Minimum wage compliance is a critical element of remote hiring, especially for companies employing talent from cost-effective economies like India. Understanding the “India minimum wage in USD” allows global companies to make fair compensation decisions, avoid legal pitfalls, and maintain transparency in payroll. This 2025 guide explains how minimum wages are structured, calculated, regulated, and converted into USD for better budgeting and compliance.
Table of Contents
- What Is Minimum Wage in India?
- Current Minimum Wage in India (2025)
- How Is the Minimum Wage Calculated in India?
- How Is the Minimum Wage Regulated?
- Why India Has No National Minimum Wage
- Factors Affecting Minimum Wage in India
- Why USD Conversion of Indian Minimum Wage Matters
- How to Convert INR to USD Accurately
- How to Understand Labor Costs in India
- Minimum Wage Compliance for Global Companies
- Where Can You Find Official Minimum Wage Updates and Notifications?
- How Can Asanify Help?
- Key Takeaways for Global Employers
- FAQs
What Is Minimum Wage in India?
Minimum wage in India is a critical legal safeguard aimed at ensuring fair compensation for labor across various sectors of the economy. It is not just a monetary figure but a tool of social justice that helps bridge income inequality, protect vulnerable workers, and guarantee a minimum standard of living. For global companies hiring in India—either directly or through Employer of Record (EOR) models—understanding the scope, purpose, and regulatory framework of minimum wages is vital for staying compliant with Indian labor laws.
Definition and Purpose
The minimum wage in India refers to the legally defined lowest remuneration that an employer is obligated to pay an employee for the services rendered during a specified time frame—whether hourly, daily, or monthly. This wage is not arbitrary; it is based on several living-cost metrics including nutritional food intake (2,700 calories/day), housing rent, clothing requirements, education, healthcare, and transportation.
The purpose of this wage framework is to protect low-income workers—particularly those in the informal and unskilled labor markets—from exploitation. It provides them with the ability to lead a life of dignity and helps support their families. Over time, it also contributes to improved workforce morale, lower attrition, and enhanced productivity.
Who Sets Minimum Wage in India?
India’s minimum wage system is dual-layered, meaning it is governed by both the Central Government and the individual State Governments, under the legal framework of the Minimum Wages Act, 1948 and the Code on Wages, 2019.
- The Central Government sets minimum wages for scheduled employments that fall under its jurisdiction, such as railways, oilfields, mines, and major ports.
- The State Governments define wage rates for all other sectors, including agriculture, construction, textiles, and hospitality, based on local economic conditions.
Each state classifies wages based on:
- Skill level (unskilled, semi-skilled, skilled, highly skilled),
- Geographical zone (urban vs rural),
- Industry type, and
- Nature of work (clerical, technical, manual labor, etc.).
This decentralized approach ensures that minimum wage standards reflect local costs of living and labor market conditions, although it also results in significant variation across different regions and job categories.
Current Minimum Wage in India (2025)
India’s minimum wage structure is diverse and multi-layered, shaped by regional, industrial, and legal variations. Unlike many countries that enforce a single, nationwide minimum wage, India adopts a federal and state-led approach, allowing each state to determine its wage rates based on local conditions, cost of living, and economic activity.
For global employers hiring remotely in India, it is important to understand both the central floor wage guidelines and the state-specific mandates, as wages can differ dramatically from one region to another and across skill levels.
National Floor Wage vs State Minimum Wages
India does not implement a uniform national minimum wage. Instead, the Ministry of Labour & Employment proposes a non-binding national floor wage, which serves as a reference point for state governments. As of 2025, this floor wage stands at INR 178 per day, a rate that has remained unchanged for several years. While the floor wage reflects the minimum acceptable income at a national level, it is not enforceable by law and states are free to notify higher wages.
In practice, most Indian states set their own minimum wage levels—often well above the national floor. These state-determined wages are enforceable and vary according to job type, region (urban or rural), and worker skill classification (unskilled, semi-skilled, skilled).
Minimum Wage Range in INR by State
As of 2025, the daily minimum wage across Indian states shows significant variation, influenced by economic factors, urbanization, and industrial development.
Here’s a quick snapshot of state-wise daily minimum wages:
- Bihar: INR 178/day (aligned with the national floor wage for unskilled workers)
- Maharashtra: INR 350–600/day depending on region and occupation
- Delhi: INR 600–700/day for unskilled to skilled workers, among the highest in the country
- Karnataka: INR 350–550/day, varying by zone and worker classification
These numbers may increase in urban/metropolitan zones where costs of living are higher and labor demand is more intense. Additionally, wages are segmented by industry category—for example, construction workers, security guards, garment workers, and IT support staff may all have different applicable wage slabs within the same state.
Converted Minimum Wage in USD
To help global companies estimate labor costs and benchmark remote hiring budgets, here’s how Indian minimum wages translate to US Dollars, based on the average 2025 exchange rate of USD 1 = INR 83.5:
- INR 178/day = ~$2.13 USD/day
- INR 350/day = ~$4.19 USD/day
- INR 600/day = ~$7.19 USD/day
- INR 700/day = ~$8.38 USD/day
Considering a standard 26 working days per month, the monthly wage range in USD is approximately:
- Low-end (Bihar): $2.13 × 26 = ~$55/month
- Mid-range (Maharashtra/Karnataka): $4.19–$6.58 × 26 = ~$109–$171/month
- High-end (Delhi): $7.19–$8.38 × 26 = ~$187–$215/month
These figures highlight India’s cost-effectiveness as a talent destination, especially for global teams hiring remotely. However, companies must remain aware of local legal wage thresholds and not rely solely on USD equivalents when structuring compensation.
How is the Minimum Wage Calculated in India?
Factors Considered
The wage is calculated based on a normative family unit, accounting for:
- 2700 calories per adult per day
- Clothing needs of 66 meters/year per family
- Rent equivalent to 10% of food and clothing costs
- 25% of the total for education, health, fuel, and miscellaneous expenses
Skill-Level and Zone Classification
Jobs are classified into unskilled, semi-skilled, skilled, and highly skilled. Geographical zoning (Zone I for metros, Zone II for tier-2 cities, Zone III for rural) further refines the wage scale.
How is the Minimum Wage Regulated?
Minimum wage regulation in India is rooted in a well-defined legal framework that governs how wages are fixed, updated, and enforced across the country. While India does not have a unified national wage system, the regulation of minimum wages is systematically managed by both central legislation and state-level labor departments, ensuring fair pay practices across industries and regions.
This regulatory setup is especially important for global companies hiring Indian talent, as non-compliance with wage laws can lead to penalties, labor disputes, and reputational risk.
The Minimum Wages Act and Labour Codes
Historically, the Minimum Wages Act of 1948 laid the foundation for wage protection in India. It empowered both the Central and State Governments to fix and periodically revise wage rates for workers employed in scheduled employments, such as manufacturing, agriculture, and service sectors.
In 2019, this Act was subsumed under the Code on Wages, 2019, one of four major labor codes introduced to streamline and modernize India’s complex labor laws. The Code on Wages consolidates four key laws:
- The Minimum Wages Act, 1948
- The Payment of Wages Act, 1936
- The Payment of Bonus Act, 1965
- The Equal Remuneration Act, 1976
The Code on Wages aims to standardize the definition of wages, ensure equitable remuneration across genders and job roles, and empower both central and state governments to notify and enforce minimum wages across all employment types—not just scheduled industries.
This code provides the legal authority for wage determination, grievance redressal, and penal action in case of non-compliance.
Role of State and Central Labour Departments
Both the Central Government and State Labour Departments play an active role in regulating minimum wages through policy formulation, periodic notifications, and enforcement:
- State Governments hold the responsibility of fixing and revising minimum wages for the majority of sectors, especially in local industries and informal employment segments.
- Labour Departments of each state release notifications—typically bi-annually (every 6 months)—to announce updated wage rates based on inflation, skill level, and regional cost-of-living variations.
- Employers are legally obligated to comply with the latest wage notifications and must publicly display minimum wage boards at their workplaces.
- Labour inspectors may conduct audits or site visits to verify that minimum wages are being paid and statutory records (like muster rolls and wage registers) are maintained.
In the case of central sector industries (e.g. mining, railways, ports), the Central Labour Department issues minimum wage directives applicable nationwide.
In summary, the regulatory process is decentralized but enforced stringently, and every employer—local or foreign—is expected to remain compliant to avoid fines, worker disputes, and possible litigation.
Why India Has No National Minimum Wage
India’s wage landscape is as diverse as its geography, economy, and labor force. While many countries enforce a single, national minimum wage across all sectors and regions, India takes a decentralized approach, allowing individual states to define wage thresholds tailored to their local realities.
Diverse Economic Conditions
India’s 28 states and 8 union territories differ vastly in economic development, cost of living, industrial strength, and labor supply-demand dynamics. A flat national minimum wage may work in a uniform economy, but in India, it risks being too high for underdeveloped states—hurting small businesses and job creation—or too low for metro cities, leaving workers underpaid.
For instance, ₹178/day may be acceptable in rural Bihar, but completely inadequate in urban Delhi or Mumbai where rent, food, and transportation costs are significantly higher. Hence, state-specific wage setting ensures contextual fairness and economic feasibility.
Legislative Limitations
Although the Ministry of Labour & Employment recommends a “national floor wage”, this figure is advisory and non-binding. The floor wage currently stands at ₹178 per day, but states are free to fix and enforce their own minimum wages under the Minimum Wages Act, 1948 and the Code on Wages, 2019.
This legal flexibility grants autonomy to state governments to protect their workforce while balancing the needs of local businesses and industry. However, it also leads to wage disparity and complexity for foreign employers, who must navigate varied wage rules across different hiring locations in India.
Suggested Read: EOR India: A Detailed Guide on Employer of Record 2025
Factors Affecting Minimum Wage in India
Indian minimum wages are not one-size-fits-all—they are calculated based on a variety of contextual factors, all of which influence the final wage rate an employer must pay. Understanding these parameters is crucial for global companies planning to hire in compliance with local laws.
Skill Level (Unskilled, Semi-skilled, Skilled)
One of the most important determinants of minimum wage is skill classification. Workers are grouped into:
- Unskilled: Roles requiring minimal training or formal education (e.g., helpers, loaders)
- Semi-skilled: Jobs needing some training or mechanical knowledge (e.g., machine operators)
- Skilled: Positions demanding technical knowledge or formal experience (e.g., electricians, IT support)
- Highly Skilled: Managerial, technical, or supervisory roles (e.g., engineers, team leads)
Each category commands a progressively higher wage, based on the complexity, responsibility, and productivity expected from the employee.
Location (Urban vs Rural)
Minimum wages are further divided into urban and rural zones, and often into Zone A, B, and C based on metropolitan status. Urban workers typically earn more than rural workers due to:
- Higher living expenses (rent, transport, food)
- Greater economic activity and demand for labor
- Government cost-of-living indexes applied during wage calculations
For example, the minimum wage in Delhi or Mumbai can be double that of small towns in Odisha or Jharkhand, even for similar roles.
Industry and Sector-Specific Wages
Certain industries are notified separately with customized wage slabs. These include:
- Construction
- Textile and Garment Manufacturing
- Mining and Quarrying
- Hospitality (Hotels, Restaurants)
- Agriculture
- Security and Sanitation
State labor departments issue industry-specific wage notifications, sometimes even breaking them down by role (e.g., mason, plumber, tailor, housekeeping staff), ensuring that workers receive fair compensation relative to the nature of their work and sectoral standards.
Why USD Conversion of Indian Minimum Wage Matters
For global employers and HR leaders hiring remote talent in India, knowing the minimum wage in USD terms is essential for structuring fair and compliant compensation. It’s not just a currency conversion—it’s a strategic exercise that affects hiring competitiveness, payroll transparency, and budget efficiency.
For Global Hiring and Remote Teams
If you’re hiring Indian professionals for remote roles—be it in customer support, software development, marketing, or finance—benchmarking their wages in USD terms ensures that:
- Compensation aligns with local legal requirements
- Salaries remain competitive in the Indian market
- International team parity and transparency are maintained
This is especially important for small startups or distributed teams expanding globally without a local legal presence.
For Employer of Record (EOR) or Outsourcing Services
When partnering with an Employer of Record (EOR), wage compliance and currency conversion are handled as part of payroll management. However, it’s essential to understand that:
- The EOR must ensure the local minimum wage (in INR) is met
- Payslips often display both INR and converted USD-equivalent salaries to provide clarity to both employer and employee
- Accurate USD benchmarking helps clients understand total cost of employment
This prevents wage discrepancies, miscommunication, and legal risks in cross-border contracts
For Budgeting and Payroll Forecasting
For finance and HR teams involved in workforce planning or headcount expansion, having a clear USD view of Indian labor costs is crucial. Converting local minimum wages helps:
- Compare labor costs across geographies
- Identify savings opportunities through remote hiring
- Forecast expenses in a consistent currency
- Build transparent compensation models for global teams
Even for mid-sized teams, a difference of $50–$100 per employee per month can result in substantial long-term cost impact.
How to Convert INR to USD Accurately
When managing international payrolls or budgeting for global teams, accurately converting Indian Rupees (INR) to U.S. Dollars (USD) is essential. Exchange rate miscalculations can lead to payroll discrepancies, compliance risks, and confusion for both employers and employees—especially when compensation is being reviewed in a global context.
For companies hiring in India, whether directly or via an Employer of Record (EOR), it’s important to follow standardized conversion practices to ensure consistency, accuracy, and financial transparency.
Exchange Rate Fluctuations
The INR–USD exchange rate is subject to daily fluctuations based on global currency markets, inflation, interest rates, and geopolitical factors. These variations can significantly impact salary estimates when converting Indian wages to USD—especially over longer pay cycles or for larger teams.
For example, an INR 600/day wage may equal $7.19 today, but if the exchange rate changes from 83.5 to 85, the value drops to $7.05, impacting payroll projections and cost estimates.
To avoid surprises:
- Use real-time APIs from trusted financial platforms.
- Factor in buffer margins when forecasting.
- Reconcile actual vs. forecasted rates monthly to keep payroll aligned.
Use of Daily or Monthly Averages
While spot rates may seem precise, they are not ideal for payroll or budgeting purposes due to their volatility. Instead, most international payroll professionals recommend using:
- 30-day trailing averages: Helps smooth out anomalies and reflect a stable rate.
- Monthly government rates: Often used for compliance or reporting.
- Quarterly averages: Suitable for long-term financial planning or contract pricing.
Using average rates ensures that your wage-to-USD conversions remain consistent, predictable, and easier to audit, especially when dealing with multiple employees across departments or locations.
Tools and Resources for Conversion
Several trusted platforms and tools can help you convert INR to USD accurately and in real time. These include:
- XE.com – Offers live mid-market exchange rates and historical averages.
- OANDA – Popular for currency APIs, historical data, and integration into finance software.
- RBI’s Forex Rates – The Reserve Bank of India publishes daily reference rates for USD and other major currencies.
- Asanify – An Employer of Record and global payroll platform that automatically converts wages from INR to USD using reliable FX sources and applies consistent rates to your payroll calculations.
These tools ensure your payroll systems, client invoices, or cost reports reflect real-world values, and they help avoid underpayment or overpayment due to currency volatility.
How to Understand Labor Costs in India
For global companies hiring in India, understanding labor costs beyond just the minimum wage is essential for accurate financial planning, fair compensation, and legal compliance. While India is known for its cost-effectiveness as a hiring destination, true labor costs can vary widely depending on location, role, and regulatory overheads.
Total Cost to Company (CTC)
The Total Cost to Company (CTC) includes not just the base salary or minimum wage but also statutory and optional components. These hidden or overlooked costs can account for 15–30% above the base wage. Key CTC elements include:
- Provident Fund (PF): Employers contribute 12% of the basic salary toward PF, which is a retirement benefit.
- Gratuity: Payable after 5 years of service, calculated as 15 days’ wages for every completed year.
- Bonus: Under the Payment of Bonus Act, 1965, eligible employees earning up to ₹21,000/month receive 8.33% to 20% of their annual salary as a bonus.
- Professional Tax: Levied by certain state governments; varies by salary brackets and location.
- Leave Encashment, Medical Insurance, and Perks: These may not be mandatory but are expected in market-standard compensation packages.
So while the legal minimum wage ensures compliance, the actual cost of employing someone is higher, especially for full-time skilled roles with benefits.
Minimum Wage vs Market Salary
While minimum wages are enforced by law, market salaries for skilled positions often far exceed these thresholds. For example:
- A minimum wage for a skilled worker in Delhi might be ₹18,000/month ($215), but a software developer with 3+ years of experience in the same city could command ₹70,000–₹120,000/month ($835–$1,430).
Global employers must understand that minimum wage is the legal floor, not the hiring benchmark. To attract and retain talent, you’ll need to offer competitive salaries aligned with market expectations.
Regional Differences in Cost Structures
Labor costs can vary drastically between regions in India. Hiring in Tier 1 cities like Mumbai, Bengaluru, or Delhi often comes with:
- 15–20% higher salary expectations
- Increased cost of living allowances
- Stronger competition for talent
In contrast, Tier 2 cities like Indore, Pune, or Coimbatore offer:
- Access to qualified talent at more affordable wage levels
- Lower operational costs
- Greater employee retention due to reduced attrition
Global companies can optimize payroll by tapping into emerging cities while maintaining compliance and quality.
Minimum Wage Compliance for Global Companies
If you’re hiring in India—whether through direct employment, freelancing platforms, or EORs—compliance with Indian minimum wage laws is non-negotiable. Violations can result in legal consequences and reputational damage, even for overseas employers.
Indian Labour Law Requirements
All employers operating in India, including foreign companies hiring remote talent, are required to:
- Pay at least the state-notified minimum wage
- Issue payslips and maintain wage registers
- Deduct and deposit statutory contributions such as PF, ESI (where applicable), and professional tax
- File returns and reports with labor departments as mandated
Non-compliance can attract:
- Penalties and fines
- Legal notices and audits
- Blacklisting by labor enforcement authorities, especially in states with strict inspection regimes
How EOR Services Help with Compliance
Partnering with an Employer of Record (EOR) like Asanify is one of the easiest ways for global companies to remain compliant without setting up a local legal entity. EORs manage end-to-end HR and payroll obligations, including:
- Worker classification (contractor vs full-time)
- Payroll computation with state-specific wage rules
- Timely disbursal of wages and statutory contributions
- Generation of payslips and tax deduction certificates
- Government filings and labor inspections, if needed
This minimizes legal risk and gives international employers peace of mind.
Documenting Wages and Pay Slips
Under Indian labor laws, employers must issue itemized payslips to every employee, detailing:
- Basic wage
- Allowances
- Deductions (e.g., PF, tax)
- Net take-home pay
Additionally, wage records must be maintained for inspections and audits. For global teams, especially those paying in foreign currency equivalents, record-keeping and digital documentation become even more critical for transparency.
Where Can You Find Official Minimum Wage Updates and Notifications?
Staying updated on wage notifications is essential for ongoing compliance. Here are the primary sources to monitor:
State Government Labour Portals
Each Indian state maintains an official labour department website, where you can access:
- Latest minimum wage orders
- Skill classification tables
- Wage updates by industry and job role
- Circulars on inflation-linked revisions (Variable Dearness Allowance or VDA)
Employers are encouraged to check these portals every quarter or subscribe to updates to stay informed.
Ministry of Labour & Employment (India)
The central government portal at labour.gov.in offers:
- Details on the Code on Wages, 2019
- National floor wage notifications
- Central sector wage updates
- Employer compliance guides and circulars
This site is a useful resource for understanding nationwide labor policies and federal-level employment guidelines.
EOR and HR Compliance Platforms
Modern HR platforms and EOR services like Asanify offer built-in compliance tracking by:
- Automatically updating wage databases when government notifications are published
- Mapping pay rates based on location, job role, and skill level
- Issuing alerts when your payroll or offer letters fall below legal thresholds
These tools reduce manual monitoring and ensure that your wage structures remain legally compliant and audit-ready.
State-Wise Minimum Wage to USD Table (2025)
| State | INR/Day | INR/Month | USD/Day | USD/Month |
| Bihar | 178 | 4628 | $2.13 | $55.42 |
| Karnataka | 400 | 10400 | $4.79 | $124.55 |
| Maharashtra | 550 | 14300 | $6.59 | $171.02 |
| Delhi | 700 | 18200 | $8.38 | $217.36 |
Conversion Rate Used: 1 USD = INR 83.5 (2025)
How Can Asanify Help?
Hiring in India offers access to highly skilled, cost-effective talent—but it also comes with complex wage structures, multi-state compliance rules, and legal responsibilities that can be challenging for global employers. That’s where Asanify steps in as your trusted Employer of Record (EOR) and HR compliance partner.
Whether you’re scaling your remote team, building a distributed workforce, or entering the Indian market without a local entity, Asanify offers a fully managed EOR solution to help you hire faster, stay compliant, and pay your Indian employees with confidence.
End-to-End EOR Compliance
Asanify enables companies across the world to hire Indian employees without incorporating a local business entity. Through our EOR framework, we legally employ workers on your behalf while ensuring:
- 100% compliance with minimum wage laws across all Indian states
- Adherence to statutory norms under the Code on Wages, 2019
- Proper worker classification (full-time vs contractor)
- End-to-end labor law documentation, including payslips, offer letters, and employment contracts
With Asanify, global employers can focus on business growth while we handle all back-end compliance and risk mitigation.
Automated Payroll and FX Conversion
Asanify’s platform integrates with real-time currency exchange feeds to convert INR salaries into USD (or your local currency) for transparent reporting. We offer:
- Automated INR-to-USD conversion for payroll planning and invoicing
- Payroll processing across different states with state-specific wage rules
- Auto-filing of statutory dues like Provident Fund, ESIC, TDS, and professional tax
- Monthly payslips and compliance summaries delivered digitally
This simplifies financial reporting for your global finance teams while ensuring your employees are paid accurately and on time.
Transparent Hiring and Onboarding
Asanify supports the entire employee lifecycle for Indian hires, from offer letter to full exit management. Our platform provides:
- Digitally signed contracts aligned with Indian labor laws
- Skill-based wage classification based on state guidelines
- Customizable onboarding workflows, ID verification, and bank account setup
- Access to a centralized dashboard for complete visibility into every remote employee’s status, salary, and compliance reports
This means you maintain full control and visibility over your Indian workforce without worrying about local legal complexities.
Suggested Read: Hire Employees in India Through EOR – Your Go-to Guide
Key Takeaways for Global Employers
- India does not have a uniform minimum wage—rates vary significantly by state, city zone, industry, and skill level.
- Converting INR to USD is essential for global budgeting, payroll benchmarking, and transparent compensation planning.
- Non-compliance with Indian wage laws can result in financial penalties, employee disputes, and reputational risks.
- Partnering with a trusted Employer of Record like Asanify can help you scale your team in India faster, with full confidence in legal compliance, payroll accuracy, and seamless operations.
FAQs
It ranges from $2.13 to $4.50 per day, depending on the state and exchange rate.
Economic diversity across states makes a uniform national wage impractical and legally non-binding.
Typically revised twice a year, though frequency varies by state and sector.
Yes, Indian labor laws apply even for remote workers hired through EORs or outsourcing.
State labor department websites and the Ministry of Labour & Employment portal publish updates.
It’s converted using the current INR–USD exchange rate, often based on daily or monthly averages.
Minimum wage is a legal floor, while market salaries are often much higher for skilled roles.
Yes, wages are categorized for unskilled, semi-skilled, skilled, and highly skilled workers.
Yes, non-compliance may result in fines, legal action, and payment of arrears to employees.
An EOR ensures correct wage classification, compliance with labor laws, and automated payroll processing.
Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant or Labour Law expert for specific guidance.
