The Contract Labour (Regulation and Abolition) Act, 1970 establishes a principle that surprises many facility heads: if your contractor fails to pay statutory dues to their workers, the obligation can fall on you. The mechanism is straightforward. The establishment engaging contract labour is the principal employer. If the contractor does not pay wages, the principal employer is required to pay them and may recover from the contractor. If the contractor does not deposit PF or ESIC contributions, authorities may proceed against the principal employer for recovery. This is not theoretical. Enforcement activity across NCR has increased, and the pattern is consistent: a labour inspection at a corporate site, a review of contractor records, a finding of under-deposit, and a demand notice addressed to the establishment. Protection is procedural rather than contractual. An indemnity clause in the service agreement is useful but does not prevent the demand from arriving. What prevents it is verification. Practical controls include obtaining monthly PF and ESIC challans with the full employee list, reconciling that list against the deployed headcount, verifying the contractor's registration under the Act, maintaining Form XII and Form XIII registers, and conducting an annual compliance audit of contractor records. Facility heads who treat compliance verification as a monthly routine rather than an annual formality rarely encounter unpleasant surprises.