# The India Employee Benefits Stack for Maldivian companies

> Maldivian teams are used to a state health scheme for citizens, a matched 7% pension, 30 days' annual leave and a Ramadan allowance. In India, health cover above ₹21,000 a month is a voluntary employer benefit, EPF takes 12% from each side, leave is set by state law, and gratuity after five years is statutory.

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/maldives. Updated 2026-10-05. Part of The India Employee Benefits Stack: https://www.plumhq.com/india-benefits-stack.

## In short

- Aasandha is a state scheme for Maldivian citizens, not employer cover. In India, ESI covers only employees earning up to ₹21,000 a month; employers buy Group Health Insurance for everyone else, which is voluntary in law.
- MRPS (7% of basic salary from each side) maps to EPF: 12% employer plus 12% employee on basic plus DA. Maldivian nationals employed in India join EPF from day one on full salary; no social security agreement is in force.
- India and the Maldives have no comprehensive tax treaty, only a limited agreement on international air transport income. No treaty clause exempts short visits, so plan business trips and postings with a tax advisor.

## Questions

### Does Aasandha cover staff working in India?

Aasandha is the Maldivian state scheme providing free medical assistance to Maldivian citizens; it is not employer cover and does not extend to Indian or other foreign colleagues. In India, employees earning up to ₹21,000 a month sit in ESI (3.25% employer, 0.75% employee). Everyone else is covered only if the employer buys Group Health Insurance, which most insurers write from a group of 7.

### How does EPF compare with MRPS?

EPF is larger and covers everyone. MRPS takes 7% of basic salary from each side for local employees. EPF takes 12% from each side on basic plus DA in establishments with 20+ employees, with 8.33% of the employer share going to the pension scheme. Foreign nationals, Maldivians included, contribute on full salary from day one.

### Is there a tax treaty between India and the Maldives?

Only a limited one. The agreement in force since 1 August 2016 covers income from international air transport, and a separate 2016 agreement lets the two tax authorities exchange information. Neither has an employment article, so there is no treaty exemption for short visits. Take advice before staff travel or move.

### What leave do Indian employees get?

Less than in the Maldives. Leave is set by state Shops and Establishments Acts or the Factories Act: typically 12 to 18 days of earned leave plus casual and sick leave, against 30 days' annual leave and 30 days' sick leave in the Maldives. Maternity leave runs the other way: 26 weeks in India against 60 days.

### Do we need to provide gratuity in India?

Yes, in establishments with 10+ employees. Gratuity is 15 days' last drawn salary per year of service, payable after five continuous years (one year for fixed-term employees under the 2025 Labour Codes), capped at ₹20 lakh. The Maldivian Employment Act has no equivalent, so budget it as a new liability, provision it from day one and insure it.

## What changes when you come from the Maldives

### Assignees from the Maldives 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.
**Maldives and India.** India and the Maldives have no social security agreement. A Maldivian national employed in India joins EPF from day one on full salary, with no certificate of coverage to claim an exemption, and can generally withdraw it only at 58 or on permanent incapacity. Any MRPS contributions that continue at home are an extra cost on top.

### Mapping Maldivian benefits to India

**At home.** MRPS pension contributions for local staff, Aasandha for citizens' medical care, 30 days' annual leave, 30 days' sick leave, 60 days' maternity leave, family responsibility leave and a Ramadan allowance for Maldivian employees.
**In India.** EPF for every employee, foreign staff included; ESI or Group Health Insurance (GHI) for health; the Employees' Compensation Act and Group Personal Accident for injury; and statutory gratuity after five years, funded through an insured scheme.

### Overlap between Malé and India

**Time difference.** India is 30 minutes ahead of Malé all year (neither country uses daylight saving), so the two working days overlap almost completely.
**What to set up.** Agree who in India signs off endorsements, claims escalations and renewals, so nothing waits for headquarters' business hours.

### India–Maldives tax treaty

**Treaty.** India and the Maldives have no comprehensive double taxation avoidance agreement. A limited agreement, in force since 1 August 2016, covers only income from international air transport, and a separate 2016 agreement lets the two tax authorities exchange information. Neither has an employment article exempting short visits.
**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 the Maldives, and what it is called in India

A Maldivian employer pays 7% of each local employee's basic salary into the Maldives Retirement Pension Scheme (MRPS), matched by the employee, while the state's Aasandha scheme provides citizens' medical care. Neither carries over as employer cover when staff work in India. Here the provident fund (EPF) takes 12% from each side, whatever the employee's nationality, and health insurance above ₹21,000 a month is a voluntary employer benefit rather than a state entitlement.

| At home in the Maldives | In India | What changes for the employer |
| --- | --- | --- |
| National health insurance (Aasandha): The national social health insurance scheme, providing free medical assistance to all Maldivian citizens. | ESI for employees earning up to ₹21,000 a month; Group Health Insurance (GHI) for everyone else | A citizens' entitlement, not employer cover, and it does not extend to Indian or other foreign colleagues. Above the ESI ceiling there is no statutory cover, so employers buy GHI; the India median sum insured is ₹5,00,000 and global startups carry ₹10,00,000. |
| Retirement pension (MRPS, Maldives Retirement Pension Scheme): Mandatory for local employees aged 16 to 65: 7% of basic salary from the employee and 7% from the employer; pension from 65, early access from 55. | EPF and EPS (Employees' Provident Fund and Pension Scheme) | 12% employer (8.33% to EPS) and 12% employee on basic plus DA, in establishments with 20+ employees. Nationality is irrelevant: foreign nationals join from day one on full salary, and from a non-agreement country can generally withdraw only at 58 or on permanent incapacity. |
| Annual leave: 30 days of paid annual leave after one year of employment. | Earned leave under the state Shops and Establishments Act, plus casual and sick leave | Expect 12 to 18 days of earned leave plus separate casual and sick leave, set by state law: roughly half the Maldivian entitlement. Public holidays vary by state; only three are national. |
| Sick leave: At least 30 days' paid sick leave a year; 15 can be taken without a medical certificate, two days at a time. | Sick leave under the state Shops and Establishments Act | Set by each state, alongside casual leave, rather than nationally. Check the rules in every state where staff sit. |
| Maternity and paternity leave (Maternity leave): 60 days' paid maternity leave, up to 30 of them before the due date; fathers get three days' paid paternity leave. | Maternity Benefit Act: 26 weeks paid by the employer (12 weeks from the third child); no statutory paternity leave | About three times the Maldivian entitlement, paid by the employer (ESI pays for ESI members). A crèche is required at 50+ employees. Set the GHI maternity limit against a normal delivery of about ₹1 lakh and a C-section of about ₹1.25 lakh. |
| Family responsibility leave: 10 days' paid leave a year to attend to family obligations, such as a relative's illness. | Casual leave under state law | No separate statutory family leave. Casual leave, set by state Shops and Establishments Acts, covers short personal absences; anything more generous is company policy. |
| Ramadan allowance: MVR 3,000 for each Maldivian employee, paid before Ramadan begins. | Statutory bonus under the Payment of Bonus Act (8.33% to 20%) for employees earning up to ₹21,000 a month | India has no religious or festival allowance in law. The statutory bonus applies only up to the wage ceiling; a festival bonus above it is contractual and counts toward total remuneration for the Labour Codes' 50% test. |
| Work injury (Workplace injury care): Employers must provide or arrange medical care for employees injured at work, and notify the Minister within 48 hours of an injury needing more than first aid. | Employees' Compensation Act 1923 (or ESI where covered) plus Group Personal Accident (GPA) | India adds a compensation duty: outside ESI, the employer is liable under the Employees' Compensation Act and insures it. Group Personal Accident and Group Term Life are the usual add-ons. |

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

1. **Staff have Aasandha, so health insurance is optional.** Aasandha is a state scheme for Maldivian citizens, not employer cover, and it does not extend to Indian colleagues. India's ESI covers only staff earning up to ₹21,000 a month; above that line the employer's statutory health obligation is zero. Group Health Insurance is voluntary, but candidates hired at ₹8 LPA and above expect it.
2. **Pension contributions apply only to local staff, as with MRPS.** In India nationality does not matter. Foreign nationals, Maldivians included, are International Workers: they join EPF from day one on full salary, with no ₹15,000 ceiling, at 12% from each side. With no social security agreement, withdrawal is generally possible only at 58 or on permanent incapacity.
3. **Thirty days' annual leave is what Indian staff will expect.** Leave is set by state Shops and Establishments Acts or the Factories Act: typically 12 to 18 days of earned leave plus casual and sick leave. Public holidays vary by state, with only three national. Copying the Maldivian 30 days into India is generous by Indian law.
4. **Sixty days' maternity leave is the benchmark.** The Maternity Benefit Act gives 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). A crèche is required at 50+ employees. There is no statutory paternity leave, unlike the Maldives' three days.
5. **There is no long-service lump sum to provide for.** The Maldivian Employment Act has none, but Indian gratuity is statutory in establishments with 10+ employees: 15 days' last drawn salary per year of service after five continuous years, one year for fixed-term staff, capped at ₹20 lakh. Provision it from the first payroll and insure it.
6. **A tax treaty will cover short trips to India.** India and the Maldives have only a limited agreement, on international air transport income, plus a tax information exchange agreement. Neither has an employment article, so no treaty clause exempts short visits. Plan business trips and postings with a tax advisor.
7. **The Ramadan allowance has an Indian equivalent.** Indian law has no religious or festival allowance. Employees earning up to ₹21,000 a month are owed a statutory bonus of 8.33% to 20%. Any festival bonus above that is contractual, and it counts toward total remuneration under the Labour Codes' 50% test.

## The Maldives vs India, benefit by benefit

| Benefit | Maldives | India |
| --- | --- | --- |
| Statutory health cover | Aasandha: free medical assistance for all Maldivian citizens. | ESI for employees earning up to ₹21,000 a month. Nothing above that line. |
| Pension | MRPS: 7% employer plus 7% employee on basic salary, for local employees aged 16 to 65. | EPF and EPS: 12% employer plus 12% employee on basic plus DA. |
| Foreign staff | Outside MRPS, which mandates local employees. | International Workers: EPF from day one on full salary, with no ₹15,000 ceiling. |
| Access to retirement savings | Pension from 65; early access from 55. | International Workers from non-agreement countries can generally withdraw EPF only at 58 or on permanent incapacity. |
| Annual leave | 30 days after one year of employment. | Earned leave of 12 to 18 days plus casual and sick leave, set by state law. |
| Sick leave | At least 30 paid days a year. | Set by state law, alongside casual leave. |
| Maternity | 60 days, paid. | 26 weeks of full pay for the first two children, paid by the employer. |
| Paternity | Three days, paid. | No statutory paternity leave under central law. |
| Festival pay | Ramadan allowance of MVR 3,000 for each Maldivian employee. | No festival allowance in law; statutory bonus of 8.33% to 20% for employees earning up to ₹21,000 a month. |
| Long-service lump sum | None in the Employment Act. | Gratuity: 15 days' last drawn salary per year after five years, capped at ₹20 lakh. |
| Work injury | Employer must provide or arrange medical care for injured employees. | Employees' Compensation Act, insured by the employer, or ESI where covered. |

## Staff seconded from the Maldives

Aasandha is a citizens' scheme run from Malé, not employer cover for an Indian job, so add Maldivian secondees to an India-admitted GHI for cashless treatment at network hospitals. With no India–Maldives social security agreement, a Maldivian national on Indian payroll joins EPF from day one on full salary and can generally withdraw it only at 58 or on permanent incapacity. Agree in writing whether MRPS contributions continue at home.

## Where Maldivian companies set up in India

- **Thiruvananthapuram and Kochi, Kerala.** Maldivian has offices in both cities and flies to each from Malé.
- **Bengaluru, Karnataka.** Atmosphere Core's India office, supporting its Indian hotel portfolio; Maldivian also has an office here.
- **New Delhi and Mumbai, Delhi and Maharashtra.** Maldivian offices in both cities; Atmosphere Core launched its Indian hotel portfolio in New Delhi in 2023.

Maldivian companies with operations in India include Maldivian (Island Aviation Services), Atmosphere Core.

## 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))

## 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: Maldives Pension Administration Office: Maldives Retirement Pension Scheme (MRPS); Sixth Amendment to the Pension Act, ratified 21 May 2026; National Social Protection Agency: Social Health Insurance Scheme (Aasandha); Employment Act (Law No. 2/2008), consolidated unofficial English translation, Labour Relations Authority; Income Tax Department of India: India–Maldives Agreement for Avoidance of Double Taxation of Income Derived from International Air Transport, in force 1 August 2016; India–Maldives Agreement for the Exchange of Information with respect to Taxes, signed 11 April 2016; Company websites: Maldivian (Island Aviation Services), Atmosphere Core.