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 M91 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 Yet, many companies hesitate to use EOR services because of outdated or incorrect assumptions.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

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 Momentum91  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. M91 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, M91 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. M91 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 M91, 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 M91 as a long-term solution. Unless you plan to build a large India-based team and need a local entity, M91 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. M91 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. M91 handles the red tape, so you don’t have to.

Myth #6: You Lose Control of Your Indian Employees

With M91, 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

M91 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. M91 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. M91 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, M91 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. M91 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 M91 simplify it.

Hire Confidently in India with M91

India offers world-class talent and cost-effective hiring but only if you do it right. With M91, you get a trusted Indian partner that handles everything from contracts and payroll to legal compliance and benefits administration.

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