EOR Cost in India 2027: Fees, Employer Costs and Worked Examples
Short answer: In 2027, employing one person in India through an Employer of Record (EOR) costs the gross salary, plus about Rs 3,275 a month in employer PF and related charges, plus the EOR fee. Published EOR fees for India run from about $99 to $599 per employee per month among the providers we checked; TMS starts at $100 and falls to $50 as your team grows. For an employee on Rs 12 lakh a year, that is about $1,190 a month all in with TMS.
What does an EOR in India cost you?
An EOR becomes the legal employer of your staff in India. It issues the employment contract, runs payroll, deducts tax, pays PF and other statutory dues, and files the returns. You choose the person and direct their work. The total cost has three parts:
- Gross salary. What you agree with the employee, before their own tax and PF deductions.
- Employer statutory cost. Contributions the law makes the employer pay on top of salary: PF, EDLI, PF admin charges, ESIC where it applies, Labour Welfare Fund, and gratuity when it falls due.
- The EOR fee. A monthly charge per employee for being the employer of record and doing the compliance work.
Most price comparisons only show the third part. The first two are the same whichever provider you pick, but you still need them for your budget.
How much do EOR providers charge in India?
These are published starting prices for India, checked on each provider’s own pricing page in October 2026.
| Provider type | Published starting fee (per employee per month) |
|---|---|
| India specialists (TMS, Wisemonk) | TMS from $50 (tiered, $100 for the first five); Wisemonk from $99 |
| India-first with other countries (Gloroots) | $199 |
| Global platforms (Multiplier, Papaya Global, Deel, Remote) | From $459 (Multiplier, billed annually) to $599 (Deel, Remote) |
Some providers quote the fee as a percentage of salary instead of a flat amount. A percentage fee grows every time you give a raise, even though the compliance work stays the same. For a full comparison of ten providers, see Best EOR providers in India for 2027.
What does one employee cost in 2027? Four worked examples
The table shows the full monthly cost at four common salary levels. Wages (basic pay plus dearness allowance) are set at 50% of gross, the minimum the Code on Wages allows. The TMS fee is $100 a month, the rate for your first five employees, converted at an indicative Rs 95 to the dollar.
| Annual gross salary | Rs 6 lakh | Rs 12 lakh | Rs 24 lakh | Rs 40 lakh |
|---|---|---|---|---|
| Monthly gross | Rs 50,000 | Rs 1,00,000 | Rs 2,00,000 | Rs 3,33,333 |
| Employer PF (12% of wages up to Rs 25,000) | Rs 3,000 | Rs 3,000 | Rs 3,000 | Rs 3,000 |
| EDLI 0.5% + PF admin 0.5% (on Rs 25,000) | Rs 250 | Rs 250 | Rs 250 | Rs 250 |
| ESIC | Not applicable | Not applicable | Not applicable | Not applicable |
| Labour Welfare Fund (varies by state) | About Rs 25 | About Rs 25 | About Rs 25 | About Rs 25 |
| TMS EOR fee ($100) | Rs 9,500 | Rs 9,500 | Rs 9,500 | Rs 9,500 |
| Total per month | Rs 62,775 (about $661) | Rs 1,12,775 (about $1,187) | Rs 2,12,775 (about $2,240) | Rs 3,46,108 (about $3,643) |
| Gratuity to budget for (4.81% of wages) | Rs 1,203 | Rs 2,405 | Rs 4,810 | Rs 8,017 |
Illustrative only. Structures vary by role and state. Group health insurance, if you offer it, is extra: plan for about Rs 800 to Rs 1,000 a month per employee. Exchange rates change; TMS quotes in USD, EUR or AED.
Three things stand out:
- Employer PF is capped. The law requires employer PF on wages up to Rs 25,000 a month, so the mandatory amount stops at Rs 3,000. Many employers choose to contribute on full wages. If you do, add 12% of wages above Rs 25,000: Rs 3,000 more a month at Rs 12 lakh, and Rs 17,000 more at Rs 40 lakh.
- ESIC does not apply at these salaries. It covers employees earning up to Rs 21,000 a month. If you hire below that level, the employer pays 3.25% of wages on top.
- Gratuity is a liability, not a monthly bill. It is payable when an employee leaves after five years, or when a fixed-term contract ends. TMS does not charge it monthly; it is billed only if and when it becomes payable. Some providers add it to every invoice, which raises the monthly cost by about 2.4% at these salaries.
To run the numbers for your own salary and state, use the India EOR cost calculator.
Why the fee matters more for smaller salaries
The compliance work behind one employee is about the same at Rs 6 lakh as at Rs 40 lakh. A flat fee therefore takes a bigger share of a smaller salary. Here is the same Rs 12 lakh employee with different fees:
| EOR fee per month | Fee as a share of gross salary | Total monthly cost |
|---|---|---|
| $100 (TMS, first five employees) | 9.5% | About $1,187 |
| $199 | 18.9% | About $1,286 |
| $599 | 56.9% | About $1,686 |
Over a year, the gap between a $100 fee and a $599 fee is about $6,000 for one person, close to the full annual salary of a Rs 6 lakh employee.
How does TMS price EOR for a team?
TMS charges a flat fee per employee, set by team size. The rates stack, like tax slabs: your first five employees are always billed at the first rate.
| Employees | TMS fee per employee per month |
|---|---|
| 1 to 5 | $100 |
| 6 to 10 | $75 |
| 11 to 25 | $65 |
| 26 and above | $50 |
Example: a team of 10 costs 5 x $100 plus 5 x $75, which is $875 a month in fees. A team of 20 costs $1,525. There is no setup fee, no deposit, no FX margin and no exit fee. The full rate card and what it includes is on our EOR pricing page.
What changes the cost of employing in India in 2027?
2027 is the first full year under India’s Labour Codes. Four changes feed straight into employer cost:
- PF wage ceiling is Rs 25,000 a month. It rose from Rs 15,000 on 17 September 2026 (S.O. 5109(E)), and applies to EPF, EPS and EDLI. Mandatory employer PF went from Rs 1,800 to Rs 3,000 a month for most salaried staff.
- Wages must be at least half of pay. Under section 2(y) of the Code on Wages, allowances above 50% of total pay count as wages. This sets the base for PF and gratuity.
- Fixed-term staff get gratuity without the five-year rule. Section 53 of the Code on Social Security gives fixed-term employees gratuity when the contract ends.
- ESIC limit stays at Rs 21,000 a month. Employees earning Rs 21,001 to Rs 25,000 now pay PF but not ESIC.
For every filing date in the year, see the HR compliance calendar 2027.
Which costs are not in the headline fee?
- Setup or onboarding fees. One-time charges per employee.
- Security deposits. Some providers hold a deposit for the whole contract.
- FX margin. A mark-up on the exchange rate when you pay in dollars or euros.
- Gratuity billed monthly. Adds about 2.4% of salary to each invoice.
- Exit and transfer fees. Charged when an employee leaves or moves to your own entity.
Ask for a written quote that shows every one of these, for your actual salaries.
Is an EOR cheaper than setting up your own entity?
For a small team, usually yes. Your own private limited company in India means registration, a registered office, a resident director, statutory audit, monthly payroll and tax filings, and state labour registrations, before you hire anyone. An EOR lets you hire within days and pay only per employee. Once your India team is large and settled, your own entity can cost less per head; many companies start with an EOR and move staff across later. See EOR in India for how the transfer works.
Budgeting for India in 2027? Get a written TMS cost sheet for your roles, with every line shown, within one business day.
Frequently asked questions
How much does an EOR cost in India in 2027?
The EOR fee runs from about $99 to $599 per employee per month among the providers we checked, with TMS from $50 on a tiered scale. On top, you pay the gross salary and about Rs 3,275 a month in employer PF and related charges for most salaried staff.
Is employer PF included in the salary or on top?
It depends on how the offer is written. If you agree a gross salary, employer PF is paid on top. If you agree a cost to company (CTC), employer PF sits inside it. Agree which one you mean before the offer goes out.
Do I pay ESIC for employees in India?
Only for employees earning up to Rs 21,000 a month (Rs 25,000 for employees with a disability). The employer pays 3.25% of wages and the employee 0.75%.
Does an EOR charge gratuity every month?
Some do. TMS does not; gratuity is billed only if and when it becomes payable, for example when a fixed-term contract ends or an employee leaves after five years.
What is the cheapest way to hire one employee in India?
For one or a few employees, an India-focused EOR is usually cheapest, because you avoid the cost of setting up and running your own entity. Check the all-in monthly cost, not just the fee.
Sources: Gazette notification S.O. 5109(E) dated 17 September 2026 and EPFO FAQs on the revised wage ceiling (epfindia.gov.in); Code on Wages, 2019, section 2(y); Code on Social Security, 2020, section 53; Gazette notifications S.O. 5322(E) and S.O. 5319(E) dated 21 November 2025; ESIC coverage page (esic.gov.in). Provider fees from each provider’s own pricing page, October 2026. Checked 29 October 2026.