What is statutory compliance in HR?

It is the part of HR and payroll work that makes sure the employer follows the laws on wages, payroll taxes, social security contributions, working hours, leave, safety and employment records, and files the registrations and returns those laws require, on time and in the correct form.

What is the difference between statutory and regulatory compliance?

Statutory compliance follows laws passed by a legislature. Regulatory compliance follows the rules, standards and guidance that regulators issue under those laws. HR teams handle both, because an act usually sets the duty and the rules made under it set the forms, rates and deadlines.

What Is Statutory Compliance?

Q: What are examples of statutory compliance for employers in India?

Examples include provident fund and employees' state insurance contributions where the business is covered, tax deducted at source on salaries, professional tax in states that levy it, minimum wages and timely wage payment under the Code on Wages, and registrations and returns under the four labour codes.

Definition

Statutory compliance in HR means meeting every obligation that employment, tax and social security laws place on an employer, such as paying at least the minimum wage, deducting and paying payroll taxes and contributions, keeping required records, filing returns and following rules on hours, leave and safety.

What statutory compliance in HR covers

Statutory means set by statute, an act passed by a legislature, as opposed to company policy or contract. In HR the obligations fall into a few groups: pay (minimum wage, timely payment, equal pay and lawful deductions), tax and social security (withholding income tax, pension or provident fund contributions, state insurance), working conditions (hours, overtime, leave, health and safety), employment rights (written terms, notice, protection from discrimination and harassment) and administration (registrations, registers, returns and inspections).

The detail differs by country and often by state or region, which is why employers with several locations keep a separate compliance calendar for each jurisdiction.

Compliance starts once someone is on the payroll. Before that, springhire's first-round candidate screening scores every applicant for a role against the same criteria.

Statutory compliance in India

India's four labour codes, the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020, took effect on 21 November 2025 and consolidate 29 earlier central labour laws. The government describes the change as moving to a single registration, a single licence and a single return in place of many separate filings. Labour is a subject for both the centre and the states, so check the rules your state has notified as well as the central rules.

Recurring obligations for Indian employers typically include provident fund and employees' state insurance contributions where the business is covered, tax deducted at source on salaries, professional tax in states that levy it, appointment letters, and wage, leave and attendance records.

How to manage statutory compliance

Start with an inventory: each law that applies at each location, what it requires, the due date and the person responsible. Turn it into a calendar of monthly, quarterly and annual deadlines. Build checks into payroll so contributions and deductions are calculated the same way every month, and keep evidence of every filing and payment. Review the inventory when headcount crosses a legal threshold, when you open a new location and when the law changes.

A simple measure is the on-time filing rate: filings made by the due date divided by filings due. If 48 of 50 filings in a year were on time, the rate is 96 per cent, and the two late ones show where the process needs work.

Common statutory compliance mistakes

Frequent problems are treating employees as contractors, calculating contributions on the wrong wage base, missing a registration when headcount crosses a threshold, relying on an informal offer where the law requires written terms, and settling exits late. Penalties, interest and back payments almost always cost more than the process that would have prevented them.