What should an employment contract in India include?
An employment contract in India should include the following information:
- Both the names and contact details of the employer and employee.
- The employee’s job title and responsibilities.
- The employee’s working hours and days.
- The agreed salary, supplementary benefits, and potential bonuses.
- Termination clauses, including notice periods for both parties.
- Agreement on confidentiality terms.
Before signing, both parties need to review the employment agreement thoroughly.
What types of employment contracts exist in India?
Employment contracts in India can be classified into several categories.
1. Employee contracts
This is the most common employment contract in India. It’s further divided into two groups of contracts:
- Permanent Employment Agreements: The most common form of employment arrangement in India is the permanent employment contract. This contract is given to employees who work standard hours, whether on a full-time or part-time basis. Typically, no specific end date is mentioned when an organization issues a permanent contract. It remains valid until either the organization or the employee decides to terminate it.
- Fixed-Term or Open-Ended Contracts: Fixed-term contracts are often utilized for freelance or independent contractors. These contracts have a designated end date detailing the start and end dates, salary particulars, and the entitlements of independent contractors during their work with the employer.
2. Casual Employment Agreements
A casual employment contract blends the characteristics of both permanent and fixed-term contracts. While it resembles a permanent contract due to fixed working hours, it also shares similarities with fixed-term contracts by specifying a predefined duration (or conclusion date) for employment. For instance, the contract might outline that the employee is expected to work for 48 hours, with the employee largely responsible for determining the actual work hours.
3. Zero-Hour Worker Agreements
A zero-hour work contract refers to an employment arrangement where the employer isn’t obligated to provide a set number of working hours to the employee. This contract type implies the employee is not exclusively bound to work solely for a specific employer.
How to hire employees in India?
When hiring employees in India, it’s generally necessary to form a legal entity within the nation. This involves enrolling your company with Indian authorities and acquiring a business registration ID. Additionally, strict adherence to India’s local laws and regulations is crucial.
However, with the aid of Native Teams’ employer of record services, you can dedicate your attention to your business’s day-to-day operations, leaving the remaining responsibilities to us. We offer comprehensive assistance for lawful recruitment in India and various other countries worldwide.