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If you read one article about Indian labour laws, read this one

if you read one article about indian labour laws read this one

If you read one article about Indian labour laws, read this one

When someone mentions labour laws and India, many people begin to think of child labour and other such scandals. Sorry to disappoint, but this is not one of those articles. This post is for individuals and companies from the UK and other countries that are looking for insight into labour laws regarding business formation setup in India. The reasons for setting up business in India are plenty; ranging from lower cost of doing business to increased efficiency and productivity; once you have decided on market entry into India you will then need to consider other aspects such as labour laws.

In order to conduct business in a sanctioned manner in India, a foreign investor should have a comprehensive understanding of Indian labour laws.  It is also advisable for a foreign company to partner with a reputable Indian company to take advantage of their established networks and capabilities.

The partnership does not have to be one that requires company restructuring, but rather a company relationship such as Build-Operate-Transfer (BOT), Offshore Development Centres or Tactical Outsourcing. These models provide the benefits of ease of entering a new country for business and access to knowledge of local laws and guidelines, while still maintaining company structure integrity.

India does not have a national minimum wage however, there is a minimum wage per day for different states, sector’s and positions. Due to such a wide array of variations in wage standards it is recommended to seek advice from a professional.

The following is a list of fundamental Indian labour laws and regulations that you will need to have knowledge of to run a business from there:

  • Factories Act 1948
  • Shops and Commercial Act
  • Industrial Employment Act 1946
  • Contract Labour Act 1970
  • Maternity Benefit Act 1961
  • Sexual Harassment of Women at Workplace Act 2013
  • Minimum Wages Act 1948
  • Payment of Wages Act 1936
  • Equal Remuneration Act 1976
  • Payment of Bonus Act 1965
  • The Payment of Gratuity Act 1972
  • Child Labour Act 1986
  • Employees State Insurance Act 1948
  • The Apprentice Act 1961
  • Employment Exchanges Act 1959
  • Employees Provident Funds and Miscellaneous Provisions Act 1952
  • Industrial Disputes Act 1947
  • Trade Unions Act 1926


This is of course a very comprehensive list and all acts and legislation may not relate to your company’s operations however, it is beneficial to at least be aware of the legislation if the occasion arises. For a more in depth view of Indian labour laws please refer to the Ministry of Labour and Employment website.

If you have further questions about setting up a company in India or other investment opportunities in India, please call us on +44 845 838 2672 or email on

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