How German Companies Can Hire Employees in India
German companies can hire employees in India without an Indian entity by using an Employer of Record (EOR). The EOR becomes the legal employer under Indian law. It signs the employment contract, runs payroll and files Provident Fund, ESIC, income tax and Professional Tax, while the German team directs the daily work. An Indian hire can start in 2 to 3 days once the documents are in. The fee starts from $49 per employee per month.
Most German managers expect German terms: long statutory notice periods, works council involvement and strict dismissal rules. However, staff employed in India through an EOR are covered by Indian law and an Indian contract instead. The gaps below are what to plan for.
How German Companies Hire in India Without an Entity
Employer of Record in India already holds the Indian entity and the registrations that come with it. The company selects the candidate and signs a service agreement with the EOR. The EOR then handles the rest:
- The company decides the role, pay and start date, and signs the EOR service agreement.
- The EOR issues the Indian offer letter and employment contract.
- The candidate submits identity, bank and tax documents.
- The EOR registers the employee for PF and ESIC where they apply.
- The first payroll runs and the employee starts work under the company’s direction.
This route suits a mid sized company that wants a first team of engineers, analysts or finance staff without forming an Indian company first. Why German firms look to India is covered in our piece on the skilled worker shortage in Germany.
EOR or Own Indian Subsidiary
| Point | Employer of Record | Own Indian subsidiary |
| Legal employer | The EOR | The German company’s Indian subsidiary |
| Time to first hire | 2 to 3 days once the documents are in | Several months, after incorporation, tax registration and a bank account |
| Directors | None needed | A private limited company needs at least two directors, and at least one must be resident in India |
| Compliance owner | The EOR | The German company |
| Best for | First hires and market tests | Large permanent teams |
Many companies start with an EOR. Then they move staff to a subsidiary once headcount justifies it. The full comparison is in EOR vs setting up a subsidiary in India.
What Differs From German Practice
| German habit | How India differs |
| Statutory notice grows with service. For the employer it runs from four weeks up to seven months after 20 years of service (BGB section 622) | In India notice comes from the employment contract and is commonly 30 to 90 days, followed by a documented exit process. See termination, severance pay and notice period rules in India. |
| Works council rights | Works council rights under German law do not extend to employees employed in India under an Indian contract. |
| GDPR for employee data | A German company still follows the GDPR for the data it holds. India’s Digital Personal Data Protection Act also applies to data of employees in India, so the contract should cover both. See EOR and employee data privacy under the DPDP Act. |
Time Zones and Working Hours
India Standard Time is UTC+5:30 and does not change with the seasons. Germany is on UTC+1 in winter and UTC+2 in summer. India is therefore 4.5 hours ahead in winter and 3.5 hours ahead in summer.
For example, if Indian staff work 10:00 to 18:00 and the German team works 09:00 to 17:00, the two teams share about 4.5 hours of the day in winter and 5.5 hours in summer. That is enough for daily stand ups and live reviews without special shift patterns.
Statutory Costs a German Employer Should Budget
The EOR fee is only part of the cost of an Indian employee. Employers also pay statutory contributions, which vary with salary:
- Provident Fund. The employer contributes 12% of PF wages. The wage ceiling is ₹25,000 a month from 17 September 2026 (SCC Online).
- ESIC. It applies to employees earning up to ₹21,000 a month, with an employer contribution of 3.25% of wages.
- Overall. Employer statutory cost is roughly 4% to 12% of gross pay, depending on the salary.
The full list is in statutory benefits in India. Fee structures are compared in EOR pricing in India.
When an EOR Is Not the Right Fit for a German Company
A large, permanent India team usually costs less through its own subsidiary over time. A PEO becomes an option only after the company owns a registered Indian entity (see PEO services in India). Contractors are a separate route with their own classification risk, covered in hiring contractors in India.
Frequently Asked Questions About Hiring in India From Germany
Can a German company hire employees in India without an Indian entity?
Yes. An Employer of Record becomes the legal employer in India, so the German company needs no Indian entity, registrations or bank account of its own for those staff.
How fast can an EOR start an employee in India?
An Indian hire can start in 2 to 3 days once the contract is signed and the documents are in. A foreign national who needs a visa takes roughly 2 to 3 months, depending on the country.
Does German employment law apply to staff employed in India?
No. Staff hired through an EOR are employed under Indian law on an Indian contract. German rules such as the statutory notice periods in BGB section 622 do not apply to them.
How does notice differ between Germany and India?
German statutory notice for the employer runs from four weeks up to seven months, depending on length of service. In India notice comes from the contract and is commonly 30 to 90 days.
What is the time difference between Germany and India?
India is 4.5 hours ahead of Germany in winter and 3.5 hours ahead in summer, because India does not change its clocks.
What does an EOR cost for a German company hiring in India?
The EOR fee starts from $49 per employee per month. Salary, employer statutory contributions and any benefits are paid on top.