1. Legal Framework
Labour suppliers are regulated by the Labour Act, 2074 (2017), the Labour Regulations, 2075 (2018) and the Directive on Management of Labour Supplier Company Licensing and Renewal Procedures, 2081.
2. Permitted Services
Labour supply is permitted within the prescribed categories:
- Security services: Security personnel.
- Facilitation services: Cleaning, waste management, gardening, office assistance and catering.
- Business support services: Drivers, loading and unloading personnel, maintenance workers, technical support and construction workers.
- Domestic support services: Domestic workers and caregivers.
A supplier may obtain a licence for a maximum of two prescribed service categories. The permitted services and geographical coverage must be reflected in the licence.
4. Required Documents
The primary documents include:
- Company registration certificate;
- Memorandum and Articles of Association;
- Updated shareholder register;
- PAN or VAT registration certificate;
- Applicable tax clearance or evidence of payment of government dues;
- Social Security Fund employer registration certificate;
- Directors’ citizenship certificates and contact details;
- Details of the proposed services and geographical coverage;
- Directors’ declarations concerning disqualifying criminal convictions and blacklisting; and
- Authorisation documents where a representative submits the application.
Certified copies and additional documents may be required by the licensing authority.
5. Registration Procedure
Incorporate the company: Register the company with appropriate labour supply objectives and complete the applicable tax and SSF registrations.
Select services and coverage: Identify the permitted service categories and the Labour Office jurisdictions in which the company intends to operate.
Submit the application: File the prescribed application and supporting documents with the relevant Office or Department.
Complete verification and financial requirements: Respond to requests for information, pay the licence fee and provide the required deposit or bank guarantee.
Step 5: Obtain the licence: Commence labour supply only after approval and operate within the authorised services and geographical coverage.
6. Fees and Security
| Particulars | Labour and Employment Office | Department |
| Initial licence fee | NPR 10,000 | NPR 20,000 |
| Annual renewal fee | NPR 5,000 | NPR 10,000 |
| Security for the first office jurisdiction | NPR 15 lakh | NPR 15 lakh |
An additional NPR 5 lakh security is required for each additional office jurisdiction. Where a bank guarantee is submitted, current departmental guidance requires it to remain valid for at least nine months beyond the licence validity period and to be issued by a recognised Class “A” bank.
7. Renewal and Continuing Compliance
The licence must generally be renewed annually by the end of Ashwin. Renewal requires the prescribed fee, applicable tax documents, reporting records and renewed bank guarantee where relevant.
Suppliers must maintain employment agreements, pay lawful remuneration and benefits, fulfil social security obligations and submit the required worker details and labour audit reports. Agreements with client businesses cannot remove workers’ statutory entitlements.
Frequently Asked Questions
Is company registration sufficient to supply workers?
No. A separate labour supplier licence is required.
Can a sole proprietorship obtain the licence?
The statutory licensing framework requires an incorporated company.
Does one licence automatically permit nationwide operations?
No. The licence must authorise the relevant geographical coverage, supported by the required security.
Can the company supply workers for every type of work?
No. It must remain within the prescribed services and the categories authorised in its licence.
Is SSF registration required for the application?
Yes. Current licensing guidance requires the company’s SSF employer registration certificate.
How Alpha Law Associates Can Assist
Alpha Law Associates assists with company incorporation, labour supplier licensing and renewal, employment and client agreements, and ongoing labour compliance.