An Overview of the Local Labour Laws and Requirements When Working in India

Summary of Employment Laws in India The employment laws in India are applicable to both locals and foreigners who live in work in the country. What an employee is entitled to will depend on the category of employment.

The labour law is also referred to as the employment law. It is a separate branch that is enacted to protect the rights of workers in the country. The statutory rights and entitlement of an employee will be based on what category of employment they fall into. Rights and entitlements include:

  • Remuneration
  • Location of employment
  • Industry type

If an Indian national is working abroad, the laws of employment in India will not apply to them.


The Available Employee Categories

India’s legislation recognises three groups of employees. They are the:

  • Employee
  • Workmen
  • Non-workmen


The Laws Enacted for Specific Purposes

Several laws in India have been enacted for a specific purpose. These laws are:

  • Workmen’s Compensation Act, 1923
  • The Employees’ Provident Fund Scheme, 1952.
  • The Child Labour (Prohibition & Regulation) Act, 1986
  • The Factories Act, 1948
  • The Payment of Gratuity Act, 1972
  • The Payment of Wages Act, 1936
  • Industrial employment (standing orders) Act, 1946)
  • Maternity Benefit Act,1961
  • The Trade Union Act, 1926
  • The Industrial Disputes Act, 1947
  • The Employee State Insurance Act, [ESI] 1948
  • The Payment of Bonus Act, 1965
  • The Contract Labour (Regulation and Abolition) Act, 1970
  • Lockouts (Industry)
  • Lay Offs / Laid off and Retrenchment
  • Labour Courts for disputes in India


The Laws That Regulate Employment Relationships

In India, there are several laws that regulate the employment relationship of an employee. Those laws apply to both locals and foreigners, and they are:

  • Employees’ Provident Fund
  • Miscellaneous Provisions Act 1952 (EPF Act)
  • Employees’ State Insurance Act 1948 (ESI Act)
  • Industrial Disputes Act 1947 (ID Act)
  • Maternity Benefit Act 1961 (MBA)
  • Payment of Bonus Act 1965 (PBA)

Before coming to work in India, a foreign employee must have the appropriate work visa to commence. This can be applied with the Indian Embassy/High Commission in the employee’s country of residence.

If the foreign employee is staying more than 180 days, they must obtain a Foreigners Regional Registration Offices (FRRO) or the Foreigners Registration Offices (FRO). This must be done within 14 days of arrival. The foreigner must also have a valid travel document and a re-entry permit.


No Discrimination Policy

Under the Constitution of India from 1950, articles 14-16, 19(1)(c), 23-24, 38, and 41-43A, all employees in India should be treated equally. No discrimination against employees should be tolerated.


Conducting Background Checks

In India, there are no specific prohibitions or restrictions for conducting background checks. The checks can only be done once obtaining the consent of the employee. Employment laws in India allow an employer to request more information about criminal records and health checks, for example.

If an employer wants to retain and store information about the employee, it must comply with the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data and Information) Rules 2011 (Sensitive Information Rules).

Summary of Employment Laws in India