Hiring in India from Australia

On this page (7 sections)

Overview
Australia and India at a glance
The differences that matter most
Common compliance traps
How an EOR works in India
FAQs
Sources

INRLocal currency

New DelhiCapital

IST (UTC+5:30), 4.5 to 5.5 hours behind SydneyTime difference

Overview and why companies expand from Australia to India

India has one of the world's largest pools of technology, engineering and business services talent.
Australian companies build development, data and operations teams in hubs such as Bengaluru, Hyderabad, Pune and Chennai.
The Australia-India Economic Cooperation and Trade Agreement supports closer trade and investment.
India's time zone allows a useful overlap with Australian afternoons.

India's employment framework was reshaped when the four labour codes came into force on 21 November 2025. They consolidated older laws on wages, industrial relations, social security and working conditions, and widened the definition of wages used for many calculations. Central and state rules are still being finalised, so expect practice to keep evolving.

Australia and India at a glance

Summary only. Figures were checked against the official sources listed below on 2026-10-08. Many rules depend on the employee's award, contract, state or province.
Topic	Australia	India
Employment contracts	A written contract is not legally required but is standard practice. Employers must give every new employee the Fair Work Information Statement, plus the Casual or Fixed Term Contract Information Statement where relevant. A modern award or enterprise agreement usually sets minimum terms. Fixed-term contracts are generally limited to 2 years or 2 consecutive contracts.	The four labour codes came into force on 21 November 2025, replacing 29 central laws, with state rules still being finalised. Employers must issue appointment letters. State Shops and Establishments Acts add local rules.
Probation	No statutory probation. In practice the unfair dismissal "minimum employment period" works as one: 6 months, or 12 months for small businesses with fewer than 15 employees.	Not regulated nationally. Probation of 3 to 6 months is common and is set by contract or standing orders.
Working hours	Maximum 38 ordinary hours a week plus reasonable additional hours under the National Employment Standards. Awards set overtime rates. Employees have a right to disconnect outside working hours unless refusing is unreasonable.	Generally up to 8 hours a day and 48 hours a week, with overtime at twice the ordinary rate. State Shops and Establishments Acts set detailed limits.
Minimum wage	National Minimum Wage of $26.44 an hour ($1,004.90 a week) from 1 July 2026. Most employees are covered by a modern award with higher minimum rates for their classification.	The central government sets a national floor wage and states set minimum wages by region, industry and skill level, so rates vary widely.
Annual leave	4 weeks paid annual leave a year for full-time employees (5 weeks for some shift workers), accruing progressively. Untaken leave is paid out on termination. Many awards add a 17.5% leave loading.	Earned leave depends on the applicable law, commonly 1 day for every 20 days worked once an employee has worked 180 days in a year.
Sick leave	10 days paid personal/carer's leave a year for full-time employees, plus 2 days unpaid carer's leave and 2 days paid compassionate leave per occasion. All employees can also take 10 days paid family and domestic violence leave a year.	Set by state Shops and Establishments Acts, so entitlements vary by state.
Parental leave	Up to 12 months unpaid parental leave after 12 months of service, with the right to request 12 more. The government funds up to 26 weeks of Parental Leave Pay at the national minimum wage from 1 July 2026, paid through Services Australia rather than the employer.	26 weeks paid maternity leave for the first two children, paid by the employer or through ESI for covered employees. No statutory paternity leave for most private sector employees.
Public holidays	National public holidays such as New Year's Day, Australia Day, Good Friday, Easter Monday, Anzac Day, Christmas Day and Boxing Day, plus state and territory holidays. Employees who work on a public holiday are usually paid penalty rates under their award.	3 national holidays (Republic Day, Independence Day and Gandhi Jayanti) plus state and festival holidays, which vary by state.
Retirement and social security	Superannuation Guarantee of 12% of qualifying earnings, paid by the employer on top of wages. Since 1 July 2026 super must be paid each payday and reach the fund within 7 business days (Payday Super). There is no separate employer social security levy.	Employees' Provident Fund contributions of 12% by the employer and 12% by the employee on basic wages, with part of the employer share going to the pension scheme. ESI applies to lower earners.
Payroll taxes	Employers withhold PAYG income tax from wages. Each state and territory charges payroll tax once total Australian wages pass a threshold, for example 5.45% above $1.2 million in NSW and 4.85% above $1 million in Victoria. Workers' compensation premiums are also payable.	Employers deduct income tax at source (TDS) from salaries. Some states levy professional tax and labour welfare fund contributions.
Notice periods	Employer notice under the National Employment Standards: 1 week (up to 1 year of service) rising to 4 weeks (over 5 years), plus 1 week if the employee is over 45 with at least 2 years of service. Pay in lieu is allowed. Awards set employee notice.	Set by contract, commonly 1 to 3 months. Retrenching a worker with at least 1 year of service needs 1 month's notice or pay in lieu.
Dismissal protection	Unfair dismissal protection applies after the minimum employment period to employees covered by an award or agreement, or earning under the high income threshold of $190,100 (from 1 July 2026). General protections against adverse action apply from day one. Small businesses can follow the Small Business Fair Dismissal Code.	Non-managerial "workers" have strong protection under the Industrial Relations Code. Larger establishments need government permission for retrenchments and closures.
Severance	Statutory redundancy pay of 4 weeks (1 to 2 years of service) rising to 16 weeks (9 to 10 years), then 12 weeks at 10 years or more, when long service leave usually takes over. Small businesses with fewer than 15 employees are generally exempt.	Retrenchment compensation of 15 days' average pay per completed year of service for workers. Gratuity of 15 days' wages per year of service is payable after 5 years, or after 1 year for fixed-term employees.
Mandatory benefits	Superannuation, workers' compensation insurance (state-based and compulsory), paid leave under the National Employment Standards and long service leave under state and territory laws, usually after 7 to 10 years of service.	Provident fund, ESI where applicable, gratuity and statutory bonus for eligible employees.
IP and restraint clauses	Post-employment restraints are only enforceable if reasonable to protect a legitimate business interest. Employers generally own IP that employees create in the course of employment. The federal government has proposed banning non-compete clauses for employees under the high income threshold from 2027; this was not law at the last review.	Post-employment non-competes are generally void under section 27 of the Indian Contract Act. Confidentiality and non-solicitation clauses are more likely to be upheld. IP assignments must be in writing.
Visas and right to work	Every worker needs Australian work rights, which employers can check through VEVO. Sponsored skilled hires generally use the Skills in Demand (subclass 482) visa, which needs an approved sponsor. Some EORs can sponsor, many cannot.	Foreign nationals working in India need an Employment Visa, which generally has a minimum salary requirement. The sponsoring entity must be registered in India.

The differences that matter most

Workers and managers

Indian law distinguishes between "workers" (broadly non-managerial staff) and managerial or supervisory employees. Workers have strong statutory protection against retrenchment, while managers rely mainly on their contracts. Australia doesn't draw this distinction in the same way.

Provident fund, ESI and gratuity

Instead of 12% super, Indian employers contribute to the Employees' Provident Fund, may contribute to Employees' State Insurance for lower earners and must pay gratuity to qualifying employees when they leave. Gratuity is a significant long-term liability that Australian companies often overlook.

Wage structures

Indian salaries traditionally include basic pay plus many allowances. The labour codes require that excluded allowances can't exceed a set share of total remuneration, which increases the base for provident fund and gratuity. Review salary structures with the EOR or a local adviser.

Leave and holidays

Leave entitlements come from state Shops and Establishments Acts and the labour codes, and vary by state. Public holidays include three national holidays plus state and festival holidays.

Non-competes don't work

Post-employment non-competes are generally void in India. Protect your business with confidentiality obligations, IP assignment and non-solicitation clauses instead.

Common compliance traps

Missing state registrations under Shops and Establishments Acts.
Using Australian-style contracts that don't reflect Indian leave, notice and wage rules.
Under-provisioning for gratuity, particularly for fixed-term staff who now qualify after 1 year.
Night shift and women's employment rules, which need specific safeguards in some states.
Overreliance on contractors for long-term, full-time roles, which risks misclassification.

How an EOR works in India

An Indian EOR employs your hire through its local entity, registers for provident fund and other schemes, structures pay in line with the labour codes, deducts tax at source and provides payslips and statutory filings. You manage the work. For larger engineering or operations centres, Australian companies often set up an Indian subsidiary, sometimes after starting with an EOR.

Frequently asked questions

What are India's new labour codes?

Four labour codes on wages, industrial relations, social security and occupational safety came into force on 21 November 2025, consolidating 29 older central laws. States are still finalising some rules, so practice is evolving.

What is gratuity?

Gratuity is a statutory lump sum paid when employment ends, generally 15 days' wages for each completed year of service. It usually applies after 5 years of continuous service, but fixed-term employees qualify after 1 year under the new Code on Social Security.

Are non-compete clauses enforceable in India?

Post-employment non-competes are generally void under section 27 of the Indian Contract Act. Confidentiality and reasonable non-solicitation clauses are more likely to be enforced.

How much is provident fund?

Under the Employees' Provident Fund scheme, employers and employees each typically contribute 12% of basic wages, with part of the employer share going to the Employees' Pension Scheme. The labour codes' wider definition of wages can increase the base.

Can an Australian company employ directly in India without an entity?

It is difficult. Employers need local registrations for provident fund, state labour laws and tax deduction. Most foreign companies use an EOR or set up an Indian subsidiary.

Sources

Last reviewed: 2026-10-08

Figures on this page were checked against these official sources on 8 October 2026. Rates and thresholds change, often on 1 January, 1 April or 1 July, so confirm current figures before relying on them.

New to the model? Start with what an Employer of Record is, then compareEOR costs and pricing models.