Factory License

Factory License

Factory License Registration: Legalities and Benefits

calendar02 Feb, 2022
timeReading Time: 3 Minutes
Factory License registration

Intending to protect the workers and to assure that the factory owners are giving their workers a healthy and sound work environment, the government has introduced the Factory Act 1948. As per the act, before starting the factory, every factory owner must register their premises with the local authorities. In this article, we will pen down what is Factory License registration, its rules and benefits in detail?

What is Factory License Registration?

As per the Factories Act, 1948[1], Factory License registration is proof of approval given by the government to carry out the manufacturing activities, and it is mandatory to obtain the Factory License. This Act was established to regulate rules and make sure all factories act following the rules and safety guidelines as specified by the Act. A factory license is an approval that permits running a factory in a particular premise and area. In India, any person or organization who wants to use any location to run a factory has to get a Factory license by the authorities before commencing any business.

Requisite Details for obtaining the Factory License Registration-

The following requisite details are required at the time of Factory License-

  1. Name and address of the Factory Owner.
  2. Details of the manager who will run the factory.
  3. Disclosure of number of employees to be hired.
  4. Disclosure of type of manufacturing activity to be carried out in the factory.
  5. Any other information required for close monitoring.

Guidelines to be followed by factory owners under the Factory Act 1948-

At a snail’s pace, the manufacturing industry has seen a continuous boom in its growth throughout the country. Various schemes like ‘Make in India’ have given an outbreak to this industry, which is now the 5th largest manufacturing country worldwide by the end of this year. The Authorities requires that the below-mentioned types of factories shall adhere to the Factory Act 1948.

  • Factories with Ten or more workers involved in manufacturing activity with the power consumption on any day of the preceding 12 months 
  • Hazardous products and Non-Hazardous products
  • Factories with Twenty or more workers involved in manufacturing activity without the power consumption on any day of the last 12 months

The Key criteria before the grant of Factory License-

Before granting the Factory License registration, the authority shall consider the below-mentioned points-

  • To protect the workers’ health and to assure that the working culture is safe.
  • Cleanliness, Hygiene, and the premise shall be free from dust and toxic gases. 
  • Proper facility for drinking water.
  • Well-maintained toilets and urinals for the workers(Female and Male).
  • Proper arrangement for rest house if the workers in the factory are more than 150.
  • If the workers in the factory are more than 250, then canteen should be arranged.
  • Fire-extinguishing arrangements in the premises
  • Weekly off to the workers. 
  • Appropriate working hours.
  • Maintaining the attendance register for every worker working in the factory.
  • Providing the benefit of paid leave to the workers at the rate of one day for 20 days. Also, in the case of overtime, they should be paid double the rate.
  • Restriction of child labor in the factory.
  • Appropriate working hours for Women.
  • Proper training to the Workers in terms of safety.
  • Once a year, a Health check-up of all workers working in hazardous category factories is mandatory.
  • Conducting an awareness Program for the safety of the workers.

Advantages of Getting a Factory License

Getting a factory license registration is beneficial to all the employees working in such factory as it ensures the safety and well-being of these workers. Some of these advantages include-

  1. Avails Legal Benefits provided by the government
  2. Provisions for Employees considering their salaries, health, and safety.
  3. Proper compliances enhances the Productivity of the workers
  4. Provides equality to all employees

Measures to be takenunder the Factory Act,1948

The following safety and welfare measures will be observed while providing a factory license-

Safety Measures to be taken by the Factory Owner

  • Protection of sensitive body parts during work hours
  • Prohibition of workers (especially women and young adults) near hazardous machinery
  • Trained experts to work near machinery that is in motion
  • Machinery barricade.

Welfare Measures under the Factory Act

  • Day-care, canteens, and cafeterias for all the employees.
  • Sitting facilities and rest areas
  • Emergency Assistance
  • Washing and drying facilities


In a nutshell, the Factory License registration obtained under Factories Act 1984 is governed by the Ministry of Labor and Employment. Obtaining a Factory license is mandatory for all the factories eligible for it. It was established to assure that the Factory owners and their workers are well protected. Also, in case of any issues, proper safety measures are taken. The work in the factory can be monotonous and hazardous, and workers are often overburdened and less paid. The Factory license makes sure that not even a single worker is being exploited, and the factory is well inspected by the government.

Read our Article:Factoring Regulations (Amendment) Bill, 2020 Introduced in Lok Sabha

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