# The India Employee Benefits Stack for Australian companies

> Australian parents are used to super paid on every payday, Medicare as the health base and leave set nationally by the National Employment Standards. India keeps a 12% retirement contribution but adds an employee share and gratuity, puts health cover on the employer and sets leave state by state.

By Akshay Golechha, Chief Business Officer at Plum (https://www.linkedin.com/in/akshaygolechha/). Published by Plum (https://www.plumhq.com). Canonical: https://www.plumhq.com/india-benefits-stack/australia. Updated 2026-10-05. Part of The India Employee Benefits Stack: https://www.plumhq.com/india-benefits-stack.

## In short

- India and Australia have a social security agreement in force since January 2016. Staff seconded from Australia with a certificate of coverage can stay in the super guarantee system and be exempt from Indian EPF for up to five years.
- India has no Medicare. Employees earning up to ₹21,000 a month are in ESI; above that the employer's statutory health obligation is zero, so Group Health Insurance carries the hospital costs Medicare would cover at home.
- The super guarantee maps to EPF (12% of basic from employer and employee), NES annual leave to earned leave under state law, and long service leave and redundancy pay to statutory gratuity after five years.

## Questions

### Do Australian secondees have to contribute to EPF in India?

Not if they hold a certificate of coverage under the India–Australia social security agreement, in force since January 2016. It lets a seconded employee stay in the super guarantee system and be exempt from Indian EPF for up to five years. Without it, a foreign national is an International Worker and contributes to EPF from day one on full salary, with no ₹15,000 ceiling.

### Is there an equivalent of Medicare in India?

No. India has no public health cover for salaried employees above ₹21,000 a month. Those at or below it sit in ESI, with 3.25% from the employer and 0.75% from the employee. Everyone else is covered only if the employer buys Group Health Insurance; the India median sum insured is ₹5,00,000 and global startups carry ₹10,00,000.

### How does EPF compare with the super guarantee?

Both start at 12%, but EPF is calculated on basic pay plus DA rather than total earnings, and the employee contributes another 12%. The employer's 12% splits 8.33% to the pension scheme (EPS) and the balance to EPF. EPF applies to establishments with 20+ employees; the statutory wage ceiling is ₹15,000 a month, though most MNC subsidiaries contribute on full basic.

### What replaces long service leave in India?

Gratuity is the closest match. It is a statutory lump sum of 15 days' last drawn salary per year of service, owed on any exit after five continuous years, or after one year for fixed-term employees under the 2025 Labour Codes. It is capped at ₹20 lakh and applies to establishments with 10+ employees.

### How much leave must we give in India?

Leave is set state by state, not nationally as under the NES. Offices follow the state Shops and Establishments Act, where earned leave is typically 12 to 18 days a year plus casual and sick leave. Public holidays vary by state, with three national holidays. Maternity leave is 26 weeks of full pay for the first two children, paid by the employer.

## What changes when you come from Australia

### Assignees from Australia and India's EPF

**The rule.** Foreign nationals employed in India are International Workers under EPF. They must join from day one, with contributions on full salary: the ₹15,000 wage ceiling does not apply.
**Australia and India.** India and Australia have a social security agreement in force since January 2016. Staff seconded from Australia with a certificate of coverage can stay in the super guarantee system and be exempt from Indian EPF for up to five years, extendable by agreement between the two countries. Get the certificate before the first Indian payroll run.

### Mapping Australian benefits to India

**At home.** Super guarantee at 12% of qualifying earnings, Medicare as the health base with optional private cover, state workers' compensation, and leave under the National Employment Standards.
**In India.** EPF for retirement, Group Health Insurance (GHI) for health, the Employees' Compensation Act and Group Personal Accident for injury, and gratuity as the statutory exit payment, funded through an insured gratuity scheme.

### Overlap between Sydney and India

**Time difference.** Sydney is 5½ hours ahead of India during Australian daylight saving (early October to early April) and 4½ hours ahead the rest of the year, so the Sydney afternoon overlaps the Indian morning. Brisbane and Perth do not change their clocks.
**What to set up.** Agree who in India signs off endorsements, claims escalations and renewals, so nothing waits for headquarters' business hours.

### India–Australia tax treaty

**Treaty.** India and Australia have a double taxation avoidance agreement, signed in 1991 and in force since 30 December 1991. Short visits are usually exempt from Indian tax under its 183-day and employer conditions; check the exact article before relying on it.
**Secondments.** Long secondments can create a permanent establishment for the parent. Structure recharges and employment contracts with a tax advisor before staff move.

## What you call it in Australia, and what it is called in India

Australian employers pay 12% of qualifying earnings into super, on every payday since 1 July 2026, and leave health care to Medicare, with private cover as an optional extra. India keeps a 12% retirement contribution but calculates it on basic pay: EPF takes 12% of basic plus DA from the employer and another 12% from the employee. Health is the gap. Above ₹21,000 a month an employer's statutory health obligation is zero, so Group Health Insurance carries the hospital risk that Medicare carries at home.

| At home in Australia | In India | What changes for the employer |
| --- | --- | --- |
| Superannuation guarantee (Super (SG)): Employer pays 12% of qualifying earnings into the employee's fund; from 1 July 2026, within 7 business days of each payday. | EPF and EPS (Employees' Provident Fund and Pension Scheme) | 12% of basic plus DA from the employer (8.33% to EPS, the balance to EPF) and 12% from the employee, for establishments with 20+ employees. Allowances above 50% of total remuneration are added back into wages under the Labour Codes, in force since 21 November 2025. |
| Public health insurance (Medicare): Universal public cover for hospital and medical care, funded through tax including the Medicare levy. | ESI below ₹21,000 a month; nothing statutory above it | There is no public base for salaried staff above the ESI ceiling. Group Health Insurance is what employees rely on for hospital care, and candidates hired at ₹8 LPA and above expect it. |
| Private health insurance (Private hospital and extras cover): Optional cover for private hospital care and extras such as dental and optical. Employer-paid cover is generally a fringe benefit. | Group Health Insurance (GHI) | In India the employer policy is the main cover, not an extra. Most insurers need a group of at least 7. The India median sum insured is ₹5,00,000; global startups carry ₹10,00,000. The premium is deductible under Section 36(1)(ib) and not a perquisite under Section 17(2). |
| Annual leave (NES annual leave): Four weeks of paid leave a year for full-time staff, five weeks for some shift workers. | Earned leave under the state Shops and Establishments Act | Earned leave is typically 12 to 18 days a year plus casual and sick leave, set state by state rather than nationally. Public holidays vary by state, with three national holidays. |
| Personal and carer's leave (Personal/carer's leave): 10 days of paid personal/carer's leave a year, accumulating from year to year. | Sick and casual leave under state law | Separate sick and casual leave buckets set by each state's Shops and Establishments Act, alongside earned leave. |
| Paid parental leave (Parental Leave Pay): Government-funded pay at the national minimum wage, 26 weeks for children born from 1 July 2026, plus 12 months' unpaid leave under the NES. | Maternity Benefit Act: 26 weeks of full pay | Paid at full salary by the employer, not by the government: 26 weeks for the first two children, 12 weeks from the third (ESI covers it for ESI members). Crèche required at 50+ employees. No statutory paternity leave under central law. |
| Long service leave (LSL): Extra paid leave after long continuous service, set by state and territory law. | Gratuity under the Payment of Gratuity Act | The closest Indian match for a long-service entitlement: 15 days' last drawn salary per year of service after five continuous years (one year for fixed-term staff), capped at ₹20 lakh, owed on any exit. Provision it from day one. |
| Redundancy pay (NES redundancy pay): 4 to 16 weeks' pay by length of service, after at least one year; small business employers are exempt. | Gratuity, plus the notice period in the contract | Gratuity is owed on any exit after five continuous years, not only redundancy, for establishments with 10+ employees. Notice for office staff is usually set by the employment contract. |
| Notice of termination (NES notice): One to four weeks by length of service, plus a week for employees over 45 with at least two years' service. | Contractual notice period | Set in the offer letter and employment contract. Agree it at hiring and align it with gratuity, which is payable on top once five years' service is reached. |
| Workers' compensation (Workers' comp): State and territory schemes insuring work injuries, funded by employer premiums. | Employees' Compensation Act 1923 (or ESI where covered) plus Group Personal Accident (GPA) | The Act covers employees not in ESI, and the employer insures the liability. GPA is the usual voluntary add-on for accidental death and disability. |
| Life and disability cover (Insurance through super): Death and total and permanent disability cover, often held inside the employee's super fund. | Group Term Life (GTL), GPA and EDLI through EPFO | EDLI gives life cover of up to ₹7 lakh through EPFO. GTL at 3 to 5 times CTC is common for white-collar staff, bought by the employer as a separate group policy. |

## What Australian companies get wrong when they set up in India

1. **Medicare covers them, so private cover is an optional extra.** India has no Medicare. Above ₹21,000 a month an employer's statutory health obligation is zero, and Group Health Insurance is what pays for hospital care. Candidates hired at ₹8 LPA and above expect it; global startups in India carry ₹10,00,000 sum insured.
2. **EPF at 12% costs the same as the super guarantee.** EPF is 12% of basic plus DA, not total earnings, and the employee adds 12% of their own. Since 21 November 2025, allowances above 50% of total remuneration are added back into wages for EPF and gratuity, so basic cannot be kept artificially low.
3. **The government funds parental leave pay, so the employer cost is small.** The Maternity Benefit Act requires 26 weeks of full pay for the first two children and 12 weeks from the third, paid by the employer (ESI covers it for ESI members). GHI then pays the hospital bill: a normal delivery costs about ₹1 lakh, a C-section about ₹1.25 lakh.
4. **Long service leave is the only reward for staying.** Gratuity is statutory: 15 days' last drawn salary per year of service after five continuous years, one year for fixed-term staff, capped at ₹20 lakh, owed on any exit including resignation. Provision it from the first payroll and insure it through a gratuity fund.
5. **The NES sets leave nationally, so one leave policy fits India.** Leave comes from state Shops and Establishments Acts: earned leave is typically 12 to 18 days a year plus casual and sick leave, and public holidays vary by state, with three national holidays. A national policy must still meet each state's floor.
6. **Secondees stay in super automatically while they are away.** Only with a certificate of coverage under the India–Australia agreement, which allows up to five years. Without one, a foreign national on Indian payroll is an International Worker and joins EPF from day one on full salary, with no ₹15,000 ceiling.
7. **Family cover is up to the employee, as with private health.** In India families expect to be on the group policy, and many employees ask for their parents too. Parents are the largest claims category by relationship, about 40% of claims in Plum's data, so decide parental cover deliberately rather than by default.

## Australia vs India, benefit by benefit

| Benefit | Australia | India |
| --- | --- | --- |
| Statutory health cover | Medicare: universal public cover for hospital and medical care. | ESI for employees earning up to ₹21,000 a month. Nothing statutory above that line. |
| Employer health cover | Not required; employer-paid private cover is generally a fringe benefit. | GHI optional in law, expected in practice; not a perquisite, with 18% GST on the premium. |
| Employer retirement contribution | Super guarantee: 12% of qualifying earnings, paid within 7 business days of payday from 1 July 2026. | EPF and EPS: 12% of basic plus DA, mandatory at 20+ employees. |
| Employee retirement contribution | None compulsory; voluntary contributions are optional. | 12% of basic plus DA, compulsory. |
| Annual leave | Four weeks a year under the NES, five for some shift workers. | Earned leave typically 12 to 18 days a year plus casual and sick leave, set by state law. |
| Sick leave | 10 days' paid personal/carer's leave a year, accumulating. | Separate sick and casual leave under each state's Shops and Establishments Act. |
| Parental pay | Government Parental Leave Pay at the national minimum wage, 26 weeks for births from 1 July 2026. | Employer pays 26 weeks of full salary for the first two children; 12 weeks from the third. |
| Partner leave | Partners can share government Parental Leave Pay and take unpaid parental leave under the NES. | No statutory paternity leave under central law. |
| Long service | Long service leave under state and territory law. | Gratuity: 15 days' last drawn salary per year after five years, capped at ₹20 lakh. |
| Redundancy | NES redundancy pay of 4 to 16 weeks after one year, except at small businesses. | Gratuity on any exit after five years; notice set by contract. |
| Notice | One to four weeks by service, plus one week if over 45 with two years' service. | Set by the employment contract. |
| Injury cover | State and territory workers' compensation schemes, employer-funded. | Employees' Compensation Act or ESI, plus voluntary Group Personal Accident. |

## Staff seconded from Australia

Australian secondees can stay in the super guarantee system and out of Indian EPF for up to five years, with a certificate of coverage under the India–Australia agreement. Without one, they join EPF from day one on full salary. Medicare does not cover treatment overseas, so most carry an international medical plan; adding them to the India GHI gives cashless admission at network hospitals without paying upfront.

## Where Australian companies set up in India

- **Bengaluru, Karnataka.** ANZ, Commonwealth Bank, NAB, Telstra and Atlassian run technology and operations centres here. Highest GHI adoption of any city in Plum's benchmark, so candidates expect a global-standard plan.
- **Delhi NCR, Haryana and Uttar Pradesh.** Macquarie in Gurugram and Aristocrat in Noida. Two states' leave laws apply across one metro, so check which Shops and Establishments Act covers each office.
- **Mumbai, Maharashtra.** Macquarie's banking and asset management teams. Highest average claim size of any city in Plum's benchmark; calibrate sum insured to Mumbai hospital costs before matching an Australian plan design.

Australian companies with operations in India include ANZ, Commonwealth Bank, NAB, Macquarie, Telstra, Atlassian, Aristocrat, Brambles (CHEP).

## Benchmarks: what MNCs and GCCs offer in India

From [The Standard of Employee Benefits 2026–27](https://www.plumhq.com/standard-of-employee-benefits), Plum's report on 15,312 benefit plans, 5,20,100 claims and 74,543 checkups from Plum's FY26 book.

- **1.6×** MNC and GCC benefits spend per employee in India, against a funded Indian startup (nearly 3× a local Indian business). ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **43%** of MNCs and GCCs in India are Holistic Leaders: deep insurance plus real breadth of healthcare beside it. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **₹7,50,000** median MNC/GCC sum insured, covering parents or in-laws, with ₹1,00,000 maternity cover and no copays or sub-limits. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **~2%** of payroll buys India's top-quartile plan, against roughly 15% in the US, 10–25% across Europe and 8–15% across APAC. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3-coverage))

### India's top-quartile plan against Australia

| | India | Australia |
|---|---|---|
| Benefits budget, share of payroll | ~2–3.5% (2% typical), plus 13% PF and 4.81% gratuity | ~12–15% (APAC 8–15% band), plus 12–18% superannuation |
| What the employee still pays | Nothing: no deductible, no copay or coinsurance, no room-rent limit, no waiting period | Medicare gap payments, a hospital excess on the policy and annual dollar limits on dental and vision |
| Who is on the policy | Employee, spouse, up to 4 children, 2 parents or in-laws, LGBTQ+ and live-in partners | Employee; family cover as an upgrade |

India's top-quartile plan is the only one of the seven that includes parents, and treatments cost 60–90% less than in the US, Europe or Australia. Source: https://www.plumhq.com/standard-of-employee-benefits#s2-3-coverage

## Further reading on plumhq.com

- [How MNCs structure health insurance for Indian subsidiaries](https://www.plumhq.com/blog/mnc-health-insurance-india-subsidiary-structure): Global programmes, local policies and who signs what.
- [Do you need to match headquarters' benefits in India?](https://www.plumhq.com/blog/gcc-match-headquarters-benefit-standards-india): Where to mirror the parent plan, and where India needs its own design.
- [Insurance for expatriate employees in India](https://www.plumhq.com/blog/insurance-coverage-expatriate-employees-gcc-india): Covering seconded staff alongside the local plan.
- [Group insurance vs ESI: a guide for employers](https://www.plumhq.com/blog/group-insurance-vs-esi-employers-guide): Who must be in ESI, and where group health insurance takes over.
- [How to calculate gratuity in India](https://www.plumhq.com/blog/how-to-calculate-gratuity): Formulas, worked examples and a free calculator.
- [The Standard of Employee Benefits 2026–27](https://www.plumhq.com/standard-of-employee-benefits): Benchmarks from 4,500+ Indian employee health plans.

Sources: Australian Taxation Office, Payday Super and the super guarantee rate; Superannuation Guarantee (Administration) Act 1992, compilation of 1 July 2026; Fair Work Act 2009, National Employment Standards, compilation of 7 July 2026; Paid Parental Leave Act 2010, compilation of 19 September 2026; Agreement between Australia and India on Social Security, signed 18 November 2014; Social Security (International Agreements) Amendment (Republic of India) Regulation 2015; India–Australia Agreement for the avoidance of double taxation, in force 30 December 1991; Code on Social Security 2020 and Code on Wages 2019, in force 21 November 2025.