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Hiring your first employee in India — the legal stack

Offer letter, PF, ESIC, gratuity, POSH and the contract clauses that protect both sides.

Karthik Subramanian
Karthik Subramanian
Corporate Lawyer
December 12, 20258 min read
Hiring your first employee in India — the legal stack

What you actually need on day one

  • Offer letter + employment agreement.
  • PAN, Aadhaar, bank, education proofs of the employee.
  • Shops & Establishment registration in your state.
  • POSH policy if you have ≥10 employees.

Statutory contributions

  • PF: mandatory above 20 employees (or 10 in some states).
  • ESIC: mandatory for employees earning ≤₹21,000/month if you have ≥10 employees.
  • Gratuity: payable after 5 years of continuous service.
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Karthik Subramanian
Written by
Karthik Subramanian
Corporate Lawyer

Karthik writes for IVEC Insights on practical legal, tax and compliance matters for founders building businesses in India.