Employer Of Record In Bangladesh

As a global HR platform, we can help you expand your business in Bangladesh by offering an alternative to Employer of Record (EOR) services. Without the necessity for a local organisation, you may work with us to employ and manage a team locally in Bangladesh. We offer a variety of HR-related services, including administering payroll in accordance with local rules and regulations.

Working with us allows you to delegate HR-related responsibilities to us while concentrating on your main lines of business. Our platform was created to assist businesses in growing worldwide and it has a huge network of professionals that can assist you in navigating the challenges of conducting business abroad.

Overall, businesses seeking to expand into Bangladesh and other international markets will find our HR platform to be a fantastic substitute. With their all-inclusive HR solutions, you may grow your company operations in Bangladesh while speeding up the hiring process and guaranteeing compliance with local laws and regulations.

Overview of Bangladesh

• Population: 164.7 Million.
• Currency: Bangladeshi Taka (BDT)
• Capital city: Dhaka 
• Languages spoken: Bengali
• GDP: 8.2% (2020)

Employment Landscape of Bangladesh

The 2006 Labor Act and the 2015 Labor Rules Control govern Bangladesh’s labour legislation. These rules, which specify working hours, weekly holidays, medical leaves of absence, and yearly leaves, are applicable to all employees who work for commercial and industrial businesses.

It may be difficult and expensive for businesses intending to expand into Bangladesh to set up a local company structure. Employers must also be aware of the nation’s labour laws and regulations, which may be intricate and call for a thorough comprehension of regional customs.

To preserve employee rights and provide a just and safe workplace, compliance with labour laws and regulations is essential. Employers may develop a good image in the nation and a devoted and effective workforce by showing a dedication to these rules and regulations.

Privileges	Explanation
Working Hours	Eight hours per day for a maximum of 48 hours in a week.
Overtime Eligibility	According to Section 108 of the Labor Act, all employees are eligible for overtime compensation, which is fixed at twice the rate of the base wage and may be worked up to 12 hours per week or two hours per day.
Paid Public Holidays	New Year’s Day (1st January) Language Martyrs’ Day (21st February) Sheikh Mujibur Rahman’s birthday (March 17th) Independence Day (26th March) Bengali New Year (14th April) May Day (1st May) Jumaltah Bidah (7th May) Eid ul Fitr (13th to 15th May) Buddha Purnima (26th May) Eid-ul-Azha (20th to 22nd July) National Mourning Day (15th August) Ashura (19th August) Janmashtami (30th August) Durga Puja (15th October) Milad un Nabi (19th October) Victory Day (16th December) Christmas Day (25th December)
Holiday Pay	All employees are allowed full holiday pay on 11 festival holidays. An employee will receive two additional holidays with full pay and an alternate day off if they want or are obliged to work on a festival holiday.
Medical leave	All workers have the right to request a minimum of 14 days of paid time off for medical reasons, providing they show a medical certificate.
Maternity Leave	Eight weeks of permitted paid leave can be used by female employees who have been with the firm for at least six months before and after the birth of their child. Women who haven’t had a job for six months typically qualify for unpaid leave. The eight weeks following the birth of their kid are also spent with them being prohibited from working.
Annual Leave Accrual Entitlement	After serving a full year at an employer, every employee has the right to request annual leave. One day of leave is calculated for every 18 working days of work.
Leave Expiry	Employees have the option of cashing out their accumulated paid yearly leave.
Leave Cash Out	Employees have the option of cashing out their accumulated paid yearly leave.
Accrued Leave at Termination	Employees may be paid in full for earned annual leave if they carry over their unused time to the next year. Employees are thus entitled to receive paid for their accumulated annual leave at the conclusion of the calendar year without any deductions or adjustments to the payout amount.
Employee Protection and Anti-discrimination Rights	All significant implemented rules and regulations for the protection of workers’ rights are dictated by Bangladesh’s labour laws and rules. Since everyone in Bangladesh is guaranteed equality under the constitution, discrimination based on caste, class, or religion is prohibited. According to the labour code, any youngster under the age of 14 is not permitted to work in a factory. Additionally, it allows for 30-minute breaks for shifts of five hours and six hours, respectively.
Confidentiality of Personal Information	There is no legislation requiring the employer to safeguard an employee’s personal information. However, everyone has the right to communication privacy under Article 43(B) of the Constitution. Under certain circumstances, including the following, the government may be able to restrict data under the recently passed Technology Act. Security of the state Relationships with foreign states For investigations

Contractors vs. Full-Time Employees

Workers in Bangladesh who work under various contracts and agreements are referred to as contractors. While full-time employees follow orders from their employer and receive a variety of employment benefits from their company, contract workers are in charge of managing their own work and paying their own taxes.

It is critical to take the project’s scope and length into account while choosing between full-time staff and contractors. It is often preferable to hire full-time employees for important jobs that require tight supervision, such as accounting and marketing. On the other hand, short-term tasks that call for specialised knowledge or abilities may be better suited for contractors.

Since contractors are more adaptable and their work is governed by their contracts, hiring them can be a cost-effective choice. Employers may, however, have less influence over the contractor’s work schedule and output. Since they work with various clients, contract employees are free to set their own work schedules and might be less loyal to a single employer. In addition, contractors are less likely to sue their employer because their job is just temporary.

Recruitment in Bangladesh

To be in accordance with Bangladeshi labour laws, employers must create an employment contract that details every element of the employee’s wages, benefits, and compensation. Bangladeshi Taka must be used in the contract since other currencies cannot be accepted.

The hiring process in Bangladesh may alter based on the needs and objectives of the firm. Contractual and fixed-term employees are both options for employers, and each has a certain set of requirements that must be specified in the employment agreements.

Our company offers an Employer of Record (EOR) solution that expedites the hiring process for all classes of employees in Bangladesh. By working with our team of experts, employers can be sure that their employment contracts contain all necessary terms, perks, and additional incentives while still being in accordance with regional laws. Businesses may focus on their core operations with the aid of this solution while leaving HR management in the expert hands of our personnel.

Probation & Termination

Probationary period

According to Bangladesh’s Labor Act, Section 4(8), the duration of an employee’s probationary period is determined by their line of employment. The standard probationary time for employees in administrative duties is six months, whereas the standard probationary period for employees in other areas is three months.

The probationary term may be prolonged if an employee’s performance during that time is subpar. The individual is eligible for permanent employment with the company when the probationary term has ended.

In order to stay out of trouble with the law and provide their workers with a fair and equitable workplace, companies must follow these regulations. To help firms avoid fines and legal issues, our business can help make sure that hiring methods adhere to regional laws and regulations.

Termination of Contract

Both the employer and the employee have the option to end the employment contract under the Labor Act of 2006. According to the Act, there are five possible ways to end a job: termination with notice, dismissal, discharge, layoff, and retrenchment.

If an employer chooses to let an employee go, they must give them a notice period of 120 days for those who are paid on a monthly basis and 60 days for everyone else. Upon termination, the employee is entitled to one month’s compensation for each year of service.

To guarantee a just and lawful termination process, businesses must adhere to the correct processes established in the Labor Act.

EOR Solution

It might be challenging to expand your company into Bangladesh, but with the aid of an Employer of Record (EOR), the procedure can be simplified and effective. An EOR can handle crucial HR duties including organizing employee pay, contracts, taxes, and work permits so you may concentrate on expanding your company.

We have a comprehensive awareness of the neighborhood market and can give you access to a pool of highly qualified applicants that suit your company’s requirements. With the help of our EOR solution, CEOs and company owners may build a local presence in Bangladesh without having to create a formal corporation or understand the intricacies of the country’s labor regulations.

Standard EOR Service Agreement

Taxes that apply to invoices	Any business entity conducting operations in Bangladesh is required to pay a Goods and Services Tax (GST) of 15% to the government.
Minimum duration of service	The minimal term of employment is three months for other occupations and six months for administrative ones.
Currency Accepted	Bangladeshi Taka (BDT)
Required Details & Documents	Important personal information, passport copy, bank-related details, NIC card, and a TIN (if applicable) For outsiders: Personal details, duties, and responsibilities within the organisation, educational and technical qualifications, CV, passport copy, bank details, passport size photos, medical report, and police verification

Outsourcing employment through an Employer of Record

Choosing your strategy before establishing your business in Bangladesh is essential. You have the option of creating a team from scratch and leading them yourself, or working with an EOR to take care of the duties of managing employee growth and compensation.

Types Of Visas In Bangladesh

Category	Explanation
Business Visa Criteria	Business owners and CEOs in Bangladesh must fulfil requirements in order to receive a business visa. These include having an annual salary of more than five lakh BDT, filing copies of tax returns for the previous two years, and making at least 50 lakh BDT in profit from a business that operates in Bangladesh. In addition, candidates must provide two passport-sized pictures (45mm x 35mm), bank and employee information, and an application letter from a company such as the Board of Investment, Bangladesh Bank, or BEPZA.
Tourist Visa	You must apply for a tourist visa if you want to travel to Bangladesh legitimately to experience its special attractions. The following paperwork is required to apply for a tourist visa: filled out online application a passport as well as a duplicate of the first page a duplicate of your work permit and, if appropriate, your stay permit Two current passport-size colour photos.
Student Visa	This type of visa is designed for students who intend to enrol in an academic program at a state-approved institute or university in Bangladesh.
Employment Visa	This visa is required for anyone entering Bangladesh for employment-related purposes.
Investors Visa	An investor visa is available to people who are investing in a private enterprise that is 100% foreign-owned, new, under construction, or industrially or commercially active.
NGO Visa	One can obtain an NGO visa for a job or service if they are assigned to an NGO that is registered in Bangladesh.

Work Permits

Work Permits	Explanation
Processing time	Around two weeks
Work Permit process	In Bangladesh, acquiring a work permit entails a number of stages. On behalf of the employer, local contacts in Bangladesh must first apply for the work visa. The Bangladesh Investment Development Authority (BIDA) must then receive an online application before issuing an e-visa. The worker can enter Bangladesh if BIDA accepts the application. The next step is for the company to submit a work permit application 15 days before to the employee’s expected arrival in Bangladesh. The cost of this procedure is 5,000 BDT. The work permit will be sent to the Ministry of Home Affairs for security clearance after BIDA has approved it. In addition, the initial setup cost must be covered by an encashment certificate worth at least $50,000 USD.
Passport submission	A copy of the employee’s passport must be provided to any organisation, such as BOI or BEPZA..
Work Permit validity	The typical duration of the work permit is three months. Nevertheless, depending on the specifics of the contract, it may be renewed or extended.
The work Permit process for different nationalities	The procedure for obtaining a work permit is generally the same for citizens of different nations, however there may be a few exceptions or modifications.
Change of sponsor within Bangladesh	To request a change, the employee must submit a fresh letter of application. in sponsorship.
Where is the application processed?	For the country of the employee, the application letter is handled in Bangladesh.
Work permit criteria	The applicant must have a good intention while entering Bangladesh, have no prior convictions, and be able to sustain themselves.
When can an employee travel to Bangladesh	Once all security checks have been completed by the Ministry of Home Affairs, any employee may travel to Bangladesh.
What’s the cost of a Business Visa?	Business visas with one entrance are typically $25 USD.
Duration of Business Visa processing	Every business visa has a standard three-month validity period, however it can be extended. The longest stay allowed during each visit cannot exceed 30 days.
Can you switch from a Business Visa to a Work Permit?	No
Termination of Work Permit	When the contract expires, the work permit loses its validity. A different mechanism is not necessary for cancellation.
Special requirements for Work Permit cancellation	The designated agency, the employee, or the employer may all terminate the work permit.
Work Permit	Every person from outside Bangladesh who wants to work must have a work permit. You may also start running your business without a visa thanks to the work permit. The processing time for a work visa is typically 15 days, and it has a three-month maximum validity period that may be increased.
Criteria to obtain a Work Permit	An individual who wishes to work in Bangladesh must meet the following requirements: A letter of job offer from the employer in Bangladesh. A recommendation letter from institutions such as BOI and BEPZA. A copy of a passport-size photograph. A duly filled and verified visa application form. A passport with a minimum of six months of validity.

Payroll & Taxes In Bangladesh

It is essential to have a full awareness of Bangladesh’s rules and regulations regulating wages and taxation in order to maintain compliance. It is vital for a foreign organisation to abide by local tax rules, including those pertaining to income taxes, business taxes, security taxes, and other matters. You may either collaborate with us and take use of our local contacts in Bangladesh who can guarantee that everything is in compliance with the local rules, making payroll and employment administration more straightforward for you, or you can establish your own team to handle these activities.

Employer Taxation

Tax	Explanation
Financial Year-end Date	30th of June, every year
Tax Documents	IT-11GA
Corporate Tax	Companies in Bangladesh are required to pay a corporate tax of 32.5%.
Withholding Tax (For Non-Residents)	Dividends Percentage:- 20% Interest Income:- 20%
Payroll Tax	Employers in Bangladesh are subject to a progressive payroll tax that ranges from 10% to 30%.
Employers’ Social Security and Statutory Contributions	Bangladesh has no notion of social security, however certain businesses are required to contribute 5% of their profits to the Workers Profit Fund.
Reimbursements	In Bangladesh, reimbursement is not permitted since there is no corresponding legal framework.
Medical Insurance	In Bangladesh, the healthcare system is characterised by diversity and often insufficient regulation. It comprises four main types of institutions:  Non-Governmental Organisations (NGOs),Government institutions,Global agencies,Private companies

 

Employee Taxation

Tax	Explanation
Income Tax Rates	Monthly taxable salary per annum Annual salary Tax Rate(%) 0 to 2,50,000/- Bangladesh Taka Nil 2,50,001/- to 6,50,000/- Bangladesh Taka 10% 650,001 – 1,150,000 Bangladesh Taka 15% 1,150,001 – 1,750,000 Bangladesh Taka 20% 1,750,001 – 4,750,000 Bangladesh Taka 25% 4,750,001 and above 30% Only citizens of Bangladesh have to pay this amount of tax. Foreign residents have to pay tax at a flat rate of 30% of their earnings.
Income Tax Returns	Yes
Employees Social Security and Statutory Contributions	Employees in Bangladesh do not make any Social Security contributions to the government since there is no adequate Social Security system in Bangladesh.
Sales Tax	In Bangladesh, consumers must pay a 15% sales tax when they purchase goods and services. It is one of the main ways that the state makes money.

Without the requirement to set up a subsidiary, we offer Employer of Record (EOR) services to businesses seeking to handle payroll and hire personnel in Bangladesh. With our local connections, hiring and onboarding staff only takes a few days, ensuring that labour rules and regulations are followed.