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Employer of Record (EOR) in Bangladesh

Employer Of Record In Bangladesh

Bangladesh Employer of Record gives you an upper hand at growing your business in Bangladesh independently. Skuad’s international undivided HR platform helps you accelerate the hiring of your local team, administer their salaries, and handle a range of HR responsibilities on your behalf. Skuad will also assist you in expanding your business internationally with the help of our global networks.

Bangladesh At A Glance

Population: 164.7 Million.

Currency: Bangladeshi Taka (BDT)

Capital city: Dhaka 

Languages spoken: Bengali

GDP: 8.2% (2020)

Employment In Bangladesh

Bangladesh's employment laws are governed by the 2006 Labor act and the 2015 Labor Rules Control. These laws apply to all the employees working in commercial and industrial companies, and specify the working hours, weekly holidays, medical leaves and yearly leaves.

Setting up a local business entity in Bangladesh can be expensive, cryptic and a tedious task.

Bangladesh’s labor rules and laws protect the employees, which requires more dedication on the part of the employer to specific sectors and broad knowledge about the prevalent local practices. Skuad’s Bangladesh EOR solution can be the perfect local payroll provider and give you peace of mind while expanding your business, thanks to the extensive knowledge about the Bangladesh labor rules.

Privileges Explanations

Working hours

8 hours per day for a maximum of 48 hours in a week.

Overtime eligibility

All employees are qualified for overtime work, and the pay is set at twice the rate of the basic salary according to Section 108 of the Labor Act.

Paid Public Holidays

Below is the list of public holidays:

  • New Year’s Day (1st January)

  • Language Matyrs’s 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:

  • If an employee chooses to or is required to work on a festival holiday, he/she will be remunerated with 2 additional holidays with full salary and an alternate day leave.

Medical leave

All employees have the right to claim medical leave for at least 14 days with full pay, provided they submit a medical certificate.

Maternity Leave

Female workers who have worked at the company for at least 6 months are allowed to avail 8 weeks of authorized paid leave before and after the birth of the child. Those women who haven’t worked for 6 months are generally eligible for unpaid leave. They are also restricted from working for 8 weeks after the birth of the child.

Annual Leave Accrual Entitlement

Every employee has the right to claim annual leave after completing one year’s service in an establishment. The leaves are counted at the rate of one day for every 18 working days.

Leave Expiry

If any employee chooses not to use their annual leaves, their leaves will be carried forward to the next year with half pay.

Leave Cash Out

Employees can choose to cash out their accrued annual leave with full pay.

Accrued Leave At Termination

Accrued Annual leave payout is allowed to the employees in full when the leave is carried over to the following year.

Employee Protection and Anti-discrimination Rights

Bangladesh’s labor rules and laws dictate all the major implemented rules and regulations for the protection of laborers and worker’s rights. Bangladesh’s constitution also specifies that all Bangladeshis are equal; hence no one can be discriminated against on the basis of caste, class or religion. Labor law states that any child below the age of 14 cannot be employed in any factory. It also grants a 1-hour break for every 6-hours shift and 30 minutes on 5 hours shifts.

Confidentiality of Personal Information

There is no privacy protection law where the employer protects the personal information of an employee. However, Article 43(B) of the Constitution gives every citizen the right to privacy of his communication. The newly introduced Technology Act enables the Government to restrict data under specific conditions, which could be for:

  • The security of the state

  • Relationships with foreign states

  • For investigations.

Contractors vs. Full-Time Employees

In Bangladesh, workers who function based on different contracts independently are known as contractors. Contractual workers pay their own taxes and manage their work independently. On the other hand, full-time employees take orders and instructions from the employer and receive many employment perks from their company for working full time.

Before hiring either full-time employees or contractors, it’s vital to know how either of the positions is suitable for your business structure if the project duration is long or short, depending on the nature of the tasks. For example, accounting and promoting employees are critical tasks in any organization, and these separate departments also require close supervision. In such cases, it is better to employ full-time workers for these tasks.

Similarly, it’s cheaper to employ contractors as they are more spontaneous, and the work is done according to the contract. However, employers generally have less control over contractual workers. These workers schedule their own routine and are sometimes less interested in working for a single company as they’re bound to their contracts with multiple employers. Given the temporary nature of the employment, such workers have a lesser chance of bringing forth lawsuits with the employer.

Book a demo with us for more information about hiring contractors and full-time employees.

Hiring In Bangladesh

According to Bangladeshi laws, the employer must draft a contract of employment that covers all the details ranging from the employee’s salaries, compensation rates to benefits. These details must be listed in Bangladeshi Taka as different currencies might not be accepted. There is no one way of hiring employees in Bangladesh.

Whether contractual or fixed-term, hiring workers depends largely on the organization’s priorities and business strategy, and each has a different set of requirements to be covered in the contracts. Skuad's EOR solution helps organizations hire both types of workers in Bangladesh seamlessly. Skuad’s team of experts can take over the responsibilities of drafting a proper employment contract that covers employment terms, benefits, additional perks and all other details in accordance with the local laws.

For ensuring that your hiring process is compliant with the obligatory laws, speak to Skuad’s experts today.

Probation & Termination

Probation Period

Section 4(8) of the Labour Act dictates that the duration of the probation time depends on the employee’s line of work. If the employee is from an administrative background, the probation period is 6 months, and for other employees, it’s generally 3 months. The probation duration can be increased if the type of service within the first three months of probation is unsatisfactory. However, the employee is entitled to a permanent place at work after completing the probation period.

Termination of service

The employee or the employer both hold power to terminate the contract according to the Labor Act of 2006. The Act provides 5 different procedures to terminate employment:

  1. Termination with notice
  2. Dismissal
  3. Discharge
  4. Layoff
  5. Retrenchment

The employer is responsible for putting out a notice 120 days before termination for rated monthly employees and 60 days for other employees. The worker is also entitled to one month’s pay upon termination for every year of service.

EOR Solution In Bangladesh

Bangladesh Employer of Record simplifies and fastens the process of business expansion into the very heart of Bangladesh. Working with an EOR such as Skuad helps you by establishing swift management of employee earnings, contracts of agreement, tax details and work permits. Skuad can offer the perfect pool of candidates that are suitable for business owners and CEOs without them having to do the difficult work.

General Employer of Record Service Terms

Taxes that apply to invoices

Any company operating in Bangladesh has to pay the government a GST of 15%.

Minimum duration of service

6 months for desk jobs and 3 months for other jobs.

Currency Accepted

Bangladeshi Taka (BDT).

Required Details & Documents

Important personal information, passport copy, bank-related details, NIC card and a TIN number(if applicable) For outsiders: Personal details, duty and responsibilities within the organization, educational and technical qualifications, CV, passport copy, bank details, passport size photos, medical report and police verification

Outsourcing employment through an Employer of Record

It is important to choose what path you want to take when expanding your business in Bangladesh. You can opt to grow a team from scratch and manage them or leave them to an EOR partner such as Skuad to handle the responsibilities of regulating the employees’ salaries and their growth

Types Of Visas In Bangladesh



Work permit

A work permit is compulsory for every overseas individual who wishes to work in Bangladesh. The work permit also allows you to start operating your business without a visa. The work permit generally takes 15 days to be processed and is valid for 3 months but can be extended.

Criteria to get a work permit

Any employees who want to work in Bangladesh need to satisfy these criteria:

  • The foreign citizen must provide a letter of appointment from the employer in Bangladesh.

  • The employee should also have a letter of recommendation from institutions like BOI and BEPZA.

  • A Passport size photocopy

  • Verified Visa application form

  • A passport with at least 6 months validity.

Business Visa Criteria

Business Visa applies to business owners and CEOs who want to set up a business in Bangladesh. The criteria for this are as follows:

  1. The annual profits earned through the business (a company operating in the jurisdiction of Bangladesh) must not be less than 50 lakh BDT.

  2. The annual salary of the applicant must be more than 5 lakh BDT. Bangladeshi citizens must provide a copy of the tax return document of the last two years to prove their financial status.

  3. Application letter from any institution like Board of Investment, Bangladesh Bank or BEPZA.

  4. Back details and employee details

  5. Two copies of a 45mm X 35mm picture.

Work Permit

Work permits


Can Skuad Sponsor Work Permit in Singapore?


Processing time

Around 2 weeks.

Work Permit process

Step 1: Skuad’s local contacts in Bangladesh will apply for the work permit.

Step 2: Skuad’s contacts will apply to BIDA online for the issue of e-visa in Bangladesh. A letter of permission and other details will be sent to the local branch and a certificate in case of incorporation. Details of employees and an Encashment certificate of at least 50000 USD must be paid for the initial establishment cost.

Step 3: Once BIDA has issued the E visa, the worker will enter Bangladesh.

Step 4: Skuad will apply for a work permit in BIDA 15 days before your day of arrival in Bangladesh. 5000 BDT will be required for this process.

Step 5: Once BIDA is done with the work permit, it’ll then be transferred to the Ministry of Home Affairs for security protocols.

Passport submission

The employee has to provide a copy of the passport to any institutions like BOI or BEPZA.

Work Permit Validity

The work permit is generally valid for 3 months but can be renewed or extended depending on the nature of the contract.

Work Permit Process for Different Nationalities

Citizens of most countries go through the same process for issuing a work permit; however, there could be few exceptions or changes.

Change of Sponsor Within Bangladesh

The employee will need to submit a new letter of application for a change in sponsorship.

Where is the application processed?

The application letter is processed in Bangladesh for the employee’s nation.

Work Permit Criteria

  1. The employee must have good intent before entering Bangladesh.

  2. The employee must have a clean criminal record and should be able to support him/herself.

When Can Employee Travel to Bangladesh

Any employee can travel to Bangladesh once the Ministry of Home Affairs completes all security checks.

What’s the cost of a business visa?

Standard single entry business visas cost 25 USD.

Duration of business visa processing

Every business visa is valid for generally 3 months, but it can be extended. The maximum number of days stayed on each visit must not exceed 30 days.

Can you switch from a Business Visa to a Work Permit?


Termination of Work Permit

The work permit becomes invalid as soon as the contract comes to an end. No other system is required for cancellation.

Special Requirements for Work Permit Cancellation

The work permit can be canceled either by the employer or the employee, or the appointed agency.

Payroll & Taxation In Bangladesh

To regulate earnings and oversee tax collection in Bangladesh, you must have a clear understanding of the rules and regulations. As an international organization, it is important to know and follow the country's laws like taxes on income, taxes on business, security taxes and more. There are two ways of regulating this:

  1. You can establish and make your own team to manage the salaries and taxes.
  2. You can take our help with our local contacts in Bangladesh who will make sure that everything is in accordance with the Bangladesh laws and make management of payroll and employment easier.

Taxes In Bangladesh

Tax Explanation

Income Tax Rates

Monthly Taxable Salary per annum.

Annual salary

Tax Rate(%)

1. 0 to 2,50,000/- Bangladesh Taka


2. 2,50,000/- to 4,00,000/- Bangladesh Taka


3. 4,00,000/- to 5,00,000/- Bangladesh Taka


4. 5,00,000/- to 6,00,00/- Bangladesh Taka


5. 6,00,000/- to 30,00,000/-


6. 30,00,000/- plus


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


Financial Year End Date

30th June of every year.

Tax Documents


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

Bangladesh government levies a progressive payroll tax on employers ranging from 10% to 30%.

Sales Tax

Consumers in Bangladesh have to pay a sales tax of 15% for buying services and products. It is one of the major sources of income for the state.

Employers Social Security and statutory contributions

The concept of Social security in Bangladesh is non- existent. Although, certain companies have to pay 5% of their earnings to the Workers Profit Fund

Employees Social Security and statutory contributions

There is no proper Social Security system in Bangladesh, so employees in Bangladesh don’t pay any Social Security to the Government.


Reimbursement in Bangladesh is not possible as there is no law related to it.

Medical Insurance

In Bangladesh, the healthcare system is diverse and often poorly regulated. Healthcare consists of mainly four institutions in function:

  1. NGOs

  2. Government institutions

  3. Global Agencies

  4. Private Companies

Businesses planning to expand into the Bangladesh market will need the assistance of local HR professionals to manage the complex taxation, compliance, and payroll procedures in the country. For this, it is advantageous to partner with a local EOR such as Skuad’s Bangladesh EOR solution to handle this on your behalf.

Business enterprises often face difficulty while operating with the banking institutions in Belarus and their rules and regulations vastly differ from the structure and rules of international business transactions. Currently, Bangladesh is revising its banking structure which simplifies the expanding process for companies.

It’s also very important to understand the rules and regulations of Bangladesh. If you don’t plan on taking any global EORs help like Skuad, you should take assistance from a lawyer who's well-informed about the Bangladesh subsidiary laws. You can also choose to groom your own team to look after the hiring and payroll process.

Types of company structures in Bangladesh:

  1. Most of the companies operating in Bangladesh today are PLLC Private Limited Liability Company. It’s a different legal entity, and generally, shareholders are not held accountable for the company’s dues more than the number of share capitals they have invested.
  2. The LLC structure has its own legal framework, and you need at least two directors and two shareholders. Bangladesh has a minimum requirement of share capital, which costs just $1. You’ll also have to provide the annual financial records to the Income Tax Authority of Bangladesh.

If you’re determined to take the next step and open up a subsidiary in Bangladesh, you might be in need of some help. Skuad’s EOR, Bangladesh, can be your perfect partner who can let you rest as they streamline the process.


Skuad offers EOR(Employer of Records) services for organizations who want to employ employees and run payroll without opening a subsidiary in Bangladesh. Employees will be employed in days through Skuad’s local contacts in accordance with the labor laws.

Book a demo here.

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