Labour licence and labour law registration in Rajasthan

Rajasthan raised the thresholds first, in 2014

In July 2014 the Rajasthan Assembly passed amendments to four central labour statutes, which then received Presidential assent. This is the single most important piece of context for anyone assessing labour law applicability in this state, and it is routinely missed.

The Apprentices Act was also amended to allow third-party training providers and additional trades.

Eleven years later the Occupational Safety, Health and Working Conditions Code and the Industrial Relations Code adopted the same numbers nationally. So Rajasthan's thresholds and the national thresholds have converged — but a great deal of published Rajasthan content still quotes 10 workers with power for factory licensing, which has been wrong in this state since 2014 and is now wrong everywhere.

Contract labour: two registrations, not one

If you engage workers through a contractor, there are two distinct obligations and they sit on different parties.

The principal employer — the establishment where the work is done — obtains a Certificate of Registration in Form I. The contractor obtains a Licence in Form IV, and can only be granted one if the principal employer has issued Form V. Neither can proceed without the other, which is why contract labour compliance so often stalls at the site.

The applicability threshold in Rajasthan is 50 or more contract workers on any day of the preceding twelve months, consistent with both the 2014 state amendment and the OSH Code. Below that, the Act does not bite, though your obligations on wages, PF and ESI for those workers are unaffected.

The Rajasthan Contract Labour (Regulation and Abolition) Rules, 1971 as published on India Code carry the following fee schedule:

A security deposit of ₹30 per workman to be employed is prescribed, reduced to ₹5 per workman for co-operative societies.

We are reproducing these because they are what the published Rules say, but they are plainly the 1971 figures and a ₹5 licence fee is not a realistic 2026 amount. We could not verify a revised fee notification from an official source at the time of writing — confirm the amount payable on the LDMS payment screen or with the Labour Commissioner's office before budgeting. Anyone quoting you a precise current figure without a notification reference is guessing.

Applications are made through LDMS on the Rajasthan SSO portal. The registers that follow — Form XII register of contractors, Form XIII register of workmen, Form XVI muster roll, Form XVII wage register, Form XIX wage slips — are what an inspector actually asks to see, and they are also what a principal employer should be collecting from its contractors monthly as a matter of course. Under the statute the principal employer is liable for wages the contractor fails to pay.

Construction: BOCW registration and the 1% cess

Construction has its own regime and it is the one that generates the largest unexpected bills in Rajasthan.

Any establishment employing ten or more building workers on any day in the preceding twelve months must register with the registering officer. Registration is to be applied for within sixty days of commencement of the work. Contractors engaging building workers also require a licence.

Registration fees under the Rules are modest and slab-based on worker numbers — ₹100 for up to 100 workers, ₹500 for 101 to 500, and ₹1,000 above 500. We could not confirm a Rajasthan-specific variation of these slabs from an official state source, so verify on the portal.

The cess is the real number. Under the Building and Other Construction Workers' Welfare Cess Act, 1996, cess is levied at not less than 1% and not more than 2% of the cost of construction; Rajasthan applies 1%. The important Rajasthan-specific points are these:

• Residential buildings costing under ₹10 lakh are exempt. Commercial and government buildings enjoy no such exemption regardless of cost.
• It applies to construction undertaken after 27 July 2009.
• The owner must give notice to the Labour Department within thirty days of commencing construction, in the prescribed form.
• Cess is payable within thirty days of completion of construction or of assessment, whichever is earlier. Where the project runs beyond a year, it becomes payable within thirty days of the end of each year.
• Unpaid cess attracts interest at 24% per annum, and a penalty of up to 100% of the cess amount where payment is not made by the due date. Recovery can be routed through the District Collector.

That combination — 24% interest plus a penalty equal to the cess itself — is why Rajasthan developers have publicly petitioned for relief on labour cess penalties. If you are building anything commercial, provide for the 1% from the first estimate rather than discovering it at completion.

Note also that the OSH Code subsumes the BOCW Act, 1996, but the separate Cess Act of 1996 is not among the subsumed statutes. The cess obligation continues in its own right.

Factories

A factory licence in Rajasthan is required where 20 or more workers are employed with the aid of power, or 40 or more without power. Both figures are post-2014 Rajasthan positions and are now also the OSH Code positions. Content quoting 10 and 20 for Rajasthan is out of date.

The sequence is plan approval first, then licence. Factory building plans and machinery layout are submitted to the Factories and Boilers Inspection Department for approval, after which the licence application is filed with the supporting documents — Rajasthan State Pollution Control Board consent, local body no-objection, site plan, machinery layout with connected horsepower, list of workers, manufacturing process flowchart, and for hazardous processes a risk analysis and on-site emergency plan. The department indicates processing of roughly 15 days for non-hazardous units and 30 days for hazardous ones.

Licences are typically issued for one to five years and must be renewed before expiry. The fee under the Rajasthan Factories Rules, 1951 varies with the number of workers and connected horsepower. We could not verify the current fee table from the department's live schedule at the time of writing — confirm with the Factories and Boilers Inspection Department (rajfab.rajasthan.gov.in) before you plan the cash outflow.

Which registration applies to you

Where the Labour Codes stand in Rajasthan

The four Labour Codes — the Code on Wages, the Industrial Relations Code, the Code on Social Security and the Occupational Safety, Health and Working Conditions Code — came into force on 21 November 2025, consolidating 29 central labour statutes. The Factories Act, the Contract Labour Act, the BOCW Act, the Inter-State Migrant Workmen Act and the Mines Act are all subsumed into the OSH Code.

But a Code cannot be enforced without rules, and rules under the Codes are made partly by the Centre and partly by each state. That is where the practical position sits today.

In Rajasthan, the final Rajasthan Occupational Safety, Health and Working Conditions Rules, 2026 were notified on 3 July 2026. The draft Code on Wages (Rajasthan) Rules, 2026 were published in the Rajasthan Gazette Extraordinary on 13 January 2026 for a 45-day consultation, with provisions including a minimum wage methodology anchored on 2,700 calories per consumption unit, four skill categories, dearness allowance revision twice a year on 1 April and 1 October, a 48-hour week with a 10.5-hour spread-over, and deductions capped at 50% of wages. Final rules under the Industrial Relations Code and the Code on Social Security had not been notified for Rajasthan when we checked.

What this means operationally, as at 27 July 2026: registrations and licences already held under the legacy Acts remain valid, existing registers continue to be the ones inspectors ask for, and the OSH Code framework is now live in Rajasthan with state rules in place. Do not surrender or allow existing licences to lapse in anticipation of a single-registration regime — the transition provisions preserve them, and the migration to combined registration and returns will be notified, not assumed.

The one thing worth doing now is the wage-structure review. The Code on Wages definition of "wages" requires that excluded allowances not exceed 50% of total remuneration, which for many Rajasthan employers means basic pay must rise and PF, gratuity and bonus costs rise with it. That is a costing exercise, not a filing, and it is better done before the final Rajasthan wage rules land than after.

Sources and last verified

Verified on 27 July 2026.

• Rajasthan Contract Labour (Regulation and Abolition) Rules, 1971 (India Code): https://www.indiacode.nic.in/ViewFileUploaded?path=AC_RJ_83_1123_00006_00006_1560763200349%2Frulesindividualfile%2F&file=tthe_rajasthan_contract_labour_%28recognition.pdf
• Rajasthan 2014 labour law amendments: https://www.business-standard.com/article/economy-policy/rajasthan-assembly-passes-four-labour-reform-bills-114073101662_1.html and https://prsindia.org/billtrack/overview-of-labour-law-reforms
• Ministry of Labour and Employment FAQs on the OSH Code, 2020: https://www.labour.gov.in/static/uploads/2026/01/fb8c6466d0d6a7ed581bcb2bee34694c.pdf
• Labour Codes brought into force on 21 November 2025: https://knowledge.dlapiper.com/dlapiperknowledge/globalemploymentlatestdevelopments/2025/government-of-india-notifies-the-labour-codes-ushers-a-new-era-of-compliances
• Final Rajasthan OSH Rules notified 3 July 2026: https://www.sgcms.com/regulatory-updates/final-labour-codes-rules-rajasthan/
• Draft Code on Wages (Rajasthan) Rules, 2026, gazetted 13 January 2026: https://www.indialaw.in/blog/rajasthan-draft-code-on-wages-rules-2026-key-changes/
• BOCW cess position in Rajasthan: https://udaipurtimes.com/hindi/bocw-cess-mandatory-on-buildings-in-rajasthan/cid17963133.htm
• BOCW registration in Rajasthan: https://genzcfo.com/growthx/bocw-registration-in-rajasthan-for-construction-companies
• Labour Department, Government of Rajasthan: https://labour.rajasthan.gov.in
• Rajasthan Factories and Boilers Inspection Department: https://rajfab.rajasthan.gov.in