Employment · Template

Employment agreement (appointment letter) format for India

The offer letter is what gets someone to say yes. The employment agreement is what both of you are actually bound by for the next several years — and in most Indian SMBs it is either missing entirely, or it is a US template whose most confidently worded clause is void here.

Quick Statutory Answer

Is an appointment letter the same as an offer letter? No. The offer letter is the proposal, made before the person joins; the appointment letter is the contract that governs the employment itself. Many Indian employers try to do both in one document, and that works only if it carries the full terms and is signed by both sides — otherwise you have a proposal doing the work of a contract.

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Employment Agreement (Appointment Letter) format

The full text of this document as VidhiSar drafts it, with every blank shown in square brackets. Copy it or download it as a Word file and fill it in yourself — or answer a few questions and VidhiSar fills it in and prints a formatted PDF. Clauses that apply only in some cases are left out here; the drafting flow adds them when your answers call for them.

PARTIES

This Employment Agreement ("Agreement") is made on [Agreement Date] between:

[Company Legal Name], a legal entity registered in India, having its principal place of business at [Company Registered Address] ("Company"), of the one part;

AND

[Employee's Full Name], residing at [Employee's Residential Address], bearing PAN [Employee's PAN] ("Employee"), of the other part.

APPOINTMENT

The Company hereby appoints the Employee to the position of [Designation] in the [Department / Function] function, and the Employee accepts such appointment, on the terms set out below. The Employee shall report to [Reporting Manager] or such other person as the Company may designate.

TERMS AND CONDITIONS

1. Commencement and Place of Work. Employment commences on [Date of Joining]. The Employee's ordinary place of work shall be [Place of Work]. The Company may, on reasonable notice, require the Employee to work at any other location at which the Company carries on business.

2. Probation. The Employee shall serve a probationary period of [Probation Period] months from the date of joining. During probation, either party may terminate this Agreement by giving fifteen (15) days' written notice or salary in lieu thereof. Confirmation in writing at the end of probation is required; continued employment without written confirmation shall not by itself be treated as confirmation.

3. Remuneration. The Employee shall be paid a gross annual compensation of Rs. [Gross Annual Compensation], payable monthly in arrears, subject to deduction of tax at source under the Income-tax Act, 2025 and such other deductions as are required or authorised by law. Wages shall be paid within the time limits set by section 17 of the Code on Wages, 2019 and the Company's payroll cycle.

4. Statutory Benefits. The Employee shall be entitled to provident fund, employees' State insurance, gratuity, maternity benefit and such other statutory entitlements as are applicable to the Company and to the Employee's category of employment under the Code on Social Security, 2020, and to leave under the law in force from time to time. Where a statutory scheme is not presently applicable to the Company by reason of its employee strength or the Employee's wage level, the Company shall extend it upon becoming liable to do so.

5. Working Hours and Leave. Standard working hours shall be [Standard Working Hours], subject to the daily and weekly limits, overtime entitlements and leave provisions of the Shops and Establishments legislation of the State in which the Employee works. Leave entitlements shall be as set out in the Company's leave policy, which shall not be less favourable than the statutory minimum.

6. Duties and Exclusivity. The Employee shall devote their whole professional time and attention to the business of the Company during working hours and shall not, during the subsistence of this Agreement, engage in any other trade, business or employment for gain without the prior written consent of the Company. This restriction operates only during employment.

7. Confidentiality and Intellectual Property. The Employee shall keep confidential all information of the Company and its clients that is not in the public domain, both during and after employment. All work created by the Employee in the course of employment, and all intellectual property in it, shall vest in and be assigned to the Company. The Employee shall execute the Company's separate Confidentiality and Intellectual Property Assignment Agreement, which shall be read together with this Agreement.

8. Restrictive Covenants. The Employee shall not, during employment, solicit the Company's customers, employees or suppliers for a competing purpose. The parties record that under Section 27 of the Indian Contract Act, 1872 an agreement restraining a person from exercising a lawful profession, trade or business is void to that extent, and nothing in this Agreement is intended to restrain the Employee from taking up lawful employment after the termination of this Agreement.

9. Termination. After confirmation, either party may terminate this Agreement by giving [Notice Period After Confirmation] days' written notice, or payment of basic salary in lieu of the unexpired notice period. The Company may terminate without notice for proven misconduct, following an inquiry conducted in accordance with the principles of natural justice, and may suspend the Employee pending such inquiry.

10. Return of Property and Settlement. On cessation of employment for any reason, the Employee shall return all property, records, data and documents of the Company. The Company shall pay the wages due to the Employee within two working days of the cessation of employment, including on resignation, as section 17(2) of the Code on Wages, 2019 requires, shall pay gratuity, where payable, within thirty days of it becoming payable under the Code on Social Security, 2020, and shall complete full and final settlement of all other amounts lawfully due and issue a relieving letter and experience certificate without undue delay.

11. Governing Law and Jurisdiction. This Agreement shall be governed by the laws of India. Subject to any statutory forum available to the Employee under labour legislation, the courts at [Courts Having Jurisdiction] shall have jurisdiction. Nothing in this clause deprives the Employee of any remedy available before a labour authority or tribunal.

12. Entire Agreement. This Agreement, together with the Company's policies as amended from time to time, constitutes the entire understanding between the parties and supersedes all prior offers, letters and representations relating to the Employee's engagement.

EXECUTION

The parties have executed this Employment Agreement on the date first written above. The Employee confirms having read and understood every clause of this Agreement, and has received a signed copy.

Employment Agreement (Appointment Letter) format (India): page one of the document, with each blank to fill in shown in brackets

The provision behind this document

Section 7, Digital Personal Data Protection Act, 2023 — A closed list of uses that need no consent, one of which covers processing for the purposes of employment.

Section 7, Digital Personal Data Protection Act

Related statutory compliance tools & calculators

Gratuity Calculator India — Calculate statutory 15/26 gratuity under the Code on Social Security, 2020

Gratuity Calculator India

What this document must contain (Clause-by-Clause Matrix)

Employment Agreement (Appointment Letter) — Mandatory Clause Matrix & Statutory Protection (2026)
Essential Clause	Legal Purpose & Protection	Governing Law / Benchmark
Designation, reporting line and place of work	Without a stated place of work, a relocation you assumed was your right becomes a dispute. State the location and, if you need the flexibility, the circumstances in which it can change.	Indian Contract Act, 1872 — s. 27
Compensation, and the deductions applied to it	A single CTC number with no breakdown is an argument waiting to happen. State the gross, the payment cycle, and that tax and statutory deductions come off it.	Code on Social Security, 2020 — gratuity (s. 53)
Probation, and what confirmation actually requires	Say the length, the notice that applies during it, and that confirmation is in writing. Silence here means an employee who was never confirmed argues they were confirmed by conduct.	State Shops and Establishments legislation
Notice period both ways, and the basis for pay in lieu	If you intend to recover a notice shortfall at exit, the contract has to say whether it is calculated on basic or gross. Without that base, the recovery has no agreed arithmetic behind it.	The four labour codes
Statutory benefits, stated as applicable rather than promised absolutely	Provident fund, ESI, gratuity, leave and maternity benefit each have their own applicability tests. Promise them as applicable under the law in force, and undertake to extend them on becoming liable — do not name a scheme you are not covered by.	Indian Contract Act, 1872 — s. 27
Confidentiality and IP assignment, or an express cross-reference to a separate deed	Copyright in work made in the course of employment vests in the employer by statute; a patentable invention does not. A contract silent on inventions leaves you without the right to file.	Code on Social Security, 2020 — gratuity (s. 53)
Governing law and forum, without shutting the employee out of statutory remedies	Name the courts, but record that nothing in the clause removes a remedy available before a labour authority or tribunal. A clause that appears to do so is both unenforceable and revealing.	State Shops and Establishments legislation

Designation, reporting line and place of work — Without a stated place of work, a relocation you assumed was your right becomes a dispute. State the location and, if you need the flexibility, the circumstances in which it can change.
Compensation, and the deductions applied to it — A single CTC number with no breakdown is an argument waiting to happen. State the gross, the payment cycle, and that tax and statutory deductions come off it.
Probation, and what confirmation actually requires — Say the length, the notice that applies during it, and that confirmation is in writing. Silence here means an employee who was never confirmed argues they were confirmed by conduct.
Notice period both ways, and the basis for pay in lieu — If you intend to recover a notice shortfall at exit, the contract has to say whether it is calculated on basic or gross. Without that base, the recovery has no agreed arithmetic behind it.
Statutory benefits, stated as applicable rather than promised absolutely — Provident fund, ESI, gratuity, leave and maternity benefit each have their own applicability tests. Promise them as applicable under the law in force, and undertake to extend them on becoming liable — do not name a scheme you are not covered by.
Confidentiality and IP assignment, or an express cross-reference to a separate deed — Copyright in work made in the course of employment vests in the employer by statute; a patentable invention does not. A contract silent on inventions leaves you without the right to file.
Governing law and forum, without shutting the employee out of statutory remedies — Name the courts, but record that nothing in the clause removes a remedy available before a labour authority or tribunal. A clause that appears to do so is both unenforceable and revealing.

When you need this

When a candidate has accepted an offer and is joining — the appointment letter should issue on or before the first day
When confirming an employee at the end of probation, if the terms were never reduced to a full agreement
When an employee moves to a materially different role, location or compensation structure
When a client, investor or acquirer runs diligence and asks to see a signed contract for every person on the payroll
When you are about to rely on notice, confidentiality or IP terms that so far exist only in a conversation

The law that governs it

Indian Contract Act, 1872 — s. 27 — An agreement restraining anyone from exercising a lawful profession, trade or business is void to that extent. A post-employment non-compete is therefore generally unenforceable in India, however standard it looks in an imported template. Restrictions during employment, and confidentiality that survives it, rest on different and firmer ground.
Code on Social Security, 2020 — gratuity (s. 53) — Gratuity becomes payable to an employee who completes five years of continuous service, or one year on a fixed-term contract, at establishments with ten or more employees. The obligation arises from the statute, not from the contract — leaving it out of the appointment letter does not leave it out of your liabilities.
State Shops and Establishments legislation — Working hours, weekly off, leave entitlements and often the notice floor are set by the Act of the State where the employee works. A contract term less favourable than the statutory minimum does not displace it, and several States additionally require an appointment order to be issued and employment particulars to be maintained.
The four labour codes — The four labour codes took effect on 21 November 2025 and replaced twenty-nine central labour Acts, including those on wages, gratuity, bonus, provident fund, maternity benefit and industrial disputes. Some of the rules under them are still being notified by the States, so check the rules for the State where the employee works before relying on a specific figure.

Common mistakes

Issuing an offer letter and never following it with an agreement, so the binding terms of the relationship run to three paragraphs
Carrying a twelve-month post-employment non-compete over from a US form, where s. 27 voids it and its presence makes the clauses that would have worked look overreaching
Saying nothing about intellectual property on the assumption that everything an employee makes is automatically yours — true of copyright, not of a patentable invention
A notice period that binds only the employee, which reads in any later proceeding as evidence of an unequal bargain
Naming a distant city’s courts, which does not in fact prevent the employee approaching the labour authority where they work

Frequently asked questions

Is an appointment letter the same as an offer letter?

No. The offer letter is the proposal, made before the person joins; the appointment letter is the contract that governs the employment itself. Many Indian employers try to do both in one document, and that works only if it carries the full terms and is signed by both sides — otherwise you have a proposal doing the work of a contract.

Can I enforce a non-compete after the employee leaves?

Generally not. Section 27 of the Indian Contract Act, 1872 voids agreements in restraint of trade, and Indian courts have consistently declined to enforce post-employment non-competes. What does hold is confidentiality, the assignment of intellectual property, and non-solicitation obligations kept within reasonable bounds.

Do I need a written employment agreement if I have only a few employees?

The Contract Act does not require a contract to be in writing to be valid, but several State Shops and Establishments Acts require an appointment order to be issued and employment particulars to be kept. Evidentially it matters more than that: an unwritten term is a term you cannot prove when it is finally questioned.

What if my contract offers less leave than the law allows?

The statutory minimum applies and the contract term is unenforceable to that extent. You cannot contract below a statutory floor, and attempting it tends to attract attention to everything else in the document.

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Maintains the law explainers, calculators, templates and blog posts on vidhisar.in: checks them against the statute text and updates them when the law changes. Errors and changes in the law can be reported to legal@vidhisar.in.

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