Hiring in India

Indian companies are hierarchical and decision making is top-down. Negotiations can be very slow, especially if a relationship has not already been established. While Indians appreciate data and statistics, they also use their intuition and faith, and they value patience. Indians tend to have an indirect communication style. They try not to say “no,” so you need to watch for euphemisms such as “perhaps” or “possibly.” When trying to establish a rapport, feel free to talk about the latest news or cricket, but avoid personal subjects.

Salary inflation in India is enormous. Employees expect a title increase and a wage increase of 10-15% per year. If the increase is not given each year, the employee is likely to start looking for other jobs. Technology sectors have an exceptionally high rate of job-hopping.

Employees negotiate very hard for good job titles. There is a saying in India which is, “the better the title, the better the wife.” The job title is key especially for young people that haven’t yet married, because it is a matter of great prestige. Many marriages in India are still arranged and an employee’s job title impacts his or her entire life; many candidates will turn down high-paying jobs if the title isn’t sufficient. That said, we would also suggest being careful about “giving away” too much in the title. If you make an employee in India a director, it will connote great respect but then he/she might demand an assistant and not do anything ‘beneath’ his or her job title. Very delicate!

Providing a great workplace culture is very important to Indian employees, as it is not customary to work from home, although this is changing, especially due to traffic in large cities like Bangalore, Mumbai and Delhi. It’s ideal to find your candidate before finding an office space, lest your employee end up commuting two hours in traffic each way to work each day.

When negotiating terms of an employment contract and offer letter with an employee in India, it may be useful to keep the following in mind:
Employment Contracts in India

Indian labor law is complex. As part of our best practice, we suggest putting a strong employment contract in place in India which spells out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in India should always state the salary and any compensation amounts in Indian rupees rather than a foreign currency such as USD. The employment contract template is part of the service with; no need to draft a separate template if you use our employer of record and PEO service in India.