返回
From
$249/month
$49/month
2% of gross salary / month
Horizons provides compliance solutions to ensure your business in India operates in line with Indian labor laws and tax regulations. Businesses benefit from hiring in, investing in, or job outsourcing to, India in a range of industries, from customer service, to accounting services, to software development.
We also process monthly payroll, and, as an India Employer of Record, absorb all local employer liabilities. Partnering with our India EOR is the quickest and most cost-effective way to enter the Indian market.
Note, an India Employer of Record is also known as an India Professional Employer Organization (PEO).
Hire in India, and pay employees through our platform or app.
Our India EOR solution is the most affordable on the market.
Fast onboarding in India, hire in as little as 12 hours.
We draft labor contracts compliant with India labor law.
We administer all mandatory benefits and contributions in India.
It doesn’t stop with India — we are an international EOR
While not a strict legal requirement, it is highly recommended that employees be hired under written employment contracts in India. This clearly establishes the legal rights and responsibilities of employer and employee, as well as reducing the probability of an employment dispute.
If there is no written employment contract in place, there is also a risk that a court would read implied terms into the contract which favor the employee over the employer.
Employment contracts should state the employee’s base salary, as well as any allowances, additional compensation and severance payments. The contract should also state all employee responsibilities, and how contract termination and renewal are to proceed. All references to monetary value should be made in Indian rupees (INR).
While not compulsory, it is common for employees in India to expect a salary increase of 10%-15% per year. Stepwise pay increases should be clearly established in the terms of the written employment contract.
Probationary periods are also common in India. Three months is a typical length, which is also the maximum initial probationary period. However, employers can choose to extend this period for up to three more months. During a probationary period, 15 days written notice is required for employees or employers to end employment.
When you engage Horizons’ India EOR solution, we ensure that all employment contracts are Indian labor law compliant.
3 – 6 months (standard) 2 years (maximum)
30 – 90 days standard (depending on seniority)
“Gratuity” paid at end of contract (if included in Cost to Company, or CTC, agreement): 0.58 monthly salary per year of service ‘Retrenchment‘ compensation: 15 days per year of service
3 – 6 months (standard) 2 years (maximum)
30 – 90 days standard (depending on seniority)
“Gratuity” paid at end of contract (if included in Cost to Company, or CTC, agreement): 0.58 monthly salary per year of service ‘Retrenchment‘ compensation: 15 days per year of service
The standard Indian work week is 40 hours, and the average work day is eight hours.
Maximum daily and weekly working hours under Indian labor law, depend on the industry in question. For example, for those employed in factories, the Factories Act 1948 specifies that hours in excess of 9 hours in a day or 48 hours in a week need to be paid twice their ordinary rate.
For those employed in mines, the Mines Act 1952 specifies that workers should work more than 10 hours in a day or 50 hours in a week, including overtime.
Employees in India are entitled to a number of public holidays (also known as ‘statutory holidays’, depending on the state in question. There are three national public holidays that apply across the country: This covers Republic Day, Independence Day and Mahatma Gandhi Jayanti. Other paid holidays vary by state, local custom, industry/sector and religion, and overall, amount to 10-20 days per year. For example, central government employees are entitled to 17 public holidays in 2025 (14 specific mandated days, and three that can be chosen from a list).
India has a range of national public holidays that are celebrated annually. In 2025 these holidays are:
| Date | Holiday name |
|---|---|
| 1 Jan Monday | New Year’s Day |
| 6 Jan Monday | Guru Gobind Singh Jayanti |
| 12 Jan Sunday | Swami Vivekananda Jayanti |
| 14 Jan Tuesday | Makar Sankranti (Pongal or Uttarayan) |
| 15 Jan Wednesday | Thiruvalluvar Day |
| 26 Jan Sunday | Republic Day |
| 2 Feb Sunday | Vasant Panchami |
| 12 Feb Wednesday | Guru Ravidas Jayanti |
| 19 Feb Wednesday | Shivaji Jayanti (Chhatrapati Shivaji Maharaj Jayanti) |
| 26 Feb Wednesday | Maha Shivratri |
| 28 Feb Friday | National Science Day |
| 13 Mar Thursday | Holika Dahana |
| 14 Mar Friday | Holi |
| 28 Mar Friday | Jamat Ul-Vida |
| 30 Mar Sunday | Ugadi/Gudi Padwa |
| 31 Mar Monday | Idul Fitr (Ramzan Eid) |
| 6 Apr Sunday | Ram Navami |
| 10 Apr Thursday | Mahavir Jayanti (Mahavir Janma Kalyanak) |
| 14 Apr Monday | Dr. B.R. Ambedkar Jayanti (Dr. Babasaheb Ambedkar’s birthday) |
| 18 Apr Friday | Good Friday |
| 20 Apr Sunday | Easter Sunday |
| 21 Apr Monday | Easter Monday |
| 1 May Thursday | May Day / Labour Day |
| 12 May Monday | Buddha Purnima / Vesak |
| 7 Jun Saturday | Eid-ul-Zuha (Bakrid) |
| 9 Aug Saturday | Raksha Bandhan |
| 15 Aug Friday | Independence Day |
| 16 Aug Saturday | Janmashtami |
| 27 Aug Wednesday | Ganesh Chaturthi / Vinayaka Chaturthi |
| 5 Sep Friday | Milad un-Nabi / Id-e-Milad |
| 29 Sep Monday | Maha Saptami |
| 7 Oct Tuesday | Maharishi Valmiki Jayanti |
| 20 Oct Monday | Diwali |
| 22 Oct Wednesday | Govardhan Puja |
| 23 Oct Thursday | Bhai Duj |
| 31 Oct Friday | National Unity Day |
| 5 Nov Wednesday | Guru Nanak Jayanti |
| 8 Nov Saturday | Kanakadasa Jayanti |
| 24 Nov Monday | Guru Tegh Bahadur’s Martyrdom Day |
| 3 Dec Wednesday | World Disabled Day |
| 25 Dec Thursday | Christmas Day |
Employers in India are required to contribute to the Employee Provident Fund (EPF) which is a state pension fund, funding the Employee Pension Scheme. Employers are also required to contribute to the Employees’ Deposit Linked Insurance Scheme (a life insurance scheme). Employers contribute 3.67% of an employee’s salary to this EPF. Employees contribute 12% of their salary to this fund. Additionally, employers contribute 9.94% to other social insurances. This rate is calculated through the employee’s base salary, excluding all allowances. Income tax is applied to an employee’s salary, according to the following structure:
In addition to employee income tax, other taxes that any business expanding into India needs to take into account includes:
In India, health insurance is a hybrid of public and private insurance. Some employees may request a health insurance allowance as part of their compensation.
The statutory minimum paid vacation leave in India is 18 days per year, with an additional 7 days of paid ‘casual leave’, making it a total of 25 days.
Paid sick leave depends on the state in question, but is usually around 7 days of paid leave per year. It is quite common for employers to offer unpaid leave for long-term medical issues, but this is not required by law.
There is an additional 8 days leave available every year as ‘casual’ leave. This is paid leave which the employee can take at their discretion.
Female employees are entitled to 26 week’s maternity leave in India. Leave can be taken up to eight weeks before an expected delivery date, while the remaining leave can be taken after childbirth. Female employees are also entitled to a medical bonus of 3,500 Indian rupees.
Note, paid maternity leave is only owed to women who work for organizations of 10 or more employees. Note also, that for the second or subsequent employee, the mother is eligible for only 12 weeks of maternity leave.
If a woman is is classified as a factory-level employee, maternity leave is paid for by the government’s social funds. Otherwise, the employer is responsible for payment of all maternity leave.
Although India does not mandate paternity leave, some employers may offer it as a benefit.
An India Employer of Record ensures that employees receive all the paid and unpaid leave that they are entitled to under the law.
It is common in India for many elements of the employment relationship to be negotiated in advance between the potential employer and employee.
As with all business negotiation, this means taking into certain features of Indian business culture. First, Indian companies are often hierarchical in nature. This may mean that negotiations take longer than they would in other countries due to the need to get sign-off at multiple levels of the organization. This is especially true if a business relationship is not already in place.
Second, Indians themselves may be more likely to communicate indirectly than individuals from other countries. For example, they may be disinclined to say “no”. Instead, they may be more likely to use terms such as “possibly” or “perhaps.”
Job titles are also important to people in India. Culturally, higher titles command higher respect: The premium placed on job titles in India should be considered when negotiating any employment contracts within the country.
Benefits and allowances in India are crucial for potential employees seeking to maximize their take-home pay. These allowances and benefits are pre-tax and may contribute up to 60% of the total compensation package. One way of thinking about it is that what might be thought of as “gross pay” in other countries is tantamount to “base pay” in India.
The total amount paid by a business for employee compensation, allowances and benefits, is often referred to as the ‘cost to company’ or ‘CTC’, in India.
In addition to these allowances, some Indian workers may receive incentives and bonuses that are based on performance. These allowances are taxable.
Many foreign companies prefer to offer a gross amount of compensation and elect for their EOR to structure a compensation package in the most tax-efficient manner. This is due to the components of a compensation package being affected by whether they are taxed or tax-free.
An India Employer of Record can ensure that all staff receive benefits which are compliant and market competitive.
In India, employers must provide written notice before terminating an employment contract. 30 days is the typical period of notice. However, employers can elect to pay employees in lieu of a notice period.
Employees are entitled to 15 days’ wages for each year’s company service. This is unless they were terminated due to:
If an employee has served for five or more continuous years, they may be entitled to a gratuity payment. This payment is equal to an employee’s last drawn salary x 15/26 x No. of year’s service.
By partnering with our India EOR, Horizons’ team of local experts can provide assistance for drafting strong employment contracts that are compliant with local regulations.
In India, the minimum wage varies by state and sector. For example, Delhi’s minimum wage for unskilled workers is INR 16,506 per month.
Employers are required to provide employees with payslips (sometimes called ‘pay stubs), and in most circumstances, payment is deposited into an employee’s bank account.
Employees in India are typically paid on the 1st of each month. The Wages Act stipulates that businesses with less than 1,000 employees should administer wages before the 7th of every month. For businesses with more than 1,000 employees, wages should be administered before the 10th of every month.
Due to salary inflation, many employees in India expect wage growth of between 10% – 15% per year. While India’s compensation laws do not mandate this wage growth, employees are unlikely to stay with a business if they do not receive this pay rise.
| Minimum Wage Country Comparison Chart | (Per month in USD) |
| Switzerland (Geneva) | $4,000 |
| Italy | $2,255 |
| Australia | $1996 |
| Algeria | $156 |
| Uzbekistan | $22 |
To maintain a successful benefit management strategy, employers in India should be mindful of guaranteed benefits. As an example, health insurance in India is typically a combination of public and private insurance. While employees are entitled to public health benefits, they may also request a private supplementary plan as part of their benefits.
Employees receive paid time off that includes 10 paid public holidays. Three of these days are set nationally, while the rest will vary between states, local customs, and religions. The statutory minimum for paid vacation is 15 days.
Female employees in India are eligible for 26 week’s maternity leave.
An India EOR ensures that all employees in India receive the benefits they are entitled to under the law.
Businesses seeking to expand into India need to budget for supplemental benefits. These benefits can influence an employee to accept a position and to remain with an employer. Supplementary benefits in India can include :
It is increasingly common for employees in some industries in India (such as IT) to be part of an employer-provided Employee Stock Options Plan. Management of such a plan can also be facilitated by an India EOR.
Horizons’ India EOR solutions include a benefits management service which will source the most competitive benefits for your employees.
For businesses expanding into India, the emphasis on variable allowances and benefits in negotiating an overall compensation package can be daunting. Employers are generally prohibited from hiring and paying employees without first establishing a subsidiary in India. To establish such a subsidiary, and to ensure that hiring is compliant with local rules for allowances and benefits, could take months, causing significant business delays.
With Horizons’ India Employer or Record solution, businesses can begin operating in India in as little as 48 hours. Horizons acts as the legal employer of your workforce in India, meaning there is no need to establish a subsidiary there for the purposes of employing staff. And as the only global EOR with an in-house recruitment team, we can help you source, hire, and onboard top local and international talent.
Hire borderless talent with Horizons
With Horizons, you get quick service, transparent pricing, and expert support.
Generally speaking, the terms “India PEO” and India EOR” are used interchangeably.
In most cases, Horizons’ India EOR can hire & onboard your employee within 24 hours. The actual start date of the employee will depend on their notice period obligation to their previous employer as well as any relevant hiring rules in India.
It is possible to get a work visa in India. Horizons’ Global Mobility team is a dedicated team of work visa experts. They assess the details of each case to determine feasibility and costs before Horizons applies for the work visa on behalf of your employee. If the Global Mobility team determines that your case is feasible, the process is smooth and transparent. Visa spots in India are limited, however—get started today to secure your employees’ visa spot.
Holiday Schedule in India [2025]
