EU companies can hire employees in India without an entity by using an Employer of Record, which handles payroll, PF, ESIC. Full compliance. However. The EU-India trade partnership deepening, more European firms want to hire employees in India quickly and compliantly. Fortunately, you do not need an Indian company to do it. This 2026 guide explains how EU employers can build an India team in days, not months.
Last updated: 19 August 2026.
Can EU Companies Hire Employees in India Without an Entity?
Yes. In fact, EU companies can hire employees in India without setting up a local entity by using an Employer of Record (EOR). Specifically, the EOR is a compliant Indian company that employs your team on paper. Your managers direct the daily work. You skip months of incorporation and start almost immediately.
How to Hire Employees in India: Five Steps
The process is simple and fast when you use a partner. Follow these five steps:
- Define the role. For example, share the job, location, salary, and start date.
- Sign an agreement. Then the EOR provides a service agreement and a compliant India employment contract.
- Onboard the employee. Meanwhile, background checks and statutory registrations run in parallel.
- Run payroll. Consequently, each month, the EOR files PF, ESIC, Professional Tax, and TDS.
- Manage the work. Your team reports to you, while the EOR holds the paperwork.
EOR vs Your Own Entity
The right structure depends on scale. In short, an EOR suits fast entry and testing, while an entity suits large, permanent operations.
| Factor | EOR | Own entity |
|---|---|---|
| Indian entity needed | No | Yes |
| Time to first hire | 24 to 48 hours | 2 to 4 months |
| Compliance handled by | The EOR | You |
| Best for | Fast entry and test hires | Large permanent teams |
Costs and Compliance When You Hire in India
To begin with, Indian employment carries statutory costs beyond salary, such as Provident Fund and ESIC. The four Labour Codes now require basic pay to be at least 50 percent of total salary. Therefore an experienced partner keeps your statutory compliance accurate for every state. In particular, for the wider context, read why the EU-India FTA is pointing European companies toward India.
Build Your India Team with TMS
Hiring and paying staff in India is simplest with one accountable partner. Therefore, TMS covers the full lifecycle:
- Employer of Record (EOR) — hire and pay staff in India with no entity setup.
- Payroll outsourcing — salaries, PF, ESIC, and TDS handled accurately.
- Statutory compliance — labour-law compliance under the Codes now in force.
- Contract staffing — flex your India headcount as needed.
Frequently Asked Questions
How fast can an EU company hire employees in India?
Besides, with an Employer of Record, onboarding usually takes 24 to 48 hours from a signed agreement. This is because statutory steps run in parallel.
Is it legal to hire in India through an EOR?
Yes. The EOR must hold its own PF, ESIC, and other registrations. It discharges every statutory obligation on your behalf.
Can we move employees to our own entity later?
Yes. Once you incorporate in India, staff transfer with continuity of service, so there is no lock-in.
Start Hiring in India Today
Ready to hire employees in India? Furthermore, TMS is the legal Employer of Record for staff across all 28 Indian states and serves clients from more than 20 countries. Talk to our team to go live in 24 to 48 hours.
Related services
- India Business Expansion — entity, banking, tax and day-one hiring.
- HR Consulting & Advisory — policies, employment letters and labour-law guidance.