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Written Agreements

Employees can be hired through express (written or oral) or implied contracts. Contracts for fixed-term must be made in writing.

Employers should be vigilant for provisions requiring written contracts in collective agreements or state-level laws.

Oral Agreements

Under the Contract Act, oral contracts are allowed in India and are binding between the parties. However, since oral agreements are difficult to uphold in court, a written contract is the best option for any employment relationship.

According to the Industrial Relations Code 2020, written contracts are not mandatory for hiring permanent or casual employees, however, fixed-term employees must be hired on a written contract. Oral contracts, like written contracts, can be revoked with sufficient notice to the employee.

Implied Agreements

Industrial Relations Code 2020 recognizes implied employment contracts. Certain terms are implied in every contract, such as the entitlement of the employee to recover wages owed from the employer. The Contract Act protects implied promises as long as the implications are rightfully part of the job. Terms that are generally implied in the employment relationship include an employee's duty of fidelity, confidentiality, and protection of the employer's property.

According to the Occupational Safety, Health and Working Conditions Act 2020 of India, no employee can be required or allowed to work in any establishment for more than eight hours a day and six days a week. Children under 18 cannot be employed for more than 6 hours a day and no more than three hours without a break.

The periods of hours of work for all categories of workers must be exhibited on the notice board of the industrial establishment. The Factories Act stipulates that no adult shall be allowed to work in a factory for more than 48 hours in any week and not more than nine hours in any day.

If an employer is involved in a commercial activity, the regional shops and establishments statutes provide the applicable regulations. Generally, they include a maximum of 9 hours per day and 48 hours per week.

India strikes a balance between national holidays, observed in all states and union territories, and gazetted holidays, which the nation's tremendously diverse states may or may not grant their residents.

National holidays are celebrated nationwide, and businesses and government offices shut down.

National holidays:

• Republic Day - January 26
• Independence Day - August 15
• Gandhi Jayanti - October 2

Nationwide gazetted holidays:

• Republic Day
• Independence Day
• Gandhi Jayanti
• Mahavir Jayanti
• Buddha Purnima
• Christmas Day
• Dussehra
• Diwali (Deepavali)
• Good Friday
• Guru Nanak's Birthday
• Eid ul-Fitr
• Eid al-Adha (Bakri id)
• Muharram
• Prophet Mohammad's Birthday (Id-e-Milad)

In addition to the holidays listed above, individual state and union territory holidays exist.

India has provisions for 6 months' probationary period for hiring permanent employees. This period can be further extended by up to 3 months. If a permanent employee is employed as a probationer in a new post, they can be reverted to their old permanent post at any time during the probationary period of 6 months. An employment contract can be terminated without notice in probation.

Notice Period

Employees who have worked for at least 1 year must be given written notice to terminate their contracts. The duration of the notice period depends on the number of employees in the establishment and the reason for termination:

• Establishments with at least 50 employees - 1 month
• Closure of establishment with at least 50 employees - 60 days
• Establishments with at least 300 employees - 3 months

Severance Benefits

Employees who have worked for at least 1 year are entitled to severance pay equal to 15 days' wages for each year of work or any part exceeding 6 months when their employers dismiss them with valid reason. No compensation is paid to employees who refuse to accept any alternative employment offered by their employers or are dismissed due to disciplinary action. Employees dismissed due to transfer or closure of establishment due to unavoidable reasons are also entitled to severance pay, provided their severance pay does not exceed 3 months' wages.

Employees who leave a job after having rendered 5 continuous years of service are entitled to gratuity payment at 15 days' pay for each completed year of continuous service or any part exceeding 6 months. There is a ceiling of INR 2,000,000 (Indian rupees) when calculating severance payments.

Minimum Wage

Under the Code on Wages, 2019, states and territories of India have the authority to establish their own minimum wage rates, as the national floor-level minimum wage is only an advisory recommendation. Because of this structure, different jurisdictions' minimum wage rates vary considerably.

Some states and territories update minimum wage rates twice a year, with the changes generally taking effect April 1 and October 1; however, basic rates are not always updated on these dates, and the frequency with which jurisdictions update their minimum rates varies. Depending on the jurisdiction, rates are updated:

• once a year with effective dates on January 1 or July 1
• twice a year on January 1 and July 1
• with an effective date other than those listed above
• less frequently than on an annual basis

The updates to the minimum wage rates, sometimes called "dearness allowances," are typically calculated to account for inflation and cost of living increases.

Overtime, Holiday & Vacation Pay

The Occupational Safety, Health and Working Conditions Code 2020 and Code on Wages 2019 of India mandate that employees who work beyond the standard working hours in their industries in a day are entitled to overtime compensation at double their typical wages for any hour or part of an hour of overtime worked. Employees can only be required to perform overtime with their consent. Employers must pay overtime if an employee surpasses 48 hours in a week, even if he or she does not work more than 9 hours in a day.

Employees working on their rest days or public holidays are entitled to twice their wages for the day.

Annual leave is paid at the normal wage rate of employees.

Visas

Visas are required of all foreign nationals seeking to enter India. Types of visas include:

• Transit visa - granted for the purpose of traveling through India to another destination, valid for 2 entries into India in the course of the same journey and allows staying up to 3 days.
• Tourist visa - granted for the purpose of tourism, can be multiple entry or single entry, valid for up to 5 years with restrictions on stay up to 90 days without registration. Nationals from US, Canada, UK and Japan can stay up to 180 days.
• Medical visa - granted to foreign nationals to seek medical treatment in specialized hospitals/treatment centers in India, valid for 6 months.
• Employment visa - granted to persons who are employed at an Indian company or traveling to India to volunteer with a Non-Governmental Organization (NGO), valid for 1 year or for the term of the contract.
• Business visa - granted to foreign nationals wish to visit India for business purposes, valid for 10 years with multiple entry, provided continuous stay during each visit does not exceed 180 days.
• Student and research visa - granted to foreign nationals to pursue on-campus, full-time (structured) courses at educational institutions duly recognized by the statutory regulatory body, valid for a maximum of 5 years with 4 entries per academic year.
• Intern visa - granted to a foreigner intending to pursue an internship in Indian companies, educational institutions and NGOs for a maximum of 1 year.
• Entry ('X") visa - granted to Persons of Indian Origin who do not possess an OCI card, or spouse and children of an Indian citizen/ Person of Indian Origin/ OCI cardholder or foreigners coming to join missionaries or monasteries. It is valid for a maximum of 5 years.
• Conference visa - granted to a foreigner whose sole objective of visiting India is to attend a conference/seminar or workshop being held in India.
• Sports visa - granted to members of foreign sports teams to visit India for sports events.
• Journalist visa - granted to foreign journalist, photographer, documentary film producer or director for a maximum of 3 months.
• Missionary visa - granted to a foreigner whose sole objective of visiting India is missionary work, granted for a maximum of 1 year with multiple entries.
• e-Visa - issued for tourism, medical treatment or short-term business purposes, valid for a period up to 60 days with double entry on e-Tourist Visa and eBusiness Visa and triple entry on e-Medical Visa.

Work Permits

India issues Employment or E visa for one year or the term of the contract in India (up to five years) to highly skilled and/or qualified foreign nationals who wish to work in India. E visa can only be issued to an employee of an organization registered in India. Foreigners traveling to India to do volunteer work with a Non-Governmental Organization will also need an E visa. E visa is also required for self-employed individuals, consultants, foreign artists conducting regular performances, specialists, etc.

The foreign national being sponsored for an E Visa in any sector must have an annual salary above INR 1,625,000. However, this condition does not apply to ethnic cooks, language teachers or translators and staff working for an embassy in India.