Engagement of Contract Labour is an age old practice. With the introduction of new economic policy, this has assumed greater importance. Even today, in the business world, this is the most talked about subject. Employers of various industries – from micro to large – do depend on this workforce in order to sustain and as Principal Employers, they need to take utmost care when they engage a contractor. Besides being compliant, they have to ensure that the contractors engaged by them to stay compliant.