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Bangladesh – Employer of Record

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Country Introduction

Capital – Dhaka
Currency – Bangladeshi Taka (BDT)
Population – 163 Million
GDP – $302.6 Billion
Language – Bengali
Major Religions – Islam / Hinduism

Bangladesh is a South Asian country located in the delta of the Padma and Jamuna rivers in the north-eastern part of the Indian subcontinent. The riverine country of Bangladesh (“Land of the Bengals”) is one of the most densely populated countries in the world, and its people are predominantly Muslim.

As the eastern portion of the historical region of Bengal, the area once formed, along with what is now the Indian state of West Bengal. With the partition of India in 1947, it became the Pakistani province of East Bengal, one of five provinces of Pakistan, separated from the other four by 1,100 miles (1,800 km) of Indian territory. In 1971 it became the independent country of Bangladesh, with its capital at Dhaka.

The Cox Bazaar in Bangladesh is the longest sea beach in the world, covering 125km. Bangladesh also has the world’s largest bay, the Bay of Bengal. The world’s largest mangrove forest is in Bangladesh.

With a total area of 10,000 km2, the UNESCO World Heritage Site of Sundarbans mangrove forest lies on the delta of the Ganges, Brahmaputra and Meghna rivers on the Bay of Bengal. The vast majority of Bangladesh’s exports (c.95%) come from textiles (knitwear and leather). Textiles account for over $37 billion of the country’s $39.2B total exports, even though 45% of the population is involved in farming.

According to the World Bank Bangladesh ranked 135th in the World in 2019 in terms of ease of doing business.

Contract of Employment

In Bangladesh there is a legal required to put a written employment contract in place, in Bengali. The contract must specify the terms of the employee’s salary and benefits along with termination requirements. The salary details must be provided in Taka (BDT) and not in a foreign currency.

Probation Period

Up to a maximum of 6 months.


Termination notice is generally 30 or 60 days of paid notice.

Payment in lieu of notice can be made by the employer.

Working Hours

Sunday to Thursday, 40 hours per week.


According to Section 108 of the Labour Act, all employees are entitled to work overtime. The rate for overtime is 2 times the basic salary rate. The maximum an employee is allowed to work during a week is 60 hours in total.

An employee is not allowed to exceed a yearly average of 56 hours per week.

Annual Leave

Every employee is entitled to annual leave after 12 months of service.

Annual leave is calculated as 1 day for every 18 working days. If an employee chooses not to use their leave it can be carried forward to the next year. Employees can choose to cash out their annual leave at the full pay rate.

Sick leave

Employees are entitled to 14 days of sick/medical leave at full pay and must submit a medical certificate as proof. Unused sick leave cannot be carried forward to the next year.

Maternity Leave

Female employees who have served a minimum of 6 months are entitled to 8 weeks of maternity leave before birth and 8 weeks after birth at full pay. Female employees who have served less than 6 months are entitled to unpaid leave. In all cases, women are not allowed to work for 8 weeks after giving birth.

There is no paternity leave.


15% is the standard VAT rate in Bangladesh.

Income Tax

Existing Tax Step Existing Tax rate
Up to Tk. 3 Lac. 0
On next Tk. 1 Lac. 5%
On next Tk. 3 Lac 10%
The next Tk. 4 lac 15%
The next Tk. 5 lac 20%
The rest of the money 25%

Non-residents are taxed at a flat 30%.

Tax rates may vary every year.

Employer/Employee Contributions

There are no mandatory employer or employee contributions for social security or pension.

Public Holidays

There are 11 public/festival holidays at full pay that employees are entitled to in Bangladesh. If an employee is required to work on a public holiday, they will be compensated with 2 full paid days of leave and a replacement holiday.

– New Year’s Day
– Language Martyrs’ Day
– Birthday of the father of the Nation, Bangabandhu Sheikh Mujibur Rahman
– Independence Day
– Bengali New Year
– May Day
– Buddha Purnima
– Jumatul Bidah
– Eid-ul-Fitr
– National Mourning Day
– Shuba Janmashtami
– Eid-ul-Adha
– Durga Puja
– Ashura
– Eid-e-Miladun-Nabi
– Victory Day
– Christmas Day

Severance Pay

Employees who have served at least 12 months of employment are entitled to 1 month paid notice or payment in lieu of notice, and 1 month of severance pay for every year served.

Festival Bonus

Employees are eligible for two festival bonuses after the completion of a continuous one-year service. Each bonus should not be more than the basic salary.

Work and Residence Permits (Expatriates)

All expat nationals require authorisation to work in Bangladesh. For long-term assignments, the expat national generally applies for an Employment (“E”) Visa and files a Work Permit application within 15​ days of arrival in Bangladesh. Once the work permit is granted, the E Visa can then be extended. A sub-category of the E Visa, the E1 Visa, is available to individuals visiting Bangladesh on short-term assignments that involve installation, maintenance, or ​supervisory​ work.​​

Employment (“E”) Visa is applied for online prior to travel. The applicant completes the online process then prints out the completed application form and visits the Bangladeshi embassy in their country with the following documents.

– A completed visa application form
– A letter of appointment from the employer in Bangladesh
– An original passport that is valid for a minimum of six months
– Passport sized photo
– Proof of payment of the visa fee, paid to the appropriate embassy
– The processing time for work visa is 3-4 weeks.

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