10 Common Myths About Employer of Record India - Debunked

India is becoming a global talent hub, and businesses from across the world are keen to hire Indian professionals. But hiring compliantly in India can be challenging due to complex labor laws, tax regulations, and payroll systems.

That’s where an Employer of Record (EOR) in India like DevX EOR can help. Yet, many companies hesitate to use EOR services because of outdated or incorrect assumptions.

Let’s debunk the top 10 myths about using an Employer of Record in India

Myth #1: An EOR is Just Like a Staffing Agency

A staffing agency finds and places candidates. An Employer of Record India service like DevX EOR legally employs talent on your behalf, handling compliance, payroll, contracts, and statutory benefits while you retain full control of their day-to-day work.

Why it matters: Confusing the two can cost you valuable time and legal exposure. DevX EOR is not a recruitment firm, it’s a compliance partner.

Myth #2: EOR Services are Only for Big Companies

Whether you're hiring your first remote developer in India or scaling up a 10-person support team, DevX EOR is built to serve businesses of all sizes including startups and SMEs.

Why it matters: You don’t need a large HR budget or legal team to hire in India. DevX EOR makes international hiring accessible for everyone.

Myth #3: Setting Up a Legal Entity in India Is Cheaper

Setting up your own company in India comes with incorporation costs, registrations, tax filings, and HR/legal upkeep not to mention time delays. With DevX EOR, you pay a fixed monthly fee per employee and get full compliance without the overhead.

Why it matters: An EOR saves both money and months of setup time. It’s the most cost-effective way to test the Indian market.

Myth #4: EORs are Only a Temporary Fix

Many businesses use EORs like DevX as a long-term solution. Unless you plan to build a large India-based team and need a local entity, DevX EOR can support your Indian workforce for the long haul.

Why it matters: Don’t wait to “outgrow” an EOR. For many companies, it’s a smart, scalable way to hire permanently in India.

Myth #5: EORs Don’t Follow Indian Labor Laws

In reality, compliance is the core function of an EOR. DevX EOR ensures your business adheres to Indian regulations — including income tax, EPF, gratuity, and Shops & Establishment registration without risk or penalty.

Why it matters: Compliance errors in India can lead to fines, lawsuits, or reputational damage. DevX handles the red tape, so you don’t have to.

Myth #6: You Lose Control of Your Indian Employees

With DevX EOR, you maintain full control over your employee’s work, deliverables, and performance management. We just handle the backend HR, payroll, and compliance.

Why it matters: You get all the benefits of legal employment in India without giving up any operational authority.

Myth #7: EORs Don’t Offer Competitive Benefits in India

DevX EOR ensures all Indian hires receive benefits compliant with Indian law, including medical insurance, paid leave, and social security. We also help you offer enhanced benefits to attract top talent.

Why it matters: Strong benefits are key to hiring and retaining India’s best professionals. DevX helps you stay competitive.

Myth #8: Contractors are Easier Than an EOR

Hiring Indian workers as contractors may seem simpler but it’s risky. Worker misclassification can lead to serious penalties in India. DevX EOR ensures proper employee classification and legal protection.

Why it matters: If your contractor behaves like an employee, authorities may reclassify them and you’ll be liable.

Myth #9: EORs are Only Needed for Relocating Employees

Even if no one is relocating to or from India, DevX EOR enables you to tap into India’s vast talent pool and build a local presence remotely and compliantly.

Why it matters: You can hire Indian professionals without ever stepping foot in India or setting up a branch office.

Myth #10: Your HR Team Can Handle Indian Hiring Alone

Hiring in India involves local language contracts, tax compliance, payroll cycles, and mandatory filings. DevX EOR handles all of it for you freeing your HR to focus on core growth initiatives.

Why it matters: Even the best global HR teams can get stuck in India’s complex labor landscape. Let DevX simplify it.

Hire Confidently in India with DevX EOR

India offers world-class talent and cost-effective hiring but only if you do it right. With DevX EOR, you get a trusted Indian partner that handles everything from contracts and payroll to legal compliance and benefits administration.