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SALARY PAYMENT IN Indian Rupee (INR)

CONTRACT LANGUAGES Hindi / English

PAYROLL TAX 16.75%

PAYROLL CYCLE Monthly

TIME TO HIRE 12 hours
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India

Simple, compliant hiring with Horizons PEO

Hire Employees in India - Overview

India has long been a popular destination for companies around the world looking to hire overseas employees: A huge talent pool, English proficiency, strong technical expertise and lower hiring costs all contribute to its reputation as a prime destination for international expansion and hiring.

Read our comprehensive guide to find out everything you need to know about hiring employees in India.

Facts & Stats

Population

1.412B (Labor Force 27.27 million)

Capital City

New Delhi

Languages Spoken

Hindi, Bengali, Marathi and English

Currency

Indian Rupee (INR)

GDP per capita

2.256,59 USD (2021)

Ease of Doing Business

63rd in 2022

Minimum Wage

178 INR ($2.61)/Day

5340 INR ($65)/Month

Average Wage

Ranges between 2000 INR – 70000 INR/Month

Paid Leave

12 working days annually

India: Business Environment

Business outlook

In 2022, India overtook the United Kingdom to be the fifth largest economy in the world. This is despite seeing significant declines in GDP (around 23.9%) due to the impacts of the COVID-19 pandemic between 2020 to 2021. For the 2022 financial year, India’s GDP increased 8.7%. For the year 2023, 4.7% has been forecast. With the world’s second largest population, India has a firm ground to conduct economic activities despite its developing country status.

Business regulation

Indian labor laws are also known as industrial relations. Although overall, Indian labor laws attempt to offer a certain level of protection to employees, this in practice can vary between states and the concurrent legal instruments in use that regulate labor issues at both the federal and state level. Currently, there are 44 labor laws consolidated within 4 legal codes including the Industrial Relations Code 2020, The Code on Social Security 2020, The Occupational Safety, Health and Working Conditions Code, 2020 and The Code on Wages 2019. These laws cover everything from the employee-employer associations, workplace health and safety requirements and employment standards. If you are looking to hire employees in India, it is important to understand the basic standards set out across these codes.

Business culture

In 2024, businesses in India more than often follow the traditional hierarchal model and prefer the use of appropriate and associated formal titles when addressing each person. Major decisions for a company will always be conducted at the highest level.

Despite English not being a dominant language across the country, it is widely spoken for doing business, especially in foreign business endeavors. Business it is widely spoken. It is also common for Indians to shake their head from side to side when they agree with you during a meeting or in general conversation.

Greetings can include the term “Namaste”, traditional handshakes, or unique to the Indian culture, a gesture that involves pressing your palms together with your fingers pointed upwards, followed by a slight bow. In Indian culture, using the right hand for numerous activities, including business-orientated gestures such as receiving or handing a business card over, is mandatory and a sign of respect. Indians also place huge importance on building business and personal relationships.

Recruiting employees in India

Recruiting employees in India – Overview

Indians put a lot of emphasis on personal and business relationships, so word of mouth referrals are a most common recruitment method, outside of the newer online recruitment tools. In saying that, the recruitment pool in India is highly competitive with many candidates with top skills seeking jobs. To find top talent in India, there are a plethora of job sites if hiring from abroad that you can post your ad to, including LinkedIn, Naukri, Monster India and Indeed.

Most important recruitment tools in India

Naukri
https://www.naukri.com
Naukri was founded in 1997 in India and currently operates in across India and the Middle East. It is the largest employment platform in India.

Monster India
https://www.monsterindia.com
Monster is a global online employment platform that connect employers and prospective employees through its job board. It is headquartered in Hyderabad, India.

LinkedIn
https://www.linkedin.com
LinkedIn gets a mention as it is one of the world’s most popular job network and recruitment platforms. You will find some of India’s top talent on this platform.

Interviewing employees in India

Interviewing employees in India – Overview

Depending on the seniority of the role and what industry will determine what is expected when interviewing candidates in India. However, it is common to have at least 1-2 interviews and some psychometric testing to narrow down candidates for a final interview. Candidates may have past experiences with harsh interview styles from previous roles they have gone for or been offered by traditional Indian companies. Due to this, Indian candidates are usually well prepared for interviews and take them seriously to try and avoid feeling uncomfortable or feeling inadequate during an interview.

Can I ask the candidate’s previous salary in India?

You can ask a candidates previous salary during the recruitment process in India as there is not law forbidding it. On the other side of that though, candidates do not have to answer either.

What is the typical salary increase at a new job in India?

Typically when a candidate is changing jobs, a 10-20% salary increase is expected. This will vary though, depending on the type of work and skillset a candidate has. In demand skills can see higher salary jumps when changing jobs.

Onboarding employees in India

Onboarding employees in India – Overview

India is overhauling their onboarding processes by introducing more effective onboarding processes to ensure lower turn-over rates and to ease the new employee into the company after their (usually) gruelling interview process. The process can typically last anywhere from a few weeks to a few months depending on a candidates training needs and job-role level. It begins formally on the offer of employment.

Generally, it is uncommon for a new employee to negotiate an offer once it is received. It is also a common expectation of employers of a prospective employee for them to acknowledge, accept and sign the offer as soon as possible. Once an offer is accepted, the employee will be given information in terms of an office tour, links to any training or access to any official working systems. When an employee comes in for their first day, HR will get the employee to sign off on any employment forms required to be submitted and go through company policies relevant to their position.

Best remote working tools to use in India

Indian companies embrace some of the more common global remote working tools that are highly used currently and popular including Slack, Skype, Zoom, Join.me, Base Camp and Asana.

Holiday season in India — 2024

Holiday Schedule in India [2024]

There are three statutory national holidays in India, where all organizations must remain closed. These holidays are:

Date	Holiday name
1 Jan., 2024	New Year’s Day
26 Jan., 2024	Republic Day
25 Mar., 2024	Holi
29 Mar., 2024	Good Friday
21 Apr., 2024	Ambedkar Jayanti
10-11 Apr., 2024	Ramzan ID
01 May, 2024	Maharashtra Day
15 Aug., 2024	Independence Day
26 Aug., 2024	Janmashtami
07 Sep., 2024	Ganesh Chaturthi
02 Oct., 2024	Gandhi Jayanti’s Birthday
12 Oct., 2024	Dussehra
31 Oct., 2024	Diwali
25 Dec., 2024	Christmas Day

Unlike other countries, If a public holiday falls on a weekend, the holiday does not move over to the next working day.

What is the typical salary increase employees in India expect?

Salary increases vary each year in India but typically an increase of between 8% to 11% is standard. In 2022, salaries are expected to increase by more than 9%, especially across the technology, retail and consumer products sector. In 2023, a 10.4% salary increase is forecasted.

FAQs

Should I hire freelancers or employees in India?

The main thing to know about hiring employees in India, is that you must have a legal entity set up in India, or use a compliant alternative, such as an India Employer of Record solution.

Hiring freelancers or contractors in India can be a good option for short-term or project-based work, but it is important in doing so to ensure full compliance with independent contractor rules.

Can I hire foreigners in India?

There are two caveats to hiring foreigners in India, this is the abovementioned need to have your own legal entity set up in India, and that the foreigner is on the appropriate working visa and a legal resident in India. If you need to send any of your current employees to work in India, you can use the support of an EOR to help get your employee set up and ensure you meet all your obligations under Indian labor law.

How do I open a India subsidiary or branch office?

Foreign entities that want to have operations out of India or legally hire employees in India must have a legal entity set up in the form of either a subsidiary company, branch or a wholly owned subsidiary company.

To open a branch offices, you’ll need an Indian resident responsible for all legal filings. Branch offices have limited working capabilities in India, but can act as a representative for a foreign parent company and conduct the same activities as the foreign parent company.

The processes and requirements to open either a subsidiary company or wholly-owned subsidiary company are different.

For a foreign entity to open a subsidiary company under an Indian parent company, must hold at least 50% shares in the company. This will mean the company will be subject entirely to Indian labor laws and be a Private Limited Company (PLC). The company will be treated as a separate entity to the parent company when it comes to income tax. The director of the subsidiary must apply for a Directors Identification Number (DIN).
For a foreign entity to set up a wholly owned subsidiary company, they must have 100% ownership and it be in a sector that allows 100% foreign investment. At least one of the directors must be of Indian residency and all directors whether local or foreign need to apply for a DIN number.

How do I hire employees in India?

You can easily hire employees in India if you have a subsidiary or branch set up. You can also use the support of a global PEO/EOR such as Horizons to hire local Indian employees and get them to take over the management and payroll requirements of your Indian employees.

Hiring in India, Made Easy

Your business can easily hire employees in India without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.

Success stories from businesses we’ve helped enter and grow in new markets.

Client Testimonials

"As a seed-stage, London-based startup, we were initially hesitant to expand internationally due to the administrative workload involved. Horizons took the headache out of the process, allowing us to hire a team of software engineers in Germany."

Gabor SzedlakCo-founder & COO at MindLabs (UK)

"I truly appreciated the thoroughness and the professionalism of Horizons personnel while we hired internationally with them. They were knowledgable on all subject matters pertaining to international employment."

Gary PaskyVP Software Development, PICS ITech (USA)

"On deciding to begin commercial activities in Asia Pacific, we needed a provider to handle the employment and remuneration of our workforce. With Horizons the result was fast, efficient, and fit-for-purpose. We recommend Horizons as an EOR provider.”

Chris MorrellManaging Director, Schaeffler Group (Germany)

"The collaboration with the Horizons team is excellent. Both our local employee as well as our HQ in Germany are more than pleased with the support provided and the simplicity of the service. We can highly recommend the Horizons solution to anyone."

Christoph EngelbertCo-Founder & CTO, Clevabit (Germany)

"We needed an EOR that could provide expert support for payroll in APAC. We are pleased with Horizons’ expertise and the fact that they are flexible, responsive, and easily accessible from Belgium. They were able to provide services within the short timeline we required."

Katia FlamandHuman Resources, Devian Chemicals (Belgium)

hire employees in

India,
made easy

Simple, compliant hiring with Horizons PEO