Hire employees
and contractors in India

Remote’s guide to employing in India.

Capital city
New Delhi
Currency
Indian Rupee (₹, INR)
Population size
1,352,642,280 (2018 est.)
Primary languages of business
English, Hindi
01

Facts & stats

India, officially the Republic of India (Hindi: Bhārat Gaṇarājya), is a country in South Asia. It is the second-most populous country, the seventh-largest country by area, and the most populous democracy in the world. India has been a secular federal republic since 1950, governed in a democratic parliamentary system. It is a pluralistic, multilingual and multi-ethnic society and has become a fast-growing major economy, a hub for information technology services, with an expanding middle class.

India Map
  • Capital city
    New Delhi
  • Currency
    Indian Rupee (₹, INR)
  • Primary languages of business
    English, Hindi
  • Population size
    1,352,642,280 (2018 est.)
  • Ease of doing business
    Easy
  • Cost of living index
    $
  • Payroll frequency
    Monthly
  • VAT - standard rate
    12.5%-15%
  • GDP - real growth rate
    6.982% (2018 est.)
02

Grow your team in India with Remote

Employing in India requires employers to own a legal entity in the country and manage payroll, tax, benefits and compliance through their own in-country resources. The complexity of employment regulations in India makes full compliance with employment laws a burdensome process.

Through Remote’s Global Employer of Record solution, your team is employed by our local legal entities in each country, and we take care of payroll, tax, benefits and compliance so you can focus on what matters most -- your people.

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India risks illustration

Risks of misclassification

India, like many other countries, treats self-employed individuals or contractors and full-time workers differently and there are risks associated with misclassification.

03

Employing in India

Under the Constitution of India, labour falls within the concurrent list giving power to both the Central and the respective State Government to legislate on such items, with the residual law-making powers vesting with the Centre.

This has resulted in a plethora of central and state laws related to wages, employment, industrial relations, social security, etc. being enacted to protect the interests of employees and to increase employment opportunities. The following are only guidelines in the broadest sense, and professional legal services are recommended when employing in India.

Public holidays

Date Holiday Name Extra information
New Year's Day
Republic Day
Holi
Ram Navmi
Independence Day
Janmashtmi
Ganesh Chaturthi
Gandhi Jayanti
Dussehra
Diwali
Govardhan Puja
Christmas Day
Minimum
Wage

Minimum Wage: stipulated by law, but varies state-by-state. Ranges from 160 rupees per day in Bihar, 348/day in Mumbai and 750 rupees per day in Kerala. State government set a separate minimum wage for agricultural workers. The minimum wages are set according to the 1948 Minimum Wages Act.

Payroll
Cycle
For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.
Onboarding
Time
We can help you get a new employee started in India fast. The minimum onboarding time we need is only 9 working days.

Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.

For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.

Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.

04

Competitive benefits package in India

Besides providing your employees with all statutory benefits in India, Remote can advise on and arrange for custom benefits and perks for your employees upon request.

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05

Tax and Social Security in India

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in India.

  • Employer

    • 12% - Provident Fund
    • 3.25% - Health Insurance
  • Employee (Old tax regime)

    • Minimum 12% - Provident Fund
    • 0.75% - Health Insurance
    • 0% - Up to Rs 2,50,000
    • 10% - Rs 2,50,001 - Rs 5,00,000
    • 20% - Rs 5,00,001 - Rs 10,00,000
    • 30% - Above Rs 10,00,000
  • Employee (New tax regime)

    • Minimum 12% - Provident Fund
    • 0.75% - Health Insurance
    • 0% - Up to Rs 2,50,000
    • 5% - Rs 2,50,001 - Rs 5,00,000
    • 10% - Rs 5,00,001 - Rs 7,50,000
    • 15% - Rs 7,50,001 - Rs 10,00,000
    • 20% - Rs 10,00,001 - Rs 12,50,000
    • 25% - Rs 12,50,001 - Rs 15,00,000
    • 30% - Above Rs 15,00,000
06

Types of leave

Statutory
leave

By law, full-time workers in India are entitled to 15 days of holiday leave per year.

Pregnancy and
maternity leave

Expecting mothers are entitled to six months of paid pregnancy leave (before the due date) and at least 26 weeks maternity leave (after childbirth) for the first two children. For mothers with more than three children, each new child results in an entitlement of 12 weeks of paid maternity leave.

Parental/paternal
leave

The private sector does not have mandatory parental leave and any parental leave policies are decided on a per-company basis. Male Indian government employees get up to 15 days.

Other
leave
  • Casual leave: provided for urgent and unexpected matters. Companies commonly have a limitation of three days of casual leave per month and a total of six per year. Lapses automatically by end of year if unused.
  • Work related injury leave: intended for unforeseen personal circumstances for which an employee has to take time off immediately. Examples include making arrangements for the care of a sick family member or in the event of a death in the family.
07

Employment
termination

Termination process

Termination of the employment relationship can happen in the following ways:

  • Voluntary termination by the employee (resignation);
  • Retirement as per the employment contract;
  • Non-renewal of the employment contract or expiry;
  • Dismissal of the employee due to serious employee misconduct (f.ex. theft, fraud, etc.); or
  • Collective dismissal due to economic reasons (f.ex. bankruptcy, restructuring, etc.).

Notice period

For an employee that has worked for at least 3 months, a notice period of 30 days is required. No notice is required for termination for misconduct.

Probation periods

There is no legal stipulation for minimum and maximum probation periods. However, as a matter of trade practice, the probation period usually ranges from 2 to 6 months.

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