Skip to main content

Hiring Employees in India: A Comprehensive Guide

Anna avatar
Written by Anna
Updated over 2 weeks ago

Table of Contents

  1. Introduction

  2. Key Considerations for Employing in India

  3. Benefits

  4. Employment Contracts

  5. Onboarding

  6. Leaves

  7. Payroll & Taxes

  8. Termination Process

  9. Invoice Schedule

  10. Get Started with Omnipresent


1. Introduction

Hiring employees in India requires a clear understanding of state-specific laws, registration procedures, and statutory entitlements. Omnipresent’s Employer of Record (EOR) service simplifies onboarding, payroll, and compliance for your remote team.


2. Key Considerations for Employing in India

  • Currency: Indian Rupee (₹, INR)

  • Languages: Hindi, Marathi, Telugu, Tamil, Bengali (22 national languages)

  • Employer Costs: Average (~13% of salary)

  • Termination Complexity: Hard

  • Onboarding Timeline: ~13 calendar days

  • Payroll Frequency: Monthly


3. Benefits

What We Offer

  • Mandatory:

    • Retirement & pension (EPF)

    • Life Insurance

    • Accident Insurance

  • Supplementary:

    • Health Insurance (including Dental, Vision, and dependent cover)

    • Wellbeing initiatives

Healthcare

  • India lacks a robust public healthcare system, making employer-funded supplementary health insurance common.

Retirement

  • Employee Provident Fund (EPF): Mandatory employer/employee contributions via payroll

  • Termination indemnities may apply upon retirement


4. Employment Contracts

Contract Types

  • Indefinite-term contracts only

  • Fixed-term contracts not offered via Omnipresent

Requirements

  • Written contracts are standard practice (mandatory in some states)

  • Language: English

  • Signature: Digital signatures accepted

  • Backdating: Not permitted

Contract Customisation

  • Customisable: Unlimited PTO, extra-legal sick days

  • Non-customisable: Overtime, restrictive covenants, stylistic formatting

Probation Period

  • Typically 3–6 months (no statutory limit, but must be reasonable)

  • Probation is always included unless employment is a transfer


5. Onboarding

Timeline

  • ~13 calendar days, excluding visa or background check delays

  • Includes:

    • Platform setup

    • Right-to-work check

    • Employment contract

    • Benefits & payroll enrollment

Registration & Approvals

  • Vary by state. Contact support for details.

Immigration & Visas

  • Visa support available for highly skilled workers

  • Visas typically granted for 1 year and renewable

Right-to-Work

  • Not legally required for Indian citizens (except in BFSI sectors)

  • Foreign nationals must have proper visa

Employee Transfers

  • Seniority can be recognized if employee previously worked for client or another EOR


6. Leaves

Annual Leave

  • 15–20 days/year, depending on state

  • Accruable to a capped limit

  • Omnipresent can offer unlimited PTO, but statutory minimums must be enforced

Maternity Leave

  • 26 weeks for up to two children

  • 12 weeks for more than two children

  • 6 additional weeks for complications, miscarriage, or medical termination

  • Paid at 100% of salary by employer

Paternity Leave

  • Not required by law, but 15 days is common practice

Sick Leave

  • 10–15 days/year, varies by state

  • Employer-paid

Special & Casual Leave

  • Used for personal emergencies (e.g., illness in the family)

Public Holidays


7. Payroll & Taxes

Payroll Cycle

  • Monthly

    • Cut-off: 6th of the month

    • Payment: Last working day

Extra Payments

  • Statutory Bonus:

    • Mandatory for employees earning <INR 21,000/month

    • Bonus = 8.33%–20% of wages

  • Diwali or discretionary bonuses are customary

Hourly Wage

  • Not accepted via Omnipresent

Minimum Wage

  • Set by state; no federal minimum wage currently

Standard Work Schedule

  • 8–9 hours/day, 40–45 hours/week

  • Flexible schedules permitted

Employer Costs


8. Termination Process

Involuntary Termination

  • Allowed without cause only for non-workman roles or probationary employees

  • “Workman” status depends on job duties and salary (<INR 10,000/month typical threshold)

  • Omnipresent must be consulted before any termination

Severance Pay

  • Gratuity due after 5 years of continuous service

    • Exception: paid upon death or disability regardless of tenure

  • Must pay on top of salary; not deductible

  • Other termination pay includes:

    • Accrued leave

    • Bonus (if eligible)

    • Payment in lieu of notice

    • Contractual dues

    • No severance required for misconduct terminations

Notice Period

  • 1 month standard, varies by state and job role

  • No notice required for probation <6 months


9. Invoice Schedule

Initial Fees

  • Setup Fees: Triggered upon signing

  • Deposit: Triggered when contract is ready

  • Initial Salary Prepayment: Invoiced on employee start date

Ongoing Monthly Costs

  • Invoiced monthly in arrears after payroll finalization

  • Includes:

    • Service fee

    • Insurance (if applicable)

    • FX fees (if applicable)


10. Get Started with Omnipresent

We make it easy to hire in India through expert-led onboarding, HR support, legal compliance, and localized payroll. Let us manage the complexities so you can scale confidently.

[Talk with an Expert]

Did this answer your question?