Share the completed card for client sign-off, keep the signed version with the service agreement, and reissue it whenever a statutory input changes rather than absorbing the increase
Key fields and clauses
| Field or clause | What to put |
|---|---|
| Agency identifiers | GSTIN and contract labour licence number (plus PSARA licence for security), so the client can verify the firm is licensed to supply labour. |
| Skill category and minimum wage base | Each role tied to the state notified minimum wage, which cannot be set below the Central floor wage. |
| Wage definition line | Basic plus DA plus retaining allowance are wages; the one-half cap adds excess allowances back so contributions are not understated. |
| EPF employer contribution | 12% of wages plus administrative and EDLI charges, with 8.33% routed to pension subject to the pension wage ceiling. |
| ESI employer contribution | 3.25% of gross wages, applied up to the Rs 21,000 monthly wage ceiling (Rs 25,000 for persons with disability). |
| Bonus provision | Minimum 8.33% and maximum 20% of wages under the Code on Wages, costed into the rate. |
| Gratuity provision | 15 days wages for each completed year (factor 15/26); fixed-term workers accrue pro-rata without the 5-year condition. |
| Paid leave provision | One day of leave with wages for every twenty days worked, treated as a statutory cost element. |
| Service charge | The agency margin, stated as an explicit percentage separate from wages and statutory costs. |
| GST at 18% (SAC 9985) | Charged on the full billed value, as CGST plus SGST or IGST by place of supply. |
| Reverse charge note (security services) | Where the supplier is not a body corporate and the recipient is registered, the client pays GST under RCM. |
| TDS clause | Client deducts TDS under Section 194C, 1% for individual or HUF suppliers and 2% otherwise, subject to thresholds. |
| Statutory revision clause | The rate revises automatically from the effective date of any notified change in minimum wage or contribution rates, so increases are not absorbed by the agency. |
| Principal employer liability note | Reminds the client that under the OSH Code the principal employer must pay contract labour wages if the contractor defaults and may recover from the contractor. |
Why this document matters
This rate card exists because a staffing arrangement is a contract labour arrangement, now governed by the Occupational Safety, Health and Working Conditions Code, 2020 (Chapter XI), which subsumed the earlier Contract Labour Act. A contractor who supplies labour must hold a licence, and under Chapter XI the contractor is responsible for paying each worker's wages, with the principal employer as a backstop who must pay if the contractor defaults and can recover the amount from the contractor. That liability is why the client cares that the wage base is real and not hollowed out. The wage floor and its components come from the Code on Wages, 2019: the state minimum wage under Section 5, which cannot fall below the Central floor wage under Section 9, built on the Code's definition of wages. The employer statutory costs (provident fund, ESI, gratuity and bonus) flow from the Code on Social Security, 2020 and the Code on Wages, and paid leave from the OSH Code (annual leave with wages). GST on manpower supply is 18% under SAC 9985, charged on the full billed value, with security services potentially under reverse charge, and the client deducts TDS under Section 194C of the Income-tax Act. The labour codes came into force on 21 November 2025 with Central Rules notified on 8 May 2026; licence thresholds, exact contribution rates and each state's minimum wage must be checked against the current notification before the card is issued.
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Get the templateCommon questions
Should GST be charged on the whole bill or only on our service charge?
On the whole bill. GST on manpower supply is 18% under SAC 9985 and applies to the full taxable value of the supply, meaning wages, statutory costs and your service charge together, not the margin alone. The client claims input tax credit subject to the usual conditions.
Can we quote a bill rate below the state minimum wage if the client pushes back on price?
No. Basic plus DA must be at least the state notified minimum wage for that skill category, and that minimum cannot be set below the Central floor wage for the area. If the contractor underpays, the principal employer becomes liable for the shortfall under the OSH Code, so a below-minimum quote is a risk for both sides, not a saving.
What happens to the rate when the government revises minimum wage or PF or ESI rates mid-contract?
The rate card should carry a statutory revision clause so the bill rate revises automatically from the effective date of any notified change in minimum wage or contribution rates. Without it, the increase comes straight out of your margin, because you still pay wages and contributions in full while billing the old rate.