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Current Region & Language
Current Region & Language
Currency
Indian Rupee (INR)
Employer Taxes
Employers contribute about 12% of basic salaries towards EPF, plus additional contributions for ESI (if applicable).
Payroll Frequency
Monthly
Language
Hindi, English
Date Format
DD/MM/YYYY
India By The Numbers
1.4 million
Population
INR 240 trillion
GDP
7
National Holidays
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Weekly Working Hours
National Holidays
India has three national holidays. The country celebrates:
Republic Day – January 26th, Independence Day – August 15Gandhi Jayanti – October 2
There are multiple gazette holidays and restricted holidays. The observance of the restricted and gazette holidays can vary by region.
Leave
In India, annual leave entitlements vary by state, typically ranging from 12 to 15 days per year, depending on the length of employment and state-specific regulations. Female employees are entitled to paid maternity leave for 26 weeks for the birth of their first two children. If an employee has already had two surviving children, she is entitled to 12 weeks of paid maternity leave, provided she has worked for at least 80 days prior to the expected delivery date. In addition, most states provide for statutory sick leave and casual leave, with casual leave being a paid leave intended for emergencies.
Employment Contracts
In India, there is no federal legal requirement to have a written employment contract. However, some state-specific legislation mandates that an “employment letter” be issued. This letter should typically include essential details such as the name and address of the employer, the job title and nature of work, probation terms (if applicable), wages and salary details, the date of commencement of employment, the type of employment (whether permanent or fixed-term), and leave entitlements. While this document is not legally required at the national level, it helps clarify the terms of employment for both parties.
Types of Employment
There are two types of employment: Employees and Independent Contractors.
Employment Costs
IC Class Factors
Labor Leasing
In India, deployment of contract laborers at an establishment is governed by the Contract Labor (Regulation & Abolition) Act (CLRA).
The CLRA applies to only those contractors who employ at least 20 (5 or 50 in select states) or more workmen.
If the CLRA becomes applicable, both the principal employer and the contractor are required to obtain relevant registrations/licenses from the labor authorities for engagement and deployment of contract labor respectively.
Minimum Wage Requirements
Minimum wage varies from region to region and yearly.
The minimum wage to which an employee is entitled depends on the nature of the employment, industry, geographic location of employment, and employee’s age.
Medical Benefits
There are no specific requirements regarding medical benefits.
Probationary Periods
Probation periods are not legally required but commonly last 3 to 6 months. In most government jobs in India, the probation period is typically two years.
Termination Notice
For workmen, the notice period is generally 1 month or salary in lieu of notice for most commercial establishments, and 3 months for certain establishments like mining, factories, and plantations, provided there is 1 year of continuous service. If the contract specifies a longer notice period, that longer period applies. For non-workmen, the notice period is determined by the contractual terms.
Severance
Workers who have been in continuous service for at least one year (240 days) are entitled to retrenchment compensation, calculated at 15 days of average pay for each completed year of service or any part thereof exceeding six months. For non-workers, severance payments are determined through mutual agreements between employers and employees.
Pre-hire Checks
There is no legal restriction on performing pre-hire checks in India, however it is mandatory to comply with privacy laws and anti discrimination laws. Immigration check is required for foreign nationals. Other checks such as health records, employment history, drug and alcohol tests etc. may be conducted based on the industry and employer’s discretion.
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