Contract Labour Licensing: Thresholds and Duties

Eight welfare duties: who is responsible, and where contract labour figures

The Code sets trigger points by the number of workers ordinarily employed and, for the canteen, expressly counts contract labourers. Most facilities fall on the establishment's employer; the accommodation duty in construction is the one place the Code splits the job between the contractor and the principal employer.

Thresholds shown are the worker counts stated in Section 24. Rows marked 'no number stated' carry no numeric threshold in the text. Worker totals used in the worked example below are illustrative, not statutory. Facility standards themselves are 'as may be prescribed' by the Central Government's rules.

The rule in plain words

When you engage contract labour, those workers do not drop out of the Code's head-counts. Section 24 makes the establishment's employer responsible for a set of welfare facilities, and for the canteen the Code expressly folds contract labourers into the count. So the direct and contract workforce together decides whether a duty is triggered.

The Code draws one clear line between the principal employer and the contractor. For building and other construction work carried out through a contractor, the contractor provides the temporary living accommodation for the workers, and the principal employer bears the expense of that accommodation. That is the split the section spells out in words.

The trigger numbers sit in the section; the standard each facility must meet is left to rules made by the Central Government, phrased as facilities 'as may be prescribed'. In short, the section fixes when a duty attaches, and the rules fill in what good enough looks like.

• Canteen: 100 or more workers, counting contract labourers
• Rest-rooms, shelters, lunch-room and a creche: more than 50 workers
• Welfare officer: 250 or more workers
• Ambulance room: more than 500 workers
• Washing, bathing, locker and first-aid facilities: a general duty with no head-count in the text

Worked example: mixing direct and contract workers

Assume, purely to show the arithmetic, that a distribution warehouse ordinarily employs 60 direct workers and engages 70 workers through a contractor, a total of 130. These worker counts are illustrative; only the trigger numbers below come from the Code.

Cross a threshold and the duty attaches to the establishment's employer, whether the additional heads are direct or contract, subject to the standard the rules prescribe.

• Canteen: the trigger is 100 or more, and contract labourers count. 130 is above 100, so a canteen is required.
• Rest-rooms, shelters and lunch-room: the trigger is more than 50. 130 is above 50, so these are required.
• Creche: the trigger is more than 50. 130 is above 50, so a creche for children under six is required, and the site may join a common creche.
• Welfare officer: the trigger is 250 or more. 130 is below 250, so this is not required on these illustrative numbers.
• Ambulance room: the trigger is more than 500. 130 is below 500, so this is not required here.

Exceptions and fine print

The Code does not apply to the offices of the Central Government or a State Government, or to a warship of any nationality. There is an important carve-back: where contract labour is engaged through a contractor in such a government office, the Code does apply, and the government is treated as the principal employer.

The definition of appropriate Government reaches beyond the main establishment. It expressly covers the establishment of contractors working for a covered establishment, corporation, public sector undertaking or autonomous body, which is what decides who administers the duties for that contractor's workforce.

The provisions supplied here set welfare duties and the worker counts that trigger them. They do not, on their own, state a number of contract workers at which a licence or registration becomes due, nor a licence form, fee or period of validity. Treat any specific licensing figure as coming from the appropriate Government's rules or a notification, not from these sections.

What an employer must do

• Count all workers ordinarily employed, both direct and those working through your contractor, before deciding which facilities apply; the canteen test expressly includes contract labourers.
• Provide and maintain the facilities whose thresholds you cross: canteen at 100 or more, rest-rooms, lunch-room and a creche above 50, a welfare officer at 250 or more, an ambulance room above 500, plus washing, bathing, locker and first-aid facilities that carry no head-count.
• Keep washing and bathing, locker and rest facilities separate for male and female employees, and provide separate bathing, locker and rest facilities for transgender employees.
• In building or other construction work done through a contractor, budget for the accommodation the contractor provides, because the Code places that expense on you as principal employer.
• Meet the standard each facility must reach as prescribed by the Central Government's rules, and check with the appropriate Government for any registration or licence it requires before you engage contract labour, since the specific threshold and process are set there and not in this section.

What a worker can do

• Expect the welfare facilities to cover you as a contract labourer once the establishment crosses a threshold; the Code counts you in, it does not leave you out.
• Rely on washing, bathing, locker and first-aid facilities whatever the head-count, and on facilities kept separate for your gender, including separate facilities for transgender employees.
• On a construction site, the temporary living accommodation is the contractor's to provide, with the principal employer bearing the cost, so a gap can be raised with either party.
• If you work through a contractor in a Central or State Government office, the Code still protects you, with the government standing as principal employer.

Where the licence detail actually comes from

Because the excerpt in front of us is the welfare and definitions part of the Code rather than its contract-labour licensing chapter, the licensing specifics have to be read from the rules. The trigger for a licence, the form, the fee and the validity period are all fixed by the appropriate Government, in line with the Code's pattern of leaving detail to what is 'prescribed'.

Practically, that means an employer should treat the welfare thresholds on this page as settled by the Code itself, but confirm any licence or registration numbers against the current rules or notification for the appropriate Government before engaging contract labour, rather than assuming a figure.

Frequently asked questions