Building remote teams in India
                     Building remote teams in India
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The COVID-19 pandemic disrupted a great many businesses 
worldwide.  The pandemic tested the resilience of companies to 
doing business under  uncertain conditions. There was confusion 
followed by chaos as California  was the first state in the US to 
lockdown. Economic activity seemed to be  coming to a grinding 
halt. Businesses had to rapidly learn new ways of  conducting 
business as their employees were forced to stay home.  Physical 
teams started transforming rapidly into virtual teams. It took a 
 while but gradually remote work and work from home became 
mainstream.
In this blog, we aim to address concerns about arriving at the 
know-how of  hiring a remote team. How an Employer of Record 
services, i.e EOR  services in India or an International PEO can 
contribute to finding the right  fit with relevant experiences at 
competitive rates.
Our blog will educate you on exploring India as a prospective 
location for  skilled resources, the risks, advantages, costs, and 
strategies for hiring  and retaining a remote team in India. As well 
as how Professional  Employer Organizations, i.e PEO services 
in India can outrun and serve  as the best alternative compared to 
the other routes of remote hiring.
The remote working trend becomes 
mainstream
As it became evident to businesses that high-caliber workers were 
easily  available in other countries like India for a fraction of the 
cost, it  kick-started a race to hire overseas employees. There 
emerged an  opportunity for certain types of businesses using 
cloud and telecom  technologies to leverage remote workforce 
and gain a strategic advantage  in their marketplaces.
The pandemic had indeed leveled the playing field for workers to 
provide  their service to businesses out of their native country. 
The wave of remote  working started by platforms like Upwork, 
Fiverr, Freelancer, Brickworks,  and the likes got expedited by the 
pandemic.
The pandemic has encouraged successful remote teams’ work  
culture
The post-pandemic revolutionized the concept of work and 
business  ecosystem altogether.
Interestingly, the Netherlands has decided to prioritize its 
employees’  work-life balance. They are just a step away from 
becoming the first  country to provide work-from-home legally if 
the law is approved by the  Senate. The pandemic was 
instrumental in playing a huge role in  implementing remote 
hiring and increasing staff productivity.
India as a preferred destination for skilled manpower
India is perceived as a land of opportunity for its cultural, well-
educated,  and diverse background. India has a talent pool of 
highly educated and  skilled professionals who are adept at 
problem-solving abilities and are
immensely creative. People from India hail from different regions 
and bring  various cultures and thought processes to the table. As 
per Quora, 4.4  million employees from India were employed in 
the IT and ITES sectors as  of 2020.
Diving into the specifics of India, India holds the second-largest  
English-speaking manpower. It churns out a great tech talent of 
1.5 million  engineers yearly from various tier 1 and tier 2 
engineering premier  institutes like the Indian Institutes of 
Technology (IIT) and National  Institutes of Information 
Technology (NIT). According to the report  published by the 
National Survey of India, the literacy rate of India as of  2022 is 
77.7 %. India ranks 159 amongst 197 countries.
The cost of living in India on average is 64.6% lower than that of 
the US.  The country’s average population is young. Moreover, it 
is quite easy to  find staff who are eager to succeed and adapt to 
new business ethos. The  salary packages are lower which 
means businesses in the west can have  a larger workforce for the 
same budget.
India has over 75% of the World’s CMM-Level 5 companies and 
has the  highest number of ISO-9000 certified companies. 
Whether you are  offshoring to India or hiring Indian talents, high 
standards, professionalism,  and reliability are a given. The 
Indian IT sector today is estimated to be
$235 billion.
Companies emphasizing virtual team building
The journey of global companies exploring remote hiring dates 
back to  global airlines like Texas Instruments and British Airways 
availing their  back-end offices in India. IT/ITES companies 
followed the lead realizing  India has great communication, 
technological and high-end telecom  facilities. It has favorable 
business working environments as well. From  1945-1994, 
companies like International Business Machines (IBM),  American 
Express, and American Telephone and Telegraph Company  (AT&T) 
permitted their employees to telecommute. Considering the  
telecommuting study conducted by the United States Federal 
Government
reduced the employees’ commutingexpenses and increased
their  productivity.
Today a lot of global software giants like Oracle, Microsoft, SAP, 
etc  outsource to India by acknowledging its potential. India has a 
strong  industrial base, growing infrastructure, and digitization. As 
well as an  enthusiastic start-up population, encouraging growth, 
and partnering vision  from the Government. In fact, 8% of India’s 
total Gross Domestic Product  (GDP) is accounted for in the 
IT/ITES industry in 2020. The software  industry of India has given 
out an output of $16 billion. The leading IT  companies of India 
are well equipped with attractively designed buildings  and posh 
campuses in prime locations.
The influx of global companies during the pandemic
There was a surge of companies coming to India. India benefited 
hugely  from the pandemic. It’s one of the biggest countries in 
the world with a
fast-growing economy, so it wasn’t a surprise why it became the 
top  destination for hiring a remote team.
To get some context, the Indian Ministry of Corporate Affairs 
(MCA)  registered more than 124,000 companies in 2019-20, 
155,000 in 2020-21  (25% growth), and 167,000 (8% growth) 
companies registered in the  financial year 2021-22.
During FY 2021-22, the states that registered the largest number 
of  companies were Maharashtra with 31,107 companies, followed 
by Uttar  Pradesh at 16,969, Delhi at 16,323, Karnataka at 
13,403, and Tamil Nadu  at 11,020 companies.
Advantages of hiring a remote team and leading remotely 
 Broadens brand reach in two countries
By narrowing down on India as a prospective location for your 
global  business expansion plans, you will have an opportunity to 
augment your  brand visibility and culture in dual countries.
Remote hiring allows you to tap into a pool of diverse and adept 
 population
India is a place of robust diversity. Skilled professionals stem 
from different  regions, have an ingrained ability to adjust, and 
are adept at  problem-solving skills. The authors of ‘Jugaad 
Innovation’ advise the West  to consider Indians as an emerging 
market offering creative solutions in  the business world.
Avail skilled resources at reduced costs
When you hire a remote team, it works out great from a cost 
perspective  point of view. The wage rates and compensation 
policies in India are  different, to be precise they are 
comparatively low. There is scope for  negotiation in India. Also, 
the costs of recruiting are affordable. You can  resource remote 
employees in India at an affordable budget in comparison  to your 
on-location or in-house employees.
Leverage the variation of job vacancies in India and time zones
The number of engineers graduating every year is way more than 
the job  vacancies available in Indian companies. You can 
leverage the difference  in this situation. You can profit from the 
difference in the time zones. You  can make use of your remote 
team after the closure of business hours  (COB) in your country. 
With this, you will be able to avail of the clock  customer service 
and enhance business productivity.
Disadvantages of remote hiring
Easy distraction and experiencing isolation
When employees work from home, they can get easily distracted. 
Their  attention span may be compromised. In extreme cases, 
some employees  may even feel isolated and can sink into 
depression as constant  monitoring by superiors can be 
disturbing.
Asynchronous communication can be inconvenient sometimes
The difference in time zones and geographical barriers can prove 
as a  hindrance in managing a remote team. The scheduling of 
meetings and  follow-ups may be inconvenient keeping in mind 
the availability of  employees, managers, HRs, and employers. 
You will lose direct control  and will have to coordinate with 
your employees virtually. Meetings will  have to be scheduled 
considering the availability factors.
Decoding the employee mindset of India
While hiring resources from India, it is imperative to understand 
their work  culture. The employees in India like to have 10-15% 
hikes on an annual  basis. They prefer favorable taxations, travel 
allowances, health insurance  coverages, incentives, etc. They 
prefer a decent number of public  holidays. They like working in 
modern offices and futuristic office spaces.
Staying digitally connected comes with an expense
Ensuring team coordination and collaboration may be worrisome. 
You may  face security issues and also incur technological costs to 
ensure a smooth  virtual business operation.
Put in extra efforts
This means ensuring your employees feel welcomed into your 
company  irrespective of the geographical barriers and 
differences in time zones.  Most importantly, you will have to put 
in efforts to understand their  behavioral approaches and adjust 
to their culture accordingly.
To gather a better understanding of hiring employees in India and 
how we,  at Remunance, ease your journey, visit 
hiring employees in India: a guide  for foreign companies.
How can you find new employees remotely?
There are different methods of hiring employees remotely. You can 
source  the right talent through online job portals like Naukri and 
Indeed.
You can also use LinkedIn as a social media platform to find 
activities as  well as passive talent. Linkedin has 62 million users 
from India making it  the second-largest market for networking 
platforms. According to Linkedin  data, employees in India 
research mechanical and software engineering  job roles the 
most on social media networking sites. University campus  
placements or approaching recruitment agencies is also a great 
way of  resourcing talent.
However, the approach an International PEO or Employer of 
Record  services will offer will take off all the stress from your 
plate.
How do you ensure remote team building in India?
Every job seeker desires for Google-style work environment 
where the  tech giant ensures employee happiness as a top 
priority. While you may  practically not be able to create an adult 
playground kind of work  environment for your employees but 
you can surely imbibe their  organizational values for leading 
remotely.
Implementing employee-centric best HR practices and a good HR 
strategy  play a major role in meeting business productivity and 
execution. The  sooner you dawn on the realization that 
employees are the biggest asset  of your company, the faster you 
will be able to climb the ladder of success.
Keeping an open-door policy
Emphasizing creating a happy workplace culture 
 Encouraging innovation and new ideas
To know more about Best HR practices, visit our blog 
Best HR practices  for business growth.
What are the costs of hiring a remote team?
Depending on the way you decide to hire or the business model 
you  choose to adopt, you will have different costs associated with 
hiring remote  workers. E.g. if you are going to set up your legal 
entity or hire a contractor
directly by using a professional recruitment consultant to find 
employees  then their fees can range from 10% to 18% of the 
employee’s gross salary.  There may be additional costs like 
conducting a background check etc. If  you have hired contractors 
directly then you will need to pay them salaries  directly into their 
bank accounts. Banks will charge you a fixed transaction  fee per 
transfer.
If you use Remunance then we will charge you a fixed monthly 
fee per  employee. You make one single payment and we will 
disburse the salary  to each employee. You will receive a bill for 
their bank accounts. Each  bank account will have a SWIFT code 
with a clearly stated purpose for the  remittance. This will make it 
very easy to track and audit the payments  made to each remote 
employee. Remunance doesn’t charge you any  finder’s fee.
Hidden costs of remote teams
Remote workers pose a greater security threat
The solution is not to avoid the risk, but to mitigate it. It is very 
necessary  that you invest in VPNs. Your corporate network should 
be protected and  private. Remote team members should be able 
to log in remotely and  access the required tools without putting 
the business network at risk.
Remote workers are more susceptible to phishing and more likely to 
 use insecure devices
If remote team members use unsecured devices then they make 
the  business network vulnerable. If they’re using the same 
device for their  personal use and company use then they are 
putting your company  network at risk. It is best practice to use 
devices exclusively for work while  using separate and 
unconnected devices for personal use.
It is equally important to train and retrain your employees on 
security best  practices.
Different models to hire talent in India
Remote teams can be formed through routes like outsourcing, 
freelancing,  contracting, and subsidiary formation. You can 
choose your route  depending on your needs, the time you desire 
to continue business  operations in India, and the control you 
would like to have.
If you are looking for a long-term relationship with talented 
remote  resources, then an International PEO or EOR may just be 
the ideal option  for you. An International PEO will offer their 
expertise in handling the HR  department. This includes loading 
off administrative responsibilities like HR  management, payroll, 
and tax filing onto them. EOR services will step in  as the legal 
employer for your employees. The ideal takeaway for your  small 
and midsized business (SMB) employees is that a PEO will offer  
them the same benefits a larger company would do.
These are the different routes of remote hiring in India:
Partnering with an International PEO/EOR services
An International PEO works out great when you are on the lookout 
for a  better remote team selection, work allocation, deliverables, 
and cost. An  International PEO will ensure a business continuity 
plan, a dedicated team  in a full-time role, negligible upfront 
investments, and the opportunity to  have an entity at an 
opportune time. A PEO model will assure complete  protection of 
your projects, by adhering to all your company’s  confidentiality 
clauses and in a leak-proof secured infrastructure. A PEO  
International charges either straight costs or percentage costs. 
They will  charge you per employee per month or take a 
percentage of the  employee’s gross salary costs.
Click here if you would like to explore the benefits of using 
Remunance as  your India EOR.
2. Outsourcing model
Outsourcing has forever been a favorite and popular buzzword for 
global  companies seeking international talent, especially in the IT 
industry. Once  you have defined the project’s scope, you need 
not monitor their  deliverables as long as they are in line with 
your business expectations.
However, in an outsourcing route for hiring a remote team, you 
do not  have direct control over your resources. This will be the 
lookout for their  parent organization. It is difficult to find the right 
resources within a  stipulated time. You may lose your peace of 
mind when it comes to  confidentiality in an outsourcing setup. 
Your resources will work for you for  a finite period of time and on 
a particular project. You may have to shell out  more money from 
your pockets if you would like to retain them for a  full-time 
dedicated project. You may have to pay additionally for the added  
effort they put in other than their designated tasks. Such 
situations will be  out of your control.
3. Hiring and engaging contractors directly
In a contracting model of remote working, the resources will 
work for you  in a short-term or long-term project. The biggest 
drawback with contracting
is you will have little control in maximizing throughput in human 
resources.  Contractors can legally work for other clients or 
multiple companies  simultaneously. In such a scenario, their 
attention span and deliverables  will perhaps be compromised. 
They may work for your rival companies as  well.
From a cost perspective in a long run, maintaining a team of 
contractors  will turn out to be an expensive affair. They will 
charge on an hourly basis,  and if there’s additional scope of work 
loaded onto them, they will incur  additional costs for the same 
too.
This is relatively easy for the business when the number of 
international  contractors or remote workers is small, less than 
10. It gets complex,  cumbersome, and expensive quite quickly 
the moment you have more  than 10 remote (international) 
contractors. It is not easy for remote  (international) contractors 
who have to face multiple challenges like local  tech support, and 
filing complex end-of-year tax and GST returns.
The working culture and mindset of contractors are like near-
autonomy.  They like working independently and won’t go the 
extra mile to meet your  business expectations.
4. PEO versus subsidiary formation
Setting up your entity in India is the most traditional and the most 
obvious  method known to most business professionals. It gives 
you full control and  autonomy to (say) run the payroll, pay taxes 
and stay compliant with the  local laws. However, this pathway is 
very time-consuming and also  expensive. It needs a fair amount 
of country expertise in the local legal,  corporate, and payroll 
regulations. This method is usually used by larger  businesses 
that have the resources to manage the extra workload. We do  
not recommend this to SMEs and small businesses that have got 
no  immediate plans to hire a large number of employees.
To understand why to choose an International PEO before you 
form a legal  entity in India, read our blog PEO vs legal entity.
And to gather an even more comprehensive understanding of the 
process  of subsidiary formation, simply read this blog.
Build remote teams the Remunance way…
At Remunance, we understand a remote team acts as the 
backbone in  managing your global business. We also 
comprehend the importance of  building and retaining skilled 
resources. By becoming your ally, we provide  complete HR 
admin and office infrastructure support. We aim to inculcate  a 
winning team culture through our ideal selection process 
conducted by  our efficient team of HR professionals. We 
understand the Indian pulse,  are aware of the changing trends in 
the market and HR policies, and share  your employee 
responsibilities by finding the right fit accordingly.
Our EOR/International PEO services will handle your employee 
taxation,  salary processing, and employee benefits. We have a 
well-equipped  self-servicing employee portal. Our Founder, Mr. 
Rajendra Vaidya has  devised an innovative PEO model to offer 
you the best of both worlds.  Remunance has successfully served 
70 plus clients from 16 countries to  date.
To know more about our International PEO and EOR services, get 
in touch  with us here to nurture a collaborative business 
relationship.