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Negotiating Desi Employment For NRIs
Move Forward
With the current debt issues in Europe and the projected double dip recession in the United States, many NRIs are opting to return to India for better employment opportunities. There are many major differences between employment overseas and employment in India. The following are the major differences in employment provisions between the two.
Salary Value. Do not expect that one would receive the same face value amount of salary for overseas work compared to employment in India. Realistically, the salary value of employment in India would be between 40 to 70% of the foreign salary value. In order to understand this, do your own computations as to the salary receivable and because one is considered as a local employee, the value paid would be comparable to local salary levels and schemes.
Cash Components. Not all salary components of the Indian employment would necessarily be cash related. These include company accommodations, car, drivers, education expenses and other fringe benefits that are not necessarily cash related. Other related benefits include insurance, food and clothing, transportation and other gratuities. Before agreeing to a desi contract, do have them itemize the cash components, fringe benefits and other receivables as part of employment.
Cash Deductions. There are many deductions applicable to the monthly salary of an individual working in India. Primary amongst them is tax and this is withheld at the source or the company. Other taxes would include withholding tax depending on the value your salary and applicable exemptions. Do seek out an advisory as to the deductions applicable to personal circumstances in order to be fully aware and apprised of the monthly budget available from the salary received.
Annualized Variable Components. There are parts of the annual salary that is subject to an annual review or subject to one's performance. These are not part of your monthly salary and entitlement only applies when conforming to set guidelines and parameters. These include travel allowances, performance bonus and other variable amounts. This may be between 15 to 50 percent of salary. One must be fully apprised of the requirements to qualify for receipt of these additional amounts, subject to other deductions applicable.
As can be seen, as an NRI, you have a clear advantage as to experience and qualifications when it comes to being employed locally. Negotiating terms of one's employment contract with employers before accepting the assignment is important to be able to live comfortably in India.
Bobby Castro is the online editor at the NRI community, where he has published a number of articles about NRI discussions and many other topics.
Article submitted Wednesday, January 04, 2012 & read 2 times.
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