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Hiring employees in India: A guide for foreign companies

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Are you on the lookout to set up your remote team from a huge pool of talent and highly qualified individuals? Is India your prospective location considering its potential attraction? Then let us guide you on understanding the employment culture, the process of how to hire employees in India for your foreign company, and how a PEO (Professional Employer Organization) can serve as the best alternative for your hiring process.

Hiring employees in India of high caliber talent

Esteemed businesses like Zapier, GitLab, Buffer, and Hubstaff are known for hiring 100% remote teams. Research suggests that 95% of employees are hired locally in India by foreign firms. Considering these statistics and by following the lead, you will have access to the second-largest English-speaking population with a high literacy rate. A 1.3 billion dynamic market to choose from and where business is primarily conducted in English. A great tech talent, with 4000 engineering colleges churning out a remarkable 1.5 million engineers every year.

Also “Indians are perceived as ready to adapt to different cultures, diligent and increasingly open to relocating”, as quoted by Kamal Karanth, Managing Director of the Indian arm of global recruiting agency Kelly Services.

While sourcing talent from India, considering the following aspects will come in handy for your foreign company hiring process.

Decoding the Employee Mindset in India

When you decide to hire employees in India, it is important to understand the Indian work culture. Indian employees working for Indian or multinational companies like to enjoy 10% to 50% hikes annually. Accompanied by favorable taxation, incentives, travel allowances, health insurance coverages, etc. They prefer five working days, and 15-30 days of public holidays. They also like modern office spaces and futuristic office spaces for more comfortable working conditions.

  • Recruitment or staffing scenario in India

As a foreign company owner, you will need to understand the Indian business culture that will determine your company’s HR practices. You will have to take into account the employees’ cultural and religious backgrounds to devise a strategic HR practice to deal with them.

Indian employees value job security, so they look for long-lasting and secured opportunities. For most of the employed population, their designations or positions are very important. It is seen as social status and also a criterion for being eligible for a mortgage. The ‘freelancing’ concept is not seen as a desirable state of employment here and contract employment is approached as the last resort. The salary packages include all elements of pay in a corporate structure known as a CTC (cost to company) with differing tax requirements like the PF ( Provident Fund). 

You can offer your employees perks like stock options, overtime compensations, incentives, and internet allowances to make them feel valued. So if you are looking to hire employees from India, you must offer them attractive salaries, benefits, and a long-tenured job offer.

  • Understanding the work hours, holidays, and overtime pay in India

Your remote employees will work for you for 8-9 hours per day or a max of 12 hours as per the new government labor laws. You will also have to consider the Indian calendar holidays while designing the leave management system, since many festivals are celebrated here. Also, you will have to pay your employees for overtime as per the Minimum Wages Act, 1948. To know about it more in detail, visit for more information. So if you wish for your remote employees to work for you after COB (closing of business) hours, you will have to consider the Indian employment working laws, their festivals, and overtime compensations.

  •  Ways of hiring employees in IndiaIndia’s online job portals and social media-based recruitment

Online job sites are a great way to source junior to mid-level executives. According to Statista research, 21% of employers in India look out for candidates on job portals as of 2020 data. You can selectively choose from a high volume of responses from these portals. You can save time by specifying the job description and qualifications. It is ideal to tailor the job descriptions and compensations to the expectations of the candidates by studying the Indian market trends. You can use platforms like Indeed , Fresherslive  , Naukri , and Toptal. to directly reach out to prospective candidates.

Finding the right talent through social media recruiting platforms has been a growing trend. LinkedIn showcases a database of 65,090,000 people recruited from India as of 2019. You can use platforms like LinkedIn, Facebook career pages, Twitter, Google+, and Branchout to source the both active and passive candidates.

  • PEO/ EOR in India is the best option for hiring employees for foreign companies

If setting up your subsidiary company is not your first step, then engaging with a PEO or EOR i.e. a Professional Employer Organization or Employer of Record as co-employment will be beneficial. A PEO is a great way of going about hiring employees in India without forming an Indian office. These organizations offer the best of both worlds by becoming a legal employer for your Indian staff. A PEO will source the right candidate for you. They know the Indian market well and have better access to the talent pool here. With the PEO model, your company can focus on the core business and let the administrative headaches be handled by the PEO service companies.

The PEO alternative will prove as a great stepping stone to your business expansion strategy without having the need to form a foreign subsidiary immediately.

Remunance, your partner in hiring employees

At Remunance, we know the relevance of maintaining and retaining talent for a successful business. Remunance services help global companies to enter the Indian market. We maximize risk management capacity by being your ally in India. We will kickstart your business operations with complete HR Admin, and office infrastructure support all over India. Our team of HR professionals follow a structured recruitment process to improve hiring efficiency. We will ensure you a winning team culture by suggesting an ideal selection process.

Take your business to the next level and leave the hiring concerns to us.


This blog is made for information purposes. Everybody is requested to get advice from an expert before making a decision based on the information given in the blog. Remunance disclaims any liability/loss or damage caused by using the information, directly/indirectly, given in this blog.

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Rituja Amolic

She is a seasoned writer and has more than two years of experience in writing blogs, articles, and business news. She has in-depth knowledge of employer of record (EOR) and professional employer organization (PEO) services in India. Her expertise lies in writing blogs related to remote work, subsidiary formation, and freelancing. She is a content writing specialist at Remunance.

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