PSARA Compliance Checklist for Factories and Industrial Units

Factories in Maharashtra outsource security to a licensed agency for good reasons, but outsourcing the work does not outsource the liability. Under the Contract Labour (Regulation & Abolition) Act, the factory is the principal employer, and labour inspectors, EPFO and ESIC officers, and your own customers' auditors will ask you — not only the agency — for evidence that the guards at your gate are lawfully employed. This checklist is the one our industrial clients in Phaltan MIDC, Solapur and Kupwad use.

A. Before the agency starts (onboarding file)

Collect and file copies of:

• PSARA licence of the agency, valid for your district, with expiry date noted in your compliance calendar.
• PF and ESIC registration certificates and GST registration.
• Contract labour licence of the agency under the CLRA Act (required when 20 or more contract workers are engaged, thresholds vary — check with your labour consultant), and your own Registration Certificate as principal employer (Form I).
• Service agreement with post-wise deployment, shift pattern, wage basis, reliever policy, replacement timelines, indemnity and insurance clauses.
• Post instructions for every post — gate, material yard, weighbridge, night patrol — signed by both parties.
• Guard dossiers: photograph, ID proof, address proof, police verification receipt, training certificate, PF (UAN) and ESIC (IP) numbers for each guard deployed.

B. Every month (with the invoice)

Do not release payment until the following are attached:

1. Attendance register / muster roll for your site, reconciled against your own gate records.
2. Wage register or payslips showing minimum wage, DA, overtime and deductions for each guard.
3. PF ECR and payment challan and ESIC contribution challan for the previous month, with your site's guards identifiable.
4. Reliever and replacement log — which posts were covered by relievers and when.
5. Incident and night-round reports — including surprise-check timestamps.
6. GST-compliant invoice with the correct HSN/SAC code (998521 for security services) and reverse-charge note where applicable.

A simple monthly checklist signed by your administration head and filed with the invoice is usually enough to satisfy an inspector that you exercised due diligence.

C. Quarterly and annual

• Verify the agency's bonus payment to guards (annual, by November) and leave encashment records.
• Review training refreshers — fire-fighting drills, first aid, emergency evacuation — and keep drill reports in the factory's safety file (Factories Act and your ISO 45001 auditor will ask).
• Check that uniforms, ID cards and equipment (torches, batons where permitted, communication sets) are in serviceable condition.
• Renew the compliance calendar for licence expiry dates — PSARA (five years), CLRA licence (annual), and your Form I registration.
• Maintain the half-yearly return obligations under the CLRA Act as advised by your labour consultant.

D. Site-specific controls that inspectors and insurers look for

• Gate and material-movement registers — inward/outward, returnable gate passes, vehicle logs.
• Visitor management — ID verification, badge issue, escort policy for restricted areas.
• Key control and after-hours access procedures.
• Fire safety — trained fire wardens on each shift, hydrant and extinguisher checks logged, evacuation drill at least twice a year. See our note on fire safety officers versus security guards.
• Emergency contact matrix — agency control room, QRT, local police station, fire brigade, hospital.

E. Common findings in factory audits

• Guards' PF deducted but not deposited (visible only if you check the ECR against the muster).
• Overtime worked on 12-hour shifts but not paid at double rate.
• Police verification "in process" for months.
• Post instructions never written down, so duties drift.
• No reliever — the same guard on duty 30 days running, which is both a compliance failure and a security risk.

Making it easy

The practical fix is to choose an agency that treats these documents as part of the service rather than a favour. At OSS, the monthly compliance pack (muster, wage sheet, PF/ESIC challans, reliever log, incident and round reports) is standard for every industrial contract, because our government and bank clients are audited on exactly these items. If you run a unit in Phaltan MIDC, Solapur or Kupwad, Sangli, ask us for a sample pack before you compare quotations.

This checklist is general guidance for industrial administrators, not legal advice. Thresholds and forms vary by establishment size and district; confirm with your labour-law consultant.