Understanding HR policies in India

Having good HR practices and policies is essential to any successful business.

However, when opening a business in a new country, it is even more critical to ensure that your company operates within the political and cultural HR norms. Not doing so risks alienating potential talent in the labour market and creating potential legal problems.

India is fascinating as an example of understanding HR policies and labour laws, as there are federal, state, and industry-specific rules which govern HR regulations. This can make the process of drawing up HR policies complicated for those not familiar with India’s complicated employment laws.

If you are setting up a business in India or perhaps want to improve a business that already operates in India, then continue reading for the top areas to consider relating to staff management in India.

1. Contracts

Although written contracts are not required by law, it is better to have written contracts with local employees to avoid any misunderstandings or potential liability risks. HR departments must understand that state and federal government laws have to be adhered to, in addition to industry-specific rules. This can create confusion, so hiring those who are already familiar with local laws will give you a significant advantage.

2. Wages

Although remaining competitive with the local labour market is essential, it is even more critical to make sure that minimum wage laws are met for all workers at all times. Not knowing the rules and regulations of India is not an excuse for not acting under the law, and you could be subject to harsh fines and penalties if found to be in breach of the minimum wage laws.

3. Maternity/paternity leave

The Maternity Benefits (Amendment) Act, 2017 applies to all businesses hiring more than ten workers. Under this legislation, all businesses must give up to 26 weeks of paid leave for women having their first two children. Although paternity laws are not yet established, they are being discussed in the Indian Parliament, and many companies have pre-emptively adopted paternity policies or offered a shared paternity/maternity leave, i.e., both parents may share the same leave, perhaps taking it in turns to work. Companies that offer paternity leave are generally considered better for employees, making those companies more competitive than their counterparts by attracting more talent.

4. Sexual harassment

The safety of women in India has been the subject of much dialogue due to the high numbers of women subject to rape, assault and abuse throughout the country. Preventing this kind of abuse in the workplace is imperative in any business. Still, as women’s safety has not always been prioritised, it is even more important to ensure that the workplace is a safe space for women to succeed.

According to the Sexual Harassment of Women at Workplace Act, 2013, all complaints about sexual harassment in the workplace should be treated seriously. Complaints need to be actioned and evidenced as soon as possible. Harassment should be redressed immediately, as is appropriate, e.g. termination of the harasser’s contract. In order to prevent sexual harassment in the workplace, HR ought to organise workshops and training events to educate employees.

If your business is looking to expand its global footprint, contact the team at Seamless today.

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