India is the world's largest talent pool for tech and services, with employment rules split across central and state laws. All-in employer cost runs around 1.17x the gross salary. Here is what to know before your first Indian hire.
Employment is governed by a mix of central statutes (Provident Fund, ESI, Payment of Gratuity, Payment of Bonus) and state-specific Shops and Establishments Acts. Appointment letters are standard, and social-security registration is mandatory above size thresholds.
Employer costs sit around 17%, driven by Provident Fund and, for lower-wage staff, Employees' State Insurance, plus gratuity accrual for longer-tenured employees.
PF is mandatory up to a wage ceiling and voluntary above it; ESI applies only below a monthly wage limit. Gratuity vests after five years of continuous service.
Employees pay income tax on a progressive scale (old and new regimes) plus their PF share, deducted at source (TDS). Withholding is the employer's responsibility, which under EOR means ours.
*All figures are estimates from public sources (2025-26), pending ops verification - same basis as the EOR cost calculator. Not tax or legal advice.
Compliant Indian appointment letter, payroll, PF/ESI, and benefits, handled. One invoice, flat $399 per month.