A factory license is a mandatory certification for manufacturing facilities under the Factories Act, 1948, aimed at ensuring safety, health, and welfare of workers. Any facility with ten or more employees operating with power, or twenty or more employees without power, must apply for this license. Here’s a detailed guide on how to get factory license in India.

Understanding the Need for a Factory License

A factory license ensures that the establishment meets legal and safety standards and follows guidelines on worker safety and environmental regulations. It also helps enforce standardized practices for facilities dealing with potentially hazardous substances. Non-compliance can lead to fines, legal action, and potential closure.

Pre-Requisites for Applying for a Factory License

1. Identify the Category of Your Factory: The license requirements can vary depending on the type of factory, size, and the nature of manufacturing. Identifying the factory category can help streamline the application process.
2. Factory Layout Approval: Before applying for a factory license, the factory layout must be approved by the Directorate of Industrial Safety and Health (DISH) or the equivalent state authority. The layout should reflect an organized setup, including space for equipment, ventilation, emergency exits, and safety measures.
3. Document Preparation: Several documents must be gathered in advance to avoid delays. This includes the following:
   • Layout plan and building stability certificate.
   • Machinery layout and details of all equipment.
   • Fire safety, health, and safety policies.
   • Details about workers, including age and identity proof.
   • Details about the power load and electrical installations.
4. Clearances from Other Departments: Depending on the nature of the business, additional clearances may be required from other departments like the Pollution Control Board, Fire Department, and Health Department.

Steps to Obtain a Factory License

1. Create an Online Profile: Most states have moved to an online portal for factory license applications. Start by creating an account on your state’s labor department or factory licensing authority website.

2. Application Form and Document Upload: Fill out the factory license application form available on the portal. Essential information includes:

   • Factory location, details of the occupier, and factory manager.
   • Maximum number of employees and shifts.
   • Proposed power usage.

   Along with the form, upload the necessary documents listed in the previous section. Make sure to double-check for completeness and accuracy.

3. Payment of Fees: Once the application is filled out and documents are uploaded, proceed to pay the application fee. The fee structure varies by state and depends on the size and type of the factory. Payment is typically accepted through net banking, debit/credit card, or other online methods provided by the portal.

4. Verification by Authorities: After submitting the application, the relevant department will review the information. In most cases, they will conduct a physical inspection of the factory premises to ensure compliance with safety and health standards.

5. Inspection Process: An inspector from DISH or the corresponding authority will visit the factory. They assess fire safety measures, machine safety protocols, working conditions, ventilation, emergency exits, and environmental compliance. Any discrepancies or suggestions will be documented, and the applicant will need to address these issues.

6. Approval and Issuance of License: After a successful inspection and verification, the factory license will be issued. The license is typically valid for one year but can vary based on state rules. Renewal requires submission of updated documents and fees, which should be done in advance to avoid penalties.

Key Points to Remember

• Compliance with Labor Laws: The factory must adhere to minimum wage laws, working hours, child labor restrictions, and other labor laws.
• Health and Safety Standards: Establish a clean, safe environment with proper ventilation, emergency response plans, and necessary health and safety protocols.
• Environment Regulations: Ensure compliance with environmental regulations, especially if dealing with hazardous materials. Pollution control measures must be documented.

Benefits of Holding a Factory License