Hire in Bangladesh, without setting up an entity
With rapid economic growth and an openness to foreign investment, Bangladesh represents a promising expansion opportunity for many investors. It also provides a skilled, educated and young workforce that is technologically savvy and embracing new opportunities.
Strategically situated between major consumer markets, Bangladesh also embraces trade with neighboring and overseas partners, including tariff-free arrangements. Prudent investors may choose to expand to this new market, but they may need assistance in penetrating the market in a compliant fashion.
Bangladesh PEO & Employer of Record Solution
New Horizon’s Bangladesh PEO services allow companies to hire employees in Bangladesh without first establishing a legal entity. We handle all HR, payroll, tax and benefits administration while the business maintains daily control over the staff’s work. This cost-effective option allows you to deploy staff faster while maintaining full legal compliance.
Through our Bangladesh PEO, 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
Labor 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.
Holidays in Bangladesh
New Year’s Day
Bangabandhu Homecoming Day
Maha Shivaratri, Language Martyrs’ Day
National Flag Day
Sheikh Mujibur Rahman’s birthday
27 Mar-7 Apr
Shab e-Barat, Public Holiday,
Maundy Thursday, Public Holiday
Holy Saturday,Public Holiday
Easter Day, Public Holiday
Chaitra Sankranti, Easter Monday, Public Holiday
Bengali New Year, Public Holiday
15 Apr-30 Apr
May Day,Public Holiday
2 May-5 May
Buddha Purnima/Vesak, Public Holiday
7 May-9 May
Mothers’ Day, Public Holiday
11 May-18 May
Shab-e-qadr, Public Holiday
20 May-21 May
Jumatul Bidah, Public Holiday
23 May-24 May
Eid ul-Fitr, Public Holiday
29 May-30 May
June Solstice, Fathers’ Day
July 1 Bank Holiday
Raksha Bandhan, Eid al-Adha Day 3
Eid al-Adha Day 4
National Mourning Day
Akhari Chahar Somba
First Day of Navaratri
Eid e-Milad-un Nabi
Lakshmi Puja,Sri Shayama Puja
New Year’s Eve
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 employees 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.
Benefits of using a Bangladesh PEO
When you want to hire employees in Bangladesh, setting up a branch office or establishing a subsidiary is not always the best option. This step can often take weeks or even months, and be an expensive options. Using a PEO is faster and usually more efficient. Additionally, using a Bangladesh PEO allows you to minimize your risk in case you want to test the market before investing in a separate entity in Bangladesh.
Our PEO and payroll option in Bangladesh lets you skip the hassle of setting up a separate entity and trying to make sense of the complex labor laws here.
There are many benefits to using a Bangladesh PEO, including:
- Speed – Using a PEO allows you to deploy staff faster, often within a matter of days.
- Compliance – Our local experts have a deep understanding of local labor rules and regulations. We will ensure you comply with all local labor, tax and payroll requirements. The burden of compliance is on us, not you.
- Reduce risk – By using a Bangladesh PEO, you transfer risk to a trusted third party like New Horizons. You also reduce the risk associated with making a large investment in Bangladesh.
- Access to better benefits – Since we leverage all of our local employees, we can offer more competitive benefits to your employees to make you a more attractive option for employment.
- Simplicity – Using our Bangladesh PEO services allows you to maintain control over your business without taking on liabilities associated with setting up a separate legal entity.
- Seamless transition – If you do later decide to establish a legal entity in Bangladesh, we can help your employees seamlessly transition.
- Focus on your business – Because you delegate administrative tasks to a trusted legal partner, you can focus on your business’ core activities.