# The India Employee Benefits Stack for Korean companies

> Korean parents are used to four social insurances, statutory severance after one year and employer-provided health checks. In India the statutory layer is thinner: no health cover above ₹21,000 a month, no unemployment insurance, and a gratuity that accrues at half the Korean rate and vests after five years.

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

## In short

- There is no equivalent of Korea's national health insurance in India for salaried staff. Employees above ₹21,000 a month have no statutory cover; employers buy Group Health Insurance. National pension maps to EPF at 12% employer plus 12% employee on basic plus DA.
- Korean statutory severance (toejikgeum) maps to gratuity: 15 days' last drawn salary per year of service after five continuous years, capped at ₹20 lakh, against Korea's 30 days' average wages per year after one year.
- The India–Korea Social Security Agreement, in force since 1 November 2011, covers pensions. A seconded worker with a certificate of coverage stays in Korea's National Pension and is exempt from Indian EPF for up to 60 months.

## Questions

### Is there an equivalent of national health insurance in India?

Not for most salaried staff. Employees earning up to ₹21,000 a month are covered by ESI, funded at 3.25% by the employer and 0.75% by the employee. Above that wage India has no statutory health cover, so employers buy Group Health Insurance. It is voluntary in law but expected by candidates hired at ₹8 LPA and above.

### Do Korean expatriates (jujaewon) have to contribute to EPF in India?

Not if they hold a certificate of coverage under the India–Korea Social Security Agreement, in force since 1 November 2011. It exempts a seconded worker from EPF for the first 60 months, including secondments to a subsidiary. Without the certificate, an International Worker contributes 12% plus 12% on full salary with no ₹15,000 ceiling. Apply before the posting starts.

### What replaces statutory severance (toejikgeum) for Indian employees?

Gratuity. Establishments with 10+ employees owe 15 days' last drawn salary per year of service after five continuous years, or one year for fixed-term employees under the 2025 Labour Codes, capped at ₹20 lakh. That is half the Korean accrual and slower to vest, and the liability should be provisioned and insured from day one.

### Does India have unemployment or long-term care insurance?

No. There is no contribution equivalent to Korea's employment insurance or long-term care insurance. Exit costs in India sit in notice pay and gratuity, and what Indian employees ask for instead is health cover for their parents, who account for about 40% of claims by relationship in Plum's data.

### How do maternity and paternity leave compare?

India's Maternity Benefit Act gives 26 weeks of full pay for the first two children and 12 weeks from the third, paid by the employer rather than employment insurance; ESI covers it for ESI members. A crèche is required at 50+ employees. There is no statutory paternity leave under central law, against Korea's 20 days of spousal childbirth leave.

### Is group health insurance tax-deductible in India?

Yes. The employer's Group Health Insurance premium is deductible under Section 36(1)(ib) of the Income-tax Act and is not a perquisite for the employee under Section 17(2). 18% GST applies to group health premiums. Most insurers need a minimum group of 7, and global startups in India carry a sum insured of ₹10,00,000.

## What changes when you come from South Korea

### Assignees from South Korea 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.
**South Korea and India.** India and South Korea have a social security agreement in force since 1 November 2011. It covers pensions: staff seconded from Korea, including to a subsidiary, with a certificate of coverage stay in Korea's National Pension and are exempt from Indian EPF for the first 60 months. Get the certificate before the first Indian payroll run.

### Mapping Korean benefits to India

**At home.** National health insurance, national pension, employment insurance and industrial accident insurance through the employer, plus statutory severance or a retirement pension plan worth at least 30 days' average wages per year of service.
**In India.** Group health insurance (GHI) for health, EPF for pension, and the Employees' Compensation Act plus Group Personal Accident for injury. Gratuity is the Indian severance: fund it through an insured gratuity scheme rather than carrying it as an unfunded liability.

### Overlap between Seoul and India

**Time difference.** Seoul is 3½ hours ahead of India all year (neither country uses daylight saving), so Korean afternoons overlap Indian mornings.
**What to set up.** Agree who in India signs off endorsements, claims escalations and renewals, so nothing waits for headquarters' business hours.

### India–South Korea tax treaty

**Treaty.** India and South Korea have a revised double taxation avoidance agreement, signed in May 2015 and in force since 12 September 2016. Short visits are usually exempt from Indian tax under the treaty's 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 South Korea, and what it is called in India

There is no national health insurance (gungmin geongang boheom) in India for salaried staff. An employee earning more than ₹21,000 a month has no statutory health cover at all, and staff below that line sit in ESI. Korea's four major insurances map onto a thinner Indian layer: EPF for pension, ESI below the wage line, the Employees' Compensation Act for injury, and nothing for unemployment. Statutory severance (toejikgeum) has an Indian counterpart in gratuity, at half the Korean rate.

| At home in South Korea | In India | What changes for the employer |
| --- | --- | --- |
| National health insurance (국민건강보험, Gungmin Geongang Boheom): Universal health insurance: 7.19% of pay in 2026, split equally between employer and employee. | ESI for employees earning up to ₹21,000 a month; Group Health Insurance (GHI) for everyone else | No statutory cover above the ESI ceiling. GHI is voluntary in law and expected by candidates hired at ₹8 LPA and above. The India median sum insured is ₹5,00,000; global startups in India carry ₹10,00,000. |
| National pension (국민연금, Gungmin Yeongeum): 9.5% of pay in 2026, split equally, rising 0.5 points a year to 13% in 2033 under the 2025 reform. | EPF and EPS (Employees' Provident Fund and Pension Scheme) | 12% employer plus 12% employee on basic plus DA, with 8.33% of the employer share going to the pension scheme. The statutory ceiling is ₹15,000 a month, but most MNC subsidiaries contribute on full basic, and International Workers contribute on full salary. |
| Employment insurance (고용보험, Goyong Boheom): Unemployment benefit at 1.8% of pay, split equally, plus an employer-only 0.25% to 0.85% for job stability and training. | No equivalent | Nothing to contribute. Exit costs in India sit in notice pay and gratuity rather than an insurance fund. |
| Industrial accident insurance (산재보험, Sanjae Boheom): Employer-only, priced by industry. The 2026 average is 1.47% of pay, including commuting accidents. | Employees' Compensation Act 1923 (or ESI where covered) plus Group Personal Accident (GPA) | The Act covers employees not in ESI, and the employer insures it. GPA is the usual add-on, and Group Term Life at 3 to 5 times CTC is common for white-collar staff. |
| Statutory severance pay (퇴직금, Toejikgeum): At least 30 days' average wages per year of service, for employees with one year or more, paid as a lump sum or through a retirement pension plan. | Gratuity under the Payment of Gratuity Act | Half the Korean accrual and slower to vest: 15 days' last drawn salary per year of service after five continuous years (one year for fixed-term employees), capped at ₹20 lakh. Statutory, not discretionary. Provision it from day one and insure it through a gratuity scheme. |
| Retirement pension plan (퇴직연금, Toejik Yeongeum): Externally funded DB or DC plan that can replace lump-sum severance under the Employee Retirement Benefit Security Act. | Insured gratuity scheme | The Indian way to fund the severance liability is an insured gratuity scheme. Paying EPF on full basic rather than the ₹15,000 ceiling, as most MNC subsidiaries do, adds a defined-contribution element on top. |
| Long-term care insurance (장기요양보험, Janggi Yoyang Boheom): Levied on top of health insurance, at 13.14% of the health premium in 2026. | None | Nothing to contribute. Indian employees ask instead for parents to be covered under GHI; parents are the largest claims category by relationship, about 40% of claims in Plum's data. |
| General health check-up (일반건강진단, Ilban Geongang Jindan): Required under the Occupational Safety and Health Act: every two years for office workers, every year for others. | Statutory only for hazardous processes under the Factories Act; otherwise a voluntary benefit | If headquarters wants it group-wide, run it in India as an employer benefit, such as an annual on-site camp at the plant. |
| Annual paid leave (연차유급휴가, Yeoncha Yugeup Hyuga): 15 days after a year with 80% attendance, plus one day every two years from the third year, up to 25. | Earned leave under the state Shops and Establishments Act (offices) or the Factories Act (factories) | Earned leave is typically 12 to 18 days a year plus casual and sick leave, and varies by state and by whether the site is a factory or an office. Public holidays also vary by state, with three national holidays. |
| Maternity leave (출산전후휴가, Chulsan Jeonhu Hyuga): 90 days, or 120 for multiple births, funded partly by employment insurance. | Maternity Benefit Act: 26 weeks of full pay for the first two children, 12 weeks from the third | Paid by the employer, not an insurer (ESI covers it for ESI members). A crèche is required at 50+ employees. Set the GHI maternity sub-limit against about ₹1 lakh for a normal delivery and ₹1.25 lakh for a C-section. |
| Spousal childbirth leave (배우자 출산휴가, Baeuja Chulsan Hyuga): 20 days' paid leave for fathers since 23 February 2025, usable in up to four blocks within 120 days of the birth. | No statutory paternity leave under central law | Any paternity leave in India is company policy. If headquarters wants the Korean 20 days applied, write it into the Indian leave policy. |

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

1. **Severance accrues at 30 days a year from year one, as at home.** Gratuity accrues at 15 days' last drawn salary per year and vests only after five continuous years (one year for fixed-term employees), capped at ₹20 lakh. Paying the Korean formula in India is a voluntary enhancement; cost it as one.
2. **Everyone is in national health insurance.** Only employees earning up to ₹21,000 a month are in a statutory scheme, ESI. Above that line India has no statutory health obligation at all. Group Health Insurance is voluntary in law, and candidates hired at ₹8 LPA and above expect it.
3. **The social security agreement exempts our expatriates from everything.** It covers pensions only. With a certificate of coverage a seconded worker is exempt from EPF for up to 60 months. It does nothing for health cover in India, and without the certificate the worker joins EPF on full salary from day one.
4. **Maternity leave is partly paid by employment insurance.** In India the employer pays 26 weeks of full pay for the first two children, and 12 weeks from the third, under the Maternity Benefit Act. ESI covers it only for ESI members. A crèche is required at 50+ employees.
5. **Fathers get 20 days of paid leave by law.** India has no statutory paternity leave under central law. Any paternity leave is company policy, so write it into the Indian leave policy if headquarters wants it applied.
6. **Our allowance-heavy pay structure can carry over unchanged.** Under the Labour Codes, in force from 21 November 2025, if allowances excluded from wages exceed 50% of total remuneration, the excess is added back into wages for EPF, gratuity and other statutory calculations. A low basic no longer keeps those costs down.
7. **Industrial accident insurance means injury cover is handled.** The Employees' Compensation Act 1923 covers employees not in ESI, and the employer insures it. Group Personal Accident is the usual add-on, with Group Term Life at 3 to 5 times CTC common for white-collar staff.
8. **Family cover means spouse and children.** Parents are the largest claims category by relationship in India, about 40% of claims in Plum's data. Whether to cover them is the biggest single design choice in a GHI policy, and Indian candidates ask about it.

## South Korea vs India, benefit by benefit

| Benefit | South Korea | India |
| --- | --- | --- |
| Statutory health cover | Universal national health insurance for all employees. | ESI for employees earning up to ₹21,000 a month. Nothing above that line. |
| Employer health contribution | 3.595% of pay in 2026, matched by the employee, plus the long-term care levy. | 3.25% of wages into ESI below the line. Above it, a voluntary GHI premium. |
| Pension | National pension at 9.5% of pay in 2026, split equally, rising to 13% by 2033. | EPF and EPS at 12% employer plus 12% employee on basic plus DA. |
| Severance | At least 30 days' average wages per year of service, after one year. | Gratuity: 15 days' last drawn salary per year after five years, capped at ₹20 lakh. |
| Unemployment insurance | 1.8% of pay split equally, plus 0.25% to 0.85% from the employer. | None. Exit costs sit in notice pay and gratuity. |
| Work injury | Industrial accident insurance, employer-only, averaging 1.47% of pay in 2026. | Employees' Compensation Act 1923 for staff not in ESI, insured by the employer; GPA added voluntarily. |
| Maternity | 90 days, partly funded by employment insurance. | 26 weeks of full pay for the first two children, 12 from the third, paid by the employer. |
| Paternity | 20 days' paid spousal childbirth leave. | No statutory paternity leave under central law. |
| Paid leave | 15 days after one year, rising to 25 with service. | Earned leave typically 12 to 18 days a year plus casual and sick leave, set by state law or the Factories Act. |
| Health check-up | Employer must provide one: every two years for office staff, yearly for others. | Statutory only for hazardous factory processes. Otherwise a voluntary benefit. |
| Long-term care | 13.14% of the health premium in 2026. | None. Employees ask for parental health cover instead. |
| Seconded staff's pension | Stay in national pension with a certificate of coverage. | Exempt from EPF for up to 60 months under the 2011 agreement; otherwise EPF on full salary. |

## Staff seconded from South Korea

Expatriate staff usually keep a Korean or global medical policy, but an India-admitted GHI is still worth adding: it gives cashless admission at network hospitals with no deposit. On social security, the India–Korea agreement lets a seconded jujaewon with a certificate of coverage from Korea's National Pension Service stay in the Korean pension and be exempt from Indian EPF for up to 60 months. Without the certificate, EPF applies on full salary from day one.

## Where Korean companies set up in India

- **Irungattukottai and Sriperumbudur, Tamil Nadu.** Hyundai's main Indian plant, Hyundai Mobis, Samsung's appliance plant and the Korean supplier base around Chennai. Tamil Nadu has its own Shops and Establishments leave rules for office staff.
- **Noida and Greater Noida, Uttar Pradesh.** Samsung's Noida smartphone factory and LG Electronics' Greater Noida plant. Large shop-floor workforces split between ESI and Group Health Insurance.
- **Anantapur and Penukonda, Andhra Pradesh.** Kia's plant and its suppliers. A thinner hospital network than the metros; plan the GHI network with Bengaluru hospitals in mind.
- **Talegaon, Chakan and Ranjangaon, Maharashtra.** Hyundai's Talegaon plant, acquired from General Motors, LG's Ranjangaon plant and HD Hyundai Construction Equipment at Chakan. Pune is one of the seven cities benchmarked in the hub guide.
- **Bengaluru, Karnataka.** Samsung R&D Institute Bangalore and other Korean technology centres. Mostly salaried engineers above the ESI ceiling.

Korean companies with operations in India include Samsung, Hyundai Motor India, Kia India, LG Electronics India, Hyundai Mobis, POSCO, Lotte India, Doosan, Hyosung, HD Hyundai Construction Equipment, Mirae Asset, Shinhan Bank.

## 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: Ministry of Health and Welfare, 2026 health insurance contribution rate of 7.19% (mohw.go.kr); National Health Insurance Service, 2026 contribution rates including long-term care (nhis.or.kr); Ministry of Health and Welfare and National Pension Service, 2025 pension reform and the 9.5% rate from January 2026 (nps.or.kr); Ministry of Employment and Labor, employment insurance rates and the 2026 industrial accident insurance rate (moel.go.kr); Employee Retirement Benefit Security Act, Article 8; Labor Standards Act, Articles 60 and 74; Equal Employment Opportunity and Work-Family Balance Assistance Act, as amended February 2025; Occupational Safety and Health Act, general health check-ups; India–Korea Social Security Agreement, in force 1 November 2011 (National Pension Service); India–Korea Double Taxation Avoidance Agreement, in force 12 September 2016 (CBDT); Code on Social Security 2020 and Code on Wages 2019, in force 21 November 2025.