HR Solutions & Employee Relations in India with IRIS
IRIS HR Consulting has experience helping businesses grow in India. Without expert guidance, it can otherwise be risky and costly to leave local laws and legislation open to interpretation. For a scalable, compliant operation, IRIS can manage your HR in India to help businesses hire, recruit, and pay staff overseas in new, unfamiliar countries. As a popular destination for businesses, IRIS can navigate local barriers – from culture to compliance – to arrive at a rewarding opportunity for your business to thrive in this exciting marketplace.
Take your business to India with IRIS HR Consultancy.
Global expansion in India
With a compelling reputation, India in recent times has become an intriguing market for international business. Owed to its democracy, and favourable business reforms, India enjoys a buoyant economy that has spiked in recent years. The central government has been easing restrictions for FDI (foreign direct investment), which as opened the country to new and exciting partnerships and expansions. This means India is welcoming new business with its generous and progressive business reforms.
Outside of a significant consumer market, India is considered (digitally) competitive for its tech innovation in sectors like telecommunications, textiles, and pharmaceuticals. India’s workhorse reputation when in come to technological innovation is matched only by the US and China. The size and force of its markets are too attractive to ignore.
With analytical intrigue many have tried to understand the great Indian digital transformation. From mobile adaption, to social media, the rapid and sophisticated technological advances in India have spurred a reputation of its association with digital change. In fact, the central government let an initiative called “Digital India” to promote its internal infrastructures. The likes of Google and Microsoft have already begun to create inroads with the country in encouraging this growth to continue long into the future.
Establishing your business in India
Embarking on a global expansion is a strategic move to gain extra value from exciting foreign markets, which are constantly evolving and full of opportunity. But the international stage isn’t always easy to navigate.
Before entering the Indian market, you will need honor labor regulations, which have tightened over the years. Establishing a business in India will require local knowledge – everything from selecting a favourable location, to understanding tax schemes. Complying with these procedures can be easier when you partner with IRIS HR consultants – we can help you reach Indian markets.
Employment laws in India
When first expanding your business into India, navigating local laws, legislation and rules of employment laws is no easy feat. Throughout Asia and Europe, these laws are almost never universal. Rather, employment is dynamic and reflects the country social, economic, cultural opportunities.
For example, India’s federal structure means that there are both Central and State laws that govern issues of employment and labour within the country.
Did you know?
Labor laws and provisions can vary from state to state, which will influence the employments relations within specific locations.
Employment rights & contracts in India
Although a contract may be shored up verbally, it is common practice (and advisable) to capture employment conditions and terms in writing so as to avoid any ambiguity and firm up expectations. Some states may carry a statute that requires employers to issue an appointment order, which will contain the following details:
- names and addresses of employer and employee
- date of entry into employment
- rate of wages payable
Employment contracts are governed under the Contract Act, which ensures that certain criteria must be suitably completed in order for an employment offer and contract to be considered valid under Indian labour provisions.
Foreign nationals seeking employment must obtain an appropriate visa – typically an Employment visa – from an overseas Indian Consular Post in their home country prior to entering India to commence a role.
Hiring & recruitment in India
When getting your first international hire, you will need to negotiate terms of employment that comply with labour provisions within a state. But that requires local knowledge, strict compliance, and an understanding of what to include in an offer and thereafter – including before, during and after the commencement of an employment contract.
Equal Opportunities in India
According to Indian labour rules – outlined in Article 15 and 16 – all citizens are safeguarded from discrimination.
What are the working hours in India?
Working hours should not, generally, exceed 9 hours daily, or 48 per week. This may also be subject to any local provisions in the state specific labour laws per location of work.
Overtime in India
Any working time in excess of the standard hourly limits per day or month is considered overtime. In Kamataka, for example, limits are set at 9 hours daily or 48 hours per week, and working time accrued in excess is considered overtime. Overtime is not permitted across all states.
Sick Leave in India
According to local India laws, employers are obligated to provide for six days of sick absence per year. However, many organisations offer a different structure for longer term medical issues, instead offering unpaid leave.
Maternity Leave in India
All female employees are eligible for up to 26 weeks of leave under the maternity benefit, but this window can be extended for up to eight weeks prior to the expected delivery date. The remainder of time can be used after the childbirth.
For factory workers, the benefit is funded for by the government through social relief. In other scenarios, the employer will cover maternity leave and may offer more generous benefits in terms of additional renumeration during this period.
Public Holidays in India
India enjoys three public holidays:
- Republic Day on 26 January,
- Independence Day on 15 August, and
- Mahatma Gandhi’s Birthday on 2 October.
Other regions will, typically, enjoy further allowances for holiday leave, such as festivals. This may be region-specific, or holidays and festivals may be celebrated religiously.
Vacation or Annual Leave
The provisions for vacation or annual leave are governed under state-specific S&E (Shop and Establishment) Acts and Factories Acts (FA), which allows for “earned” or “privilege” leave.
Factory workers, having working over 240 days per calendar year, are entitled to one day of paid leave for every 20 days of work performed, which can scale up to 30 days of annual leave.
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Deliver your business to new, exciting markets with confidence and compliance.
End of Service
HR in India requires compliance not only during an employee’s service, but also at the end of it. End of service might include severance, termination, redundancy, and leaving packages. Or, for globally mobile companies with teams in foreign markets, this could be repatriation services for those returning from an assignment overseas.
For these more complicated matters, you will need expert HR guidance to navigate Indian labor laws and remain compliant.
Termination in India
Matters of termination must be captured in writing (and in accordance with the employment contract). The length on a given notice period will depend on length of service. For probationary workers, there is a mandatory 15-day notice. Thereafter, the minimum is 30 days.
For employers who have serviced beyond five years of service, there is typically a reward of gratuity payment (calculated at the salary against years of service).
Companies are expected to contribute to the following bodies:
- EPF (or Employee Provdent Fund)
- EPS (or Employee Pension Scheme, where the worker is employed by the government)
- EDL (or the Employees’ Deposit Linked insurance Scheme)
These collectively contribute to the likes of retirement funds, to which employees will supply separate contributions. This is a familiar model for taxation with split employer/ employee funding and contributions determined by the type of employee and their wage.
Basic Health Insurance in India
Insurance for health purpose in India is a mixture of public and private. A private scheme can be negotiated with, or requested by, employees, and this can be offered by organisations as a supplementary benefit to their employment.
Why Partner With IRIS?
When entering new, exciting countries like India, you will need an employment specialist to navigate the parts of local laws that are mandatory and those that are not. Delivering a compliant solution, IRIS can help your business arrive into new marketplaces whilst protecting your workforce – our partners can discover power and protection through us.
Overseas expansions can seem risky to those who dare it alone. Understanding the complexity of a fully compliant solution, IRIS can help businesses reach India.
Our cost-effective, knowledgeable approach to HR in India makes us an ideal partner to commence your overseas plans.