Guide to hiring employees in Mexico

Everything you need to know when expanding your workforce in Mexico

    Source: Canva


    India is the world’s largest democracy and is an attractive place for business. It is the second-most populous country in the world, and approximately 45% of its population is aged between 20 and 40 years, making it a prime location for employing skilled workers. 

    Recently, India has introduced updated company law and listing regulations to align their requirements with those of other countries. The Indian Government has launched initiatives to prioritise areas such as skills development, tax breaks and relaxation of norms for organisations in some sectors. These changes have benefited business growth significantly in India. 

    The biggest industries in India are:

    • Iron and steel
    • Textiles
    • Jute
    • Sugar
    • Cement
    • Paper
    • Petrochemicals
    • Automobiles
    • IT
    • Banking and insurance 

    The largest sector in India is the service sector, which accounts for 54% of India’s total Gross Value Added (GVA) of 179.15 lakh crore Indian rupees.


    New Delhi

    Languages spoken

    Hindi and English

    Population size

    1.408 billion


    Indian Rupee (INR)


    Between 5% and 28%


    Taxes in Mexico

    Any establishment in India that employs 20 or more people, or any establishment that voluntarily registers with the authorities, is subject to Indian social security regulations. This means that employees working at these establishments (including foreign nationals) are required to contribute towards the provident fund at a rate of 12% of their salary. 

    The employer is also required to make a matching contribution and deposit both the employer’s and employee’s contributions (totaling 24%) to the employee’s provident fund by the fifteenth day of the following month.

    Out of the employer’s contribution, 8.33% of an employee's salary (capped at INR 15,000 per month for Indian employees) is allocated to the employee's pension fund.

    Working hours in Mexico

    The new Labour Codes state that weekly and daily working hours are capped at a maximum of 48 hours and 12 hours respectively. A four-day working week is also optional, with employees working a maximum of 12 hours per day during the shorter week.  

    pexels-thirdman-7993952Source: Pexels/Thirdman

    Minimum wage in Mexico

    India has the most competitive labour costs in Asia, with a national minimum wage of around 178 INR per day (5,340 INR per month). However, this rate varies based on factors such as geographical location. 

    Employee benefits in Mexico

    Mandatory benefits 

    There are several mandatory benefits for employees in India:

    Employee’s Provident Funds
    The Employees' Provident Fund, Employees' Pension Scheme, and Employees' Deposit Linked Insurance are covered by the Employees' Provident Funds and Miscellaneous Provisions Acts. These are funded by employer and employee tax contributions.

    Employee State Insurance Scheme 
    The Employee State Insurance Scheme is mandatory for employees earning up to INR 21,000 per month (or INR 25,000 per month for employees with disabilities). This scheme provides medical coverage for the employee's family, including parents and dependent siblings, disability compensation, widow's and children's pension, and other benefits. 

    The scheme is funded by employer and employee contributions, as well as Government contributions.

    Paid maternity leave
    Employees are entitled to 26 weeks of paid maternity leave. Additionally, the Maternity Benefits (Amendment) Act states that employers with more than 50 employees must provide a creche for children aged up to six years. We will cover maternity leave in more detail later on in this guide. 

    Statutory leave 
    Statutory leaves are regulated by each State’s Shops and Establishments Acts, or by the Factories Act. These cover sick leave, casual leave, privilege/earned leave, national holidays, State Founding Day, and other leaves such as bereavement leave.

    Gratuity payment 
    This is a bonus payment that an employee receives after working for 4 years and 8 months. They get it when they leave the company, or earlier in the case of death or disability. 

    Supplementary benefits

    Supplementary benefits in India often include the following:

    Group medical insurance
    Group medical insurance provides coverage for hospitalisation, with some exceptions. This includes benefits for maternity and newborns, as well as add-on benefits for new types of cancer treatment, cyber-knife or robotic treatment, and fertility treatments. 

    The plan usually extends to cover a spouse or domestic partner, children, parents or in-laws, and sometimes dependent siblings. Most employers fully fund the employee’s spouse and children or sibling coverage, but may require full or partial employee contribution towards parental coverage.

    Typically, the plan covers the following:

    • In-patient hospitalisation for any illness or accident (this excludes treatment and day care procedures)
    • The maternity period
    • Pre-existing illnesses
    • Room rent (subject to a predetermined limit)
    • Dental treatment for injuries requiring hospitalisation
    • Ambulance services
    • 30 days pre- and 60 days post-hospitalisation expenses (for out-patients)
    • Psychiatric treatment (for in-patients)

    Group personal accident insurance
    Most employers in India offer a group personal accident policy that covers things like death, disability, medical expenses, and more. The coverage amount is usually either a fixed amount, a percentage of salary, or a multiple of salary (usually 2x to 3x the employee’s annual salary).

    The Pension system in India has two pillars. The first pillar is the Employees’ Pension Fund. This is paid for by the employer contribution to the Employees’ Provident Fund.

    The second pillar is purely voluntary and consists of superannuation funds. This pillar also includes the National Pension Scheme (NPS), which requires an employer to set up a Tier 1 account under NPS, but does not require trust formation to facilitate employer and employee contributions. 

    An employer can set up either or both pillars.

    Company perks
    Companies in India generally provide other benefits, such as meal, transport and mobile phone allowances. 

    Types of leave available in Mexico

    Annual leave

    Employees who have worked a minimum of 240 days in a year are eligible for 12 days of paid leave per annum. 

    Annual leave dates must be agreed between the employer, works committee and manager to ensure continuity of work. The employer must give at least 15 days of notice for time off requests.

    Sick leave

    Employees in India are entitled to up to 15 days of paid sick leave. They may need to show medical certification as proof before the leave is authorised. 

    Maternity leave

    Pregnant employees in India are entitled to 26 weeks of maternity leave, as long as they have worked for a minimum of 80 days during the year preceding the expected delivery date (excluding holidays). Maternity pay is based on the employee’s average daily wage. 

    Maternity leave can begin up to eight weeks before the expected delivery date. 

    Employees adopting a child under the age of three months are entitled to 12 weeks of paid leave, to be taken from the date the child moves in with the parent. 

    Government employees are entitled to 15 days of paternity leave. However, there are no paternity leave provisions for employees in the private sector.

    Public holidays in Mexico

    India observes the following public holidays:

    • New Year’s Day
    • Boghi
    • Makar Sankranti
    • Surya Pongal
    • Mattu Pongal
    • Kaanum Pongal
    • Republic Day
    • Vasant Panchami
    • Maha Shivaratri
    • Holi
    • Ram Navami
    • Ugadi
    • Dr Ambedkar Jayanti
    • Good Friday
    • May Day
    • Maharshi Parasuram Jayanti
    • Eid al-Fitr
    • Buddha Purnima
    • Sant Guru Kabir Jayanti
    • Eid al Adha
    • Muharram
    • Raksha Bandhan
    • Independence Day
    • Parsi New Year
    • Janmashtami
    • Ganesh Chaturthi
    • Mahalaya Amavasya
    • Gandhi Jayanti
    • Maha Navami
    • Vijaya Dashami
    • Eid e Milad
    • Diwali (3 consecutive days)
    • Bhai Dooj
    • Guru Nanak Jayanti
    • Christmas Day 

    Attracting talent in Mexico

    Attracting and retaining talent requires a balance of benefits. Companies need to go a step beyond competitive salaries if they want to attract and retain top talent in their sectors. This is because modern job seekers are looking for fair compensation and work-life balance, as well as a sense of belonging, a healthy workplace culture, and an organisation whose values match their own. 

    Some of the best ways to attract talent in India include:

    Focus on career aspirations

    It’s important to have continuous engagement between the business and the workers to ensure that the employee experience is optimal, with a maximum capacity for career growth opportunities.

    One-to-one mentorship, coaching for career advancement and continuous learning systems introduced in the workplace could significantly impact retention rates and talent acquisition. 


    Source: Pexels/RODNAE Productions

    Focus on employer branding

    As well as looking for jobs with excellent career advancement opportunities, many candidates are looking to work for a highly esteemed and reputable company. 

    When creating job specifications and advertisements, employers should think beyond financial compensation to attract and retain talent.

    Employer brand attractiveness is key to attracting and retaining employees. Some ways to improve your employer branding include maintaining a healthy environmental footprint, promoting a positive work culture and defining your company message to bring it into alignment with your employees’ values. 

    Termination of employment in Mexico

    Notice period

    The period of notice in India is usually 30 days, but this depends on several factors, such as duration of employment and the reason behind the termination. 

    Probationary periods

    Probationary periods in India are six months for non-executives and 12 months for executives. Employees are treated as on probation until they are confirmed or discharged from their position. 

    Severance pay

    Employers should offer severance pay to employees who are laid off, retire or reach the end of their contract. This is in the form of one month’s salary for employees who have worked at the company for a year or longer. 

    In the event of mass termination in protected sectors, employees should receive three months of wages as severance pay.

    Retirement age in India

    As of 2022, the maximum retirement age in India is 65 years, with the minimum age dependent on the individual company. Women can retire at any age if they have 40 years of insurance. 

    In the public sector, the retirement age is 60.

    What are my options for hiring in Mexico?

    Airswift provides a variety of employment solutions for foreign companies wishing to hire in India. Our services make it easy for you to hire employees efficiently and within full compliance with Indian labour laws.

    Our knowledge and expertise enable us to reduce risk while carrying out the administrative tasks involved in hiring and onboarding employees. This gives you more time to focus on business development.

    Talent acquisition


    Working alongside an in-country talent acquisition specialist enables you to source high-quality talent in a competitive global landscape.

    Our contract hire services allow you to fill temporary vacancies and give your organisation the agility to respond to the market's shifting demands.

    For long-term hiring requirements, our professional search service can help you find talented employees for permanent positions within your company.

    Employer of record


    For foreign companies wanting to hire remote employees without setting up a physical entity in India, an Employer of Record (EOR) simplifies the hiring process with little compromise on expense and time.

    An experienced EOR allows you to bypass the complications of physical entity setup. As they already have an established legal entity in the host country, an EOR can help you by managing locally compliant payroll, overseeing statutory benefits, paying international employees and more. 

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    *Although the information provided has been produced from sources believed to be reliable, no warranty, express or implied, is made regarding the accuracy, adequacy, completeness, legality or reliability of any information. For the latest information and specific queries regarding particular cases, please contact our team.