The extraction of oil in 1908 and the massive building plans of the oil refinery, shipping docks and company towns in southwest Iran opened a new chapter in Iranian labour history. Having enjoyed absolute monopoly over the extraction, production and marketing of the oil, the Anglo-Persian/Iranian Oil Company (APOC) engaged in a massive labour recruitment campaign. The company began to draw its recruits primarily from tribal and village-based labouring poor throughout a region. The work force was then subjected to the labour discipline of an advanced industrial scale, which eventually contributed to the formation of the early clusters of working class in modern Iran. The recruitment process of unskilled labours, however, soon turned to be not as smooth as it was anticipated. In a region where the human needs were few and cheep, it was not easy task to persuade young men to leave their traditional mode of life in exchange for industrial milieu with radically different work pattern and labour discipline. Therefore, in the formative years of the oil industry in Iran, the function of the intermediary individual, locally known as sarkar was not only to conscript the new labour force for the expanding industry, but also to ensure their loyalties to their new tasks. A dual mission, both a recruiter, and later a foreman. The aim of present study is to review the practices of labour recruitment and labour formation in the formative era, when the fledgling oil industry was first taken shape in Iran. By utilising the narratives of individual workers, the APOC and the Iranian National Archives, the present study intends to examine the positions of sarkars, in recruiting the unskilled labour for the new industry. Considering the adverse working environment, the question is what melange of coercion and inducement were made by the sarkars in order to uphold the labour recruitment and engagement. In other words, this paper investigates the role played by local intermediaries in creating a modern proletariat and wage labour force in a social setting where it did not exist before. Once a permanent wage labour force was consolidated, the function of the local sarkars gradually faded in favour of a formalised “Labour Office”, directed by the oil company. This paper analyses the local impact of this bureaucratisation of labour recruitment, which saw an end of the intermediary role of local agents in transforming their fellow tribesmen into a modern proletariat.