India, officially the Republic of India, is the second-most populous country in the world. It covers an area of 3.29 million square kilometers. The country is surrounded by the Bay of Bengal in the east, the Arabian Sea in the west, and the Indian Ocean in the south. India occupies a major portion of the South Asian subcontinent. There are 28 states and eight Union territories in the country. The agricultural sector remains the country’s main employer. However, it is no longer the largest contributor to GDP. Major growth has been in trade, finance, and other services.

 

*Please note that the official currency is the currency of remuneration when employed through WorkMotion in India.

Capital :
New Delhi
Currency :
Indian Rupee (₹, INR)
Languages spoken :
Hindi, English
Population :
1.39 billion (2021 est.)
Minimum wage 2022 :
Differs across individual states
Cost of Living index :
$ (137 of 139 nations)
Payroll Frequency :
Monthly
VAT - standard rate :
Exempt-18%
GDP - real growth rate :
8.9% (2021 est.)

Statutory Holidays

Workers are entitled to paid holidays for National and Public holidays (often called “festival holidays”). The total number of paid holidays depends on the specific Shops and Establishments Act governed by the state. The pay on holidays also varies depending on the specific Shops and Establishment Act.

 

The table below shows the public holidays observed by WorkMotion India.

The holidays mentioned below are valid for the year 2022.

Date
Holiday Name
Extra Information
January 26
Republic Day
National Day
April 15
Good Friday
Religious Festival
May 3
Ramadan
Religious Festival
August 15
Independence Day
National Holiday
August 31
Ganesh Chaturthi
Religious Festival
October 2
Gandhi Jayanti
National Holiday
October 5
Dussehra
Religious Festival
October 26
Deepavali
Religious Festival
November 1
Rajyotsava

Contract Sharing Time


The approximate time for sharing the contract with an employee in India is 4 business days assuming no special requests or changes to our standard employment contract. Any such requests or changes would need to undergo internal and external review, directly leading to a time delay.

NOTE: This number is subject to change and is only an estimation of the Contract Sharing Time. The estimated Contract Sharing Time begins from the moment that WorkMotion has received all required information from both the client and the employee.

What You Need To Know


  • Remote work is not legally defined in India, but the Ministry of Labor and Employment made its first attempt to legally define “working-from-home” by issuing a draft standing order in January 2020 for organizations with 300 or more employees.
  • It is not mandatory for employers to purchase accident insurance, but employers must provide compensation to their employees in cases of injuries, accidents, or death.

  • Employers whose employees are not covered under the Employees’ State Insurance Act of 1948 are required to have Group Health Insurance or other medical insurance for their employees.

Labor Conditions


Working Hours

The normal working hours and days for the employee must be clearly stated and included in the employment contracts. Usually, the Shops and Establishment Acts (SEAs) of different states provide provisions for working hours for the private sector.

Overtime

Any hours that are worked above the contractually defined normal working hours are considered overtime.

The employer should pay the employee for work on any day in excess of the number of hours constituting a normal working day, at not less than twice the normal wages, for every hour or for part of an hour so worked in excess.

Probation Period

Probation is not mandatory. The common practice is three to six months depending on the seniority of the position.

Termination Notice Period

There are both national-level and state-level regulations. The common practice is to give 30 days’ notice. For senior positions, the notice period is up to 90 days. However, the notice period can be shortened via mutual agreement.

 

Leave / Time Off

Annual Leave

Though variations appear between the national and state legislation, the length of annual leave usually ranges between 12 and 15 days per year.

Sick Leave

There is no central legislation explicitly mandating “sick leave”, so employees in practice use their annual leave to cover periods of sickness after working at least 240 days or more during a calendar year. The pay is as if they are taken as annual leave.

Parental Leave

There is no statutory provision for parental leave.

Maternity Leave

The maximum period for which any woman should be entitled to maternity benefit is 26 weeks, of which not more than eight weeks should precede the date of her expected delivery.

Paternity Leave

There is no legal requirement for private-sector employers to offer paternity leave.

Other Types of Paid Leave

There are no other types of paid statutory leave.

Unpaid Leave

Any leave taken outside the conditions for any form of paid leave is classified as unpaid leave. The leave has to be authorized by the employer.

Statutory Benefits

Both the employer and the employee are required to contribute 12% to the Employee’s Provident Fund respectively. Yet, the employer must withhold the contributions for both parties and deposit the contributions (total of 24%) to the Provident Fund by the 15th day of the following month.

The full contributions breakdown is as follows:

Social Security Benefits
Employer Contributions
Employee Contributions
Employee’s Provident Fund
12%
12%
Health Insurance
3.25% (If employees earn Rs 21,000 or less per month); or
0.75% (If employees earn Rs 21,000 or less per month); or
Group Health Insurance or other medical insurance (If employees earn more than Rs 21,000 per month)
None (If employees earn more than Rs 21,000 per month)

Health Insurance

Employee State Insurance (ESI)

The ESI scheme applies to all factories and other establishments where 10 or more persons are employed or were employed on any day of the preceding 12 months.

Employers contribute 3.25% to the ESI scheme, while employees contribute 0.75%.

Group Health Insurance

Employers whose employees are not covered under the ESI scheme are required to have Group Health Insurance or other medical insurance for their employees.

Other Insurances

Accident Insurance

If personal injury is caused to an employee by accident arising out of and in the course of their employment, the employer is liable to pay compensation.

Unemployment Insurance

Employers are not required to purchase unemployment insurance for employees.

Public Pension

The employer and the employee each contribute 12% to the Employee’s Provident Fund Scheme (EPFS) per month respectively.

The retirement age in India is 58 years old for workers in the private sector.

Other Statutory Benefits

Employees’ Deposit Linked Insurance Scheme (EDLIS)

Anyone who contributes to the Employees’ Provident Fund (EPF) is automatically enrolled and entitled to benefits from EDLIS.

Disclaimer

The information contained in this Country Guide is provided for informational purposes only and should not be construed as legal advice on any subject matter. The contents of this Country Guide contain general information and may not reflect current legal developments or address your situation. You should not act or refrain from acting on the basis of any content included in this Country Guide without seeking the advice or representation of a licensed attorney. WorkMotion Software GmbH disclaims all liability for actions you take or fail to take based on any content included in this Country Guide.

Information provided in this Country Guide is provided “as is” without warranty of any kind, either express or implied, including without limitation warranties of merchantability, fitness for a particular purpose, or non-infringement. WorkMotion Software GmbH periodically adds, changes, improves, updates, or removes information without notice, and assumes no liability or responsibility for any errors or omissions in the contents of this Country Guide. This Country Guide may contain links to other websites. WorkMotion Software GmbH disclaims all liability for the privacy practices or the content of such websites.

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