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How to hire remote employees in
Laws about hiring are complicated, and the same is true in India. But there are ways to sidestep the headaches—if your company hasn’t already established a physical presence in India, you have two real options when it comes to hiring. We’ll detail both below.
If you want to successfully hire in
India
, you have two options:
Laws about hiring contractors are significantly more simple in
India
. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Thera for.
This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in
India
is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.
Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in
India
.
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
Hiring contractors in
India
means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
If you’re hiring contractors in
India
, you can pay them with Thera in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in India than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in India.
There are 3 national holidays where businesses must be closed; Republic Day, Independence Day, and Ghandi Jayanti. In addition to this, each region has their own public holidays that are observed
Employees are allowed a maximum of 15 paid sick leave days a year and receive 70% of their average daily wage.
Employees receive 100% of their average wage in the six months prior to childbirth. The amount of fully paid time leave depends on the number of children an employee has.
First 2 children – 26 weeks paid
3 or more children – 12 weeks paid
New fathers are entitled to 2 days’ leave for the birth of their child or a miscarriage.
There are no statutory laws for parental leave.
Casual leave: provided for urgent and unexpected matters. Typically companies have a strict maximum of three days a month, and 6 yearly. Casual leave is not encashable. At the end of the year, unused leave lapse automatically.
Work-related injury leaves: Work injury benefits come from the contributions made towards the employees’ compensation and employees’ state insurance. Temporally disabled workers receive 50% compensation monthly.
None.
None.
If termination isn’t specified in a contract, an employer must give 30 days’ notice or payment in lieu to an employee who has worked for at least 3 months. No notice is required for termination due to misconduct.
A 30 days’ notice period should be given.
Severance payment is given to workers who have been continuously employed for 2 years and are terminated for redundancy. Severance payment reflects the duration of employment, performance, and salary.
None.
A full-time workweek is 48 hours.
Overtime is paid double the rate of the normal pay.
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