Hire and pay employees in

India, hassle-free

Hire and pay employees in India, hassle-free

With Deel, your business can easily hire employees in India. No more worrying about local laws, complex tax systems, or managing international payroll. Deel takes care of everything in 150+ countries.

The average onboarding time frame in India is 3 days with Deel.

Currency

Indian Rupee (INR)

Capital

New Delhi

Official Language

Hindi and 22 additional languages

Payroll Cycle

Monthly

Onboard, pay and manage employees in India with Deel.

Usually, to hire in India, your business needs an entity. That means a local office, an address registered as a subsidiary, and an account with a local bank. All of this, plus navigating regional benefits, payroll, tax, and HR laws, can take months.

Deel lets you hire employees in India quickly, easily, and compliantly. We even automate tax document collection, payroll, benefits, and more. For your existing direct employees, we can manage your entire payroll operation from end-to-end.

Download the Guide

All the necessary benefits for India
built right in

Deel allows you to provide localized benefits for employees in India within minutes. All in one manageable online dashboard.

  • Employees Pension Scheme
  • Employees Provident Fund
  • Private Healthcare - Unisure (optional)
  • Healthcare - Plum (optional)
  • Private Healthcare - Allianz (optional)

Our quickstart guide to hiring in India

Navigate the tabs below to learn everything you need to know about hiring an employee in India

Minimum Wage Requirements

The minimum wage in India is complex. There is no statutory minimum wage for organizations in the private sector outside of regulated “factory” sectors. 

For factory sectors, India uses a complex method of setting minimum wages set at a state and sub-state level that are updated regularly. India defines nearly 2,000 different types of jobs for unskilled workers and over 400 categories of employment, with a minimum daily wage for each kind of job. 

The monthly minimum wage calculation includes the variable dearness allowance (VDA) component, which accounts for inflationary trends.

Individual Income Tax

The individual income tax ranges from 5% to 30%. Income tax is calculated according to progressive rates. India Income comprises 2 regimes, the New Personal Tax Regime (NPTR) and the old regime. Taxpayers have the option to choose either one of the regimes.

The table below reflects New Personal Tax Regime (NPTR) effective 1 April 2020:

Gross Annual Income (INR) Tax Rate (%)
Up to 250,000 Exempt
Between 250,001 – 500,000 5%
Between 500,001 – 750,000 10%
Between 750,001 – 1,000,000 15%
Between 1,000,001 – 1,250,000 20%
Between 1,250,001 – 1,500,000 25%
Above 1,500,000 30%

Payroll Cost

Estimated employer cost is 5% of the employee’s salary or INR 1950*.

During onboarding, the employee will decide how to contribute to the Provident Fund. Employees can choose to have their contributions calculated based on their basic monthly salary (40% of the gross monthly salary) or based on a fixed amount of INR 15,000. The employer costs for the Employee's Provident Fund (EPF) and the Provident Fund Office EPF Admin Fee will be calculated based on the employee's decision. The Employees' Deposit Linked Insurance (EDLI) cost will be 0.5% of INR 15,000 (INR 75) in both cases.

- Employee's Provident Fund (EPF): 4.8% of the employee’s monthly gross salary (12% of the basic salary) or  INR 1800
- Provident Fund Administrative Charges:  0.2% of the employee’s monthly gross salary (0.50% of the basic salary) or INR 75
-  Employees' Deposit Linked Insurance (EDLI): 0.5% of INR 15,000 (INR 75)

*Employees in India can choose their Provident Fund contribution, which needs to be matched by the employer. Employees can decide to contribute a percentage of their basic salary (40% of the employee's monthly gross salary) or a fixed fee. This will affect the employer costs.

Overtime Pay & Maximum Hours

Standard working hours are 8 hours per day, 40 hours per week. The standard workweek is from Monday to Friday.

There are no statutory requirements for employees in the private sector outside of factory roles. 

Overtime payment is mandatory for factory workers. For additional hours worked, industry practice is to compensate employees with pro-rate PTO or additional pay at 100% of their regular salary.

Maternity Leave

Pregnant employees who have worked with the same employer for 80 days in the last year are entitled to 26 weeks of paid leave. No more than 8 weeks may be taken before the child's birth.

The employee will receive 100% of their average salary during this period, and the employer will be responsible for this pay.
The employee can extend leave without pay.

Paternity Leave

There is no paternity leave currently required by law. 

Parental Leave

In India, no law covers parental leave. However, employees may be entitled to maternity leave.

Sick Leave

Employees are entitled to paid sick leave for up to 12 days. Sick leave accrues at one day of sick leave per month. The employee is paid at 100% of their average salary, and the employer is responsible for this payment. 

Termination Requirements

Terminations must respect complex rules and the rules of an employee’s employment country. The off-boarding is always handled by the Employer with the primary stakeholders. It may include ad-hoc fees as well as required or recommended steps on specific termination cases.

Terminations in India can be done” at-will” (e.i. without cause) depending upon the employment agreement as long as required notice and severance are followed.

Compliant terminations include:

  • Voluntarily by the employee
  • By mutual agreement
  • Unilaterally by the employer based on:
    • Probation period
    • Breach of duties and responsibilities
    • Gross default and misconduct contravening the terms and conditions of the agreement
  • By the expiration of the contract

Notice Period

The minimum notice period is 1 month for ordinary dismissal, but this period varies for each state in India. 

Severance for Employees

Employees are entitled to severance pay based on the reason for termination.

  • Termination caused due to redundancy - Employees are entitled to severance pay worth 15 days' average pay for every 1 year of continuous service or part thereof in excess of 6 months
  • Employees who are dismissed - Employers must pay termination benefits including leave accrued, gratuity payment (for employees with over 5 years of continuous service), payment in lieu of notice (if no notice is given), statutory bonus payment, and any other amounts due under the employment contract.
  • Employees who are terminated due to misconduct - No entitlement to notice pay or severance pay

To protect you from unforeseen financial risks arising from terminations, Deel applies a Severance Accrual to all employment agreements in this country.  Deel has extensive expertise in managing litigation risk globally and our Severance Accrual calculation is based on the prevailing common-law or statutory entitlements and local best practices. In the event your employee resigns or is not entitled to severance, all unused amounts will be returned to you.

Paid Time Off

PTO is established in the employment agreements. The minimum PTO is 18 days.

Public Holidays

National holidays include:

  1. New Year’s Day
  2. Lohri
  3. Makar Sankranti
  4. Republic Day
  5. Maha Shivratri
  6. Holi
  7. Ugadi
  8. Ram Navami
  9. Mahavir Jayanti
  10. Good Friday
  11. Eid al-Fitr
  12. Buddha Purnima
  13. Bakri Eid
  14. Muharram
  15. Rakshabandhan
  16. Independence Day
  17. Janmashtami
  18. Ganesh Chaturthi
  19. Onam
  20. Gandhi Jayanti
  21. Dussehra
  22. Eid-e-Milad
  23. Diwali
  24. Guru Nanak Jayanti
  25. Christmas

Onboarding

3 business days after MSA signature & deposit payment. 

Employment Contract Details

Contracts must be in English and can be bilingual. They must be in writing and signed by both parties.

A contract must include:

  • Name
  • Job role and job description
  • Leaves
  • Employee obligation
  • Termination conditions

Probation Period

Probation periods are not mandatory and there is no statutory requirement for employers to provide probation period. The standard probation period for India in the Employment Agreement is 6 months with the option to extend an additional 3 months at the employer’s discretion.
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Hiring in India, hassle-free

With Deel, your business can easily hire employees in India with our EOR solution. If you have an entity, our Global Payroll solution takes care of payroll and compliance for your direct employees. Our 250+ in-house experts handle everything from managing local laws, complex tax systems, or your payroll in India and 150+ countries.

Group (8)

599 USD

Management fee

Group (9)

5%

Estimate Employer Cost

*of employee salary

Want to learn the cost of hiring an employee in India?

View our Employee Cost Calculator

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