Sections 48 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 48 of the Occupational Safety, Health and Working Conditions Code, 2020 (the OSH Code) sets the procedure for issuing or renewing a contractor licence: an electronic application, a five-year validity, and an amendment route for increasing the headcount. Section 49 bars the contractor from charging any fee, commission or cost to the contract labour.
A contractor's licence application is made electronically in the prescribed form and gives the number of contract labour, the nature of work and, where relevant, details of inter-State migrant workers (48(1)). The licence under section 47(1) is valid for five years for the number of contract labour stated; to increase the number the contractor applies for an amendment and deposits the extra security for the balance period (48(3)). The contractor shall not charge directly or indirectly, in whole or in part, any fee or commission from contract labour (section 49).
Section 48 sub-section by sub-section
| Sub-section | Content |
|---|---|
| 48(1) | Application electronically, in the prescribed form and manner, with the number of contract labour, nature of work and other particulars including employment of inter-State migrant workers |
| 48(2) | The section 119(1) authority follows the procedure prescribed |
| 48(3) | A licence under 47(1) is valid for five years for the number of contract labour specified; to increase it, the contractor applies in the prescribed manner for amendment, and the number rises to the extent of the security deposit specified in the amended licence for the balance period |
| 48(4) | The licence contains the responsibility of the contractor as prescribed |
| 49 | The contractor shall not charge, directly or indirectly, in whole or in part, any fee or commission from the contract labour |
All of these are "subject to section 119", the common licence section explained in our article on section 119. Contractors who need help with the application, the security deposit and the amendment process can use our labour law compliance service.
Section 48 in practice
Applying
The application is electronic. It must state how many contract labour will be engaged, the nature of the work, and information on inter-State migrant workers employed. Where the Central Rules apply, the portal is the Shram Suvidha Portal and the form is FORM-XXI (Rule 87).
Validity and headcount
The licence runs for five years and is tied to the headcount stated. The Code's answer to growth is an amendment: apply in the prescribed manner, deposit the security for the extra workers, and the licence headcount rises for the balance period. Do not simply deploy more workers than the licence allows; see section 47.
The contractor's responsibilities
Under 48(4) the licence itself states the contractor's responsibilities as prescribed. Rule 93 of the Central Rules covers wages at not less than the Code on Wages rates, parity of holidays and hours with directly employed workers doing similar work, EPF and ESI membership where applicable, and intimation of changes on the portal; see Rules 93 and 94.
Section 49: no fees from contract labour
Section 49 is one sentence and absolute in tone. The contractor shall not charge:
- directly or indirectly;
- in whole or in part;
- any fee or commission;
- from the contract labour.
The heading of the section also says "or any cost to workers". The bar therefore covers recruitment fees, placement charges, commissions and similar payments. It covers charges collected through agents or sub-contractors ("indirectly").
What the Central Rules, 2026 add
Where the Central Government is the appropriate Government, the Occupational Safety, Health and Working Conditions (Central) Rules, 2026 (G.S.R. 345(E), 8 May 2026) apply. Where a State is, use the State's rules.
Rule 90: security and fees.
- Bank guarantee at Rs 1,000 for each contract labour to be employed, deposited before the licence is issued.
- For very large contractors, Rs 10 crore (one lakh to under 1.5 lakh workers), Rs 15 crore (1.5 lakh to under two lakh) and Rs 20 crore (two lakh or more).
- If a licence has expired, the authority may adjust the earlier security against a new application.
- Fee table: no licence up to 49 contract labour; Rs 1,000 for 50 to 100; Rs 2,000 for 101 to 300; Rs 3,000 for 301 to 500; Rs 5,000 for 501 to 1,000; Rs 10,000 for 1,001 to 5,000; Rs 20,000 for 5,001 to 10,000; Rs 30,000 for 10,001 to 20,000; Rs 40,000 above 20,000.
Rule 91: renewal.
- Apply electronically on the Shram Suvidha Portal at least thirty days before expiry but not earlier than ninety days before expiry.
- Fee is the same as for grant; if the application is late, an additional 25 per cent is payable.
- The authority must renew within seven days electronically, failing which the licence is deemed issued and auto-generated.
Rule 92: refund of security.
- On expiry, if the contractor does not want renewal, apply electronically for refund with the expired licence, notice of completion of work and bank details.
- If there is no breach or forfeiture order, the authority directs the return; if there is a forfeiture order, the balance is refunded within thirty days. Applications are disposed of within thirty days.
Rule 94: intimation of work order within fifteen days, through the portal.
See Rules 87 and 88, Rules 89 and 90 and Rules 91 and 92.
Practical points
- Calendar the renewal window. It opens 90 days before expiry and closes 30 days before.
- Budget the security. Rs 1,000 per contract labour as a bank guarantee under Rule 90 before grant.
- Amend before you grow. Apply for an amendment and deposit for extra headcount before deploying.
- Audit recruitment channels. Check that no agent, supervisor or sub-contractor collects any money from workers; section 49 covers indirect charges too.
- Keep the refund file. Notice of completion of work and bank details are needed for the refund.
- Check the State rules. For establishments where a State is the appropriate Government, the State's fee and deposit rules apply.
Example. A contractor holds a five-year licence for 200 contract labour and wins extra work needing 80 more. It applies for an amendment, deposits the security for the extra workers for the balance period, and only then deploys them. It also reminds its supervisors that no fee or commission may be taken from any worker.
For the old-law comparison, see our guides on how to renew a contractor licence and how to apply for a contractor licence.
Need help with contractor licence applications?
Headcount, deposit, renewal window and the no-fee rule are where contractors most often slip. Our labour law compliance team can prepare the application, plan the renewal calendar and check your recruitment and payment practices against section 49.
Key takeaways
- Licence applications are electronic, with headcount, nature of work and inter-State migrant worker details (48(1)).
- Licence validity is five years for the stated headcount; increase by amendment and deposit (48(3)).
- No fee, commission or cost from contract labour, directly or indirectly (section 49).
- Central Rules: bank guarantee Rs 1,000 per worker; renewal window 90 to 30 days; 25 per cent extra if late; refund within thirty days.
Read next
- Sections 46 and 47: designated authority and licensing of contractors
- Section 50: information regarding work order
- Rules 91 and 92: renewal of licence and refund of security deposit
- How to renew a contractor licence
Disclaimer: Based on the Occupational Safety, Health and Working Conditions Code, 2020 (as enacted) and, where noted, the Occupational Safety, Health and Working Conditions (Central) Rules, 2026 (G.S.R. 345(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.