India flag India: Operating a Business in India

Work conditions in India

The Active Population in Figures

201820192020
Labour Force -586,110,788-579,009,121-602,052,834

Source: International Labour Organization, ILOSTAT database

 
201720182019
Total activity rate 52.52%52.15%52.13%
Men activity rate 80.15%79.70%79.57%
Women activity rate 22.45%22.16%22.26%

Source: International Labour Organization, ILOSTAT database

 

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Working Conditions

Legal Weekly Duration
Maximum 48 hours (9 hours a day).
Retirement Age
It varies from 58 to 65 years. Early retirement schemes called Voluntary Retirement Scheme (VRS) also exist in the country.
Working Contracts
1. Permanent (more than 90%)
2. Temporary
3. Fixed-term
Labour Laws
Consult Doing Business Website, to obtain a summary of the labor regulations that apply to local entreprises.

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Cost of Labour

Minimum Wage
The minimum wage fluctuates a lot between states, sectors and skill levels and is regulary revised. In April 2022, the minimum wage for unskilled agricultural worker was set at 382 Indian rupees for an eight-hour work day.
Average Wage
The average wage fluctuates a lot depending on activity sectors and States. According to a study by Salary Explorer, the average monthly salary was INR 31,900 in 2021.
Social Contributions
Social Security Contributions Paid By Employers: The Employees' Provident Fund (EPF) Scheme is funded by the employer at 3.67% of monthly salaries (plus 0.5% of monthly salaries for administrative costs). 8.33% of the salary is compulsorily contributed to the pension scheme. If the monthly salary of employees exceeds INR 15,000, this contribution is allocated to the pension fund. Finally, the employer must contribute to Employer Liability with an average of 4% of the monthly payroll.
Social Security Contributions Paid By Employees: The Employees' Provident Fund (EPF) Scheme is 12% contributed by the employee, the Employee Pension Scheme (EPS) is not contributed to by the employee. 

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Social Partners

Social Dialogue and Involvement of Social Partners
With some exceptions, India has company unions rather than trade unions. These are often affiliated with national labor organizations. Political parties promote various trade unions. The bargaining power of the unions is declining as the government pushes forward its reform agenda.
Unions

Unionisation Rate
Although there are more than 20 million unionized workers, unions represent less than 25% of the workers in the organized sector (primarily in state-owned organizations), and less than 5% percent of the total work force.
Labour Regulation Bodies
Ministry of Labor and Employment

Labor Bureau


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Latest Update: September 2022