Through our Bangladesh EOR, we manage the following expansion and employment procedures on your behalf:
Employment contracts in Bangladesh
Written employment contracts are standard in Bangladesh. The terms of the contract are legally-binding between the parties and must comply with the provisions of the Labour Act. If there is no written employment agreement, employers must issue a letter of appointment.
Work week in Bangladesh
Labour laws restrict work hours to eight hours during a day and 48 hours per week. The usual days off are Friday and Saturday. Workers at industrial establishments, commercial establishments or shops must be given a resting period of 1.5 days each week.
Factory workers are entitled to one day of rest. Road transport service workers are entitled to a consecutive 24 hours per work week. Women cannot be required to work between 10 p.m. and 6 a.m. without their consent.
Overtime in Bangladesh
Adult workers in Bangladesh can work above 48 hours in a work week but not more than 60 hours in the week and not to exceed an average of 56 hours for the year. Overtime pay is twice the amount of the hourly base pay, in addition to a special allowance and interim or ad-hoc pay.
Annual leave in Bangladesh
Employees who have worked for an employer for at least one year are entitled to paid annual leave as follows:
- One day of leave for every 18 work days in industrial establishments, commercial establishments, factories, shops or road transport establishment
- One day of leave for every 22 days of work at a tea plantation
- One day of leave for every 11 days of work for newspaper workers
If an employee does not use all accrued overtime in a year, he or she can carry forward unused time, subject to the following limitations:
- Up to 40 days for factory or road transport workers
- Up to 60 days for shop, industrial, commercial or tea plantation workers
If the employee plans to take leave for a minimum of four days, he or she is generally entitled to be paid ahead of time for this leave.
Casual leave in Bangladesh
Workers are usually entitled to 10 days of paid casual leave each calendar year. This leave cannot be carried forward to subsequent years.
Additionally, most workers other than newspaper workers are entitled to 14 days of sick leave. Sick leave cannot be carried to subsequent years. Employees must present a medical certificate to receive sick leave.
Newspaper workers are entitled to sick leave at half-pay for a minimum of 1/18th of their employment period.
Expectant mothers who have worked for the employer for at least six months are eligible for maternity leave of eight weeks before delivery and eight weeks after it. Expectant mothers who have worked less than six months for the employer or have two or more surviving children are only eligible for unpaid leave.
Women are not allowed to work for eight weeks after giving birth to a child. There is no statutory paternity leave in Bangladesh.
Employees who have worked for the employer for a minimum of one year are entitled to two festival bonuses every year.
Large companies often provide employees with private health insurance. Group health insurance is based on the number of workers. In many industries, there may be a high required number of employees required before being able to procure group insurance.
Large companies may also provide additional benefits to employees, such as:
- Car facilities
- Subsidized meals
- Fringe benefits
Most companies in Bangladesh provide provident benefits to their permanent employees, which are usually derived from employer and employee contributions. They also usually provide gratuity benefits to permanent employees.
Employers are required to provide compensation to employees who sustain a work-related injury. Compensation depends on the age of the worker. An adult worker can receive up to TK.1,25,000 for complete permanent injury while a young worker may receive up to Tk.10,000.
Minimum Wage Country Comparison Chart
(Per month in USD)
Social security in Bangladesh
Employees in Bangladesh are not required to contribute towards a social security fund. Companies that meet specific criteria must pay 5% of their profits into a Workers Profit Participation Fund, which provides monetary benefits to employees. Owners, partners or directors who have been employed with the company for a minimum of nine months are not eligible to receive these benefits. Establishing a provident fund is not mandatory. Instead, it is based on the demand of a specific number of workers. There is no Social Security tax in Bangladesh.
The Bangladesh government does not sponsor any pension scheme.
Payroll taxes in Bangladesh
Payroll taxes are progressive from 10% to 30%, depending on the employee’s income.
Probationary periods in Bangladesh
Bangladesh allows probationary periods of six months for clerical workers and three months for other workers, which can be extended another three months if the employer could not determine the quality of work within the first three months.
Termination and notice procedures in Bangladesh
Employees who have worked for the employer for at least one year are generally entitled to 30 days notice for termination. The employer can opt to pay wages for this period instead of giving the notice.
Employees who are convicted of a crime or who are found guilty of misconduct are not entitled to receive this formal notice. Termination for other reasons than those listed above usually require written notice of 120 days for monthly-rated workers and 60 days for other workers. Again, this notice period can be made through compensation to the employee instead of providing notice.