Bangladesh Employment Law – An Overview

Bangladesh offers a readily available pool of skilled professionals at competitive rates across diverse industries. The balanced and flexible nature of Bangladesh’s employment law makes it a win-win for both employers and employees.This blog will dive deep into the modulation of Bangladesh employment law and explore key elements shaping its labor market.

The Department of Labor and the Department of Inspection for factories and establishments supervise the enforcement and implementation of the labor regulations in Bangladesh. 

Let’s go deep into understanding the labor market of Bangladesh.

Employment laws in Bangladesh – A detailed review

With a vast population of approximately 160 million, Bangladesh offers an affordable workforce primarily engaged in various sectors. Under the nation’s labor laws, anyone working in any industry or establishment, whether in a technical, manual, promotional, skilled, or unskilled capacity, is classified as an “employee.” 

This classification applies equally, whether their employment terms are written down or not.

Types of workers 

In Bangladesh, there are varieties in the job market. The following types are: 

• Apprentice: As trainee + allowances ( freshers only)
• Substitute/ Badli: Replacement of permanent worker or probation worker 
• Temporary: Temporarily appointed based on project for a limited period 
• Probationer: Probation in nature, though it’s a permanent post

Permanent: The employee must complete the probation period and receive the permanent employee paper

Employment conditions in Bangladesh

The Bangladesh Labor Act of 2006 stipulates that while establishments can formulate their own service rules, these must encompass all the stipulations outlined in the Act. The Chief Inspector must endorse these services and rules, subject to their approval, unless revisions are made within 90 days of submission.

In cases of disagreement, there is a provision for an appeal to the Court within 30 days. The government is furthermore responsible for resolving the appeal within 45 days, with its final decision per Bangladesh employment law.

Employee rights & labor law in Bangladesh

Employers must provide every worker they hire with an official appointment letter and a photo identity card for each employed individual.

Working hours as per Bangladesh labor law

Labor laws in various jurisdictions mandate limits on working hours. Initially, lawmakers set these limits to ensure a safe and healthy workplace and to provide adequate rest between shifts.

Over time, however, they have evolved also to support broader policy goals, such as helping workers balance their jobs with family life and other personal responsibilities, enhancing productivity, and reducing unemployment. 

In Bangladesh, the 2006 Labor Act specifies regular working hours on a daily and weekly basis, in addition, provisions for overtime and compensation.

According to the Bangladesh Employment Law, employers must adhere to the following working hours:

• Daily working hours: 8 hours/day 
• Weekly working hours: 48 hours/week
• Overtime: 10 hours/day; 60 hours/week 
• Night shift: 24-hour break after every night shift ( shift hours depending on the urgency of the work and the team leader’s decision)
• Women workers restrictions: Women workers won’t assign tasks between 10 pm to 6 am without her consent

Break time: Daily break

• 6 hours shift: 1-hour break
• 5 hours shift: 30 minutes break 
• 8 hours shift: two 30-minute break or one 1-hour break at a stretch

Employees get 56 hours on average per week.

Note: Please note that in Bangladesh, there are daily working hours limited to 8 hours, which should be at most 10 hours as per section 100.

Wages in Bangladesh

Understanding wages in Bangladesh requires considering factors like industry, skill level, location, and experience. Here’s a breakdown to help you navigate:

Minimum wage

• The current national minimum wage in Bangladesh is BDT 8,800 per month ( USD 81) for major industries and BDT 8,000 per month ( USD 73) for other sectors (effective November 7, 2023).
• It’s approximately USD 105-95 per month, which is relatively low compared to other countries.

Average wages

• Average monthly wages vary significantly across industries and skill levels.
• Unskilled workers in rural areas might earn as low as BDT 5,000-6,000 per month ( USD 45 – USD 55), while skilled professionals in urban areas can earn BDT 20,000-50,000 ( USD 182 – USD 455) or even higher. 
• Some sectors like IT, pharmaceuticals, and finance offer comparatively higher wages.

Factors affecting wages

• Industry: Wages are generally higher in industries requiring specialized skills or facing intense competition for talent, such as IT or manufacturing.
• Skill level: Unsurprisingly, skilled workers with experience command higher wages than those with basic qualifications.
• Location: Wages are higher in urban centers like Dhaka and Chittagong than rural areas.
• Experience: Years of experience and proven expertise can significantly boost earning potential.

Also Read: Hire in Bangladesh Guide

Types of leaves in Bangladesh

Under the Bangladesh Labor Act 2006, employees have entitlements to various types of leaves during their tenure, including both paid and unpaid leave, as specified by Bangladesh employment law. Below is the breakdown: 

Paid leaves

• Annual leave: Employees are entitled to at least 15 days of paid annual leave each year. The unused leaves will be accumulated and carried over to the following year.
• Sick leave: Employees are entitled to 7 days of paid sick leave per year. Additional leave is available based on individual contracts or collective bargaining agreements.
• Casual leave: Employees are entitled to 10 days of paid casual leave per year. Employees saved this leave for unexpected events or short breaks.
• Festival leaves: Bangladesh observes several national and religious holidays, and paid leaves for employees. These include Eid al-Fitr, Eid al-Adha, Durga Puja, Christmas, and Independence Day.
• Maternity leave: Women employees are entitled to 6 months of paid maternity leave before and after childbirth. It’s an extendable leave, up to 2 years with reduced pay.
• Paternity leave: Fathers are entitled to 5 days of paid paternity leave. This leave is for male employees to take care his family during childbirth.

Unpaid leaves

• Leave for education: There is no paid leave approved for educational purposes of employees.
• Bereavement leave: If death happens in the family, employees get three days unpaid leave to stay beside the family members.
• Leave for marriage: Employees are entitled to 7 days of unpaid leave for their wedding or the marriage of an immediate family member.

Tax structure in Bangladesh

According to Bangladesh employment law, working professionals pay income tax based on a progressive tax system. Here’s a breakdown of the key elements:

Tax rates

• Bangladesh’s current individual income tax rates are progressive, ranging from 0% to 25%.
• The specific rate applied depends on your total taxable income for the year. Here’s a simplified breakdown:

The hiring process for the Bangladesh workforce consists of several lengthy and complex steps. Besides, international employers must establish an entity to hire such a cheap workforce for global countries. 

Or you can sign up with Global Squirrels to align with Bangladesh employment law. What’s more? Let’s explore.

Global Squirrels – you can comply with Bangladesh employment law

Global Squirrels is one of the leading hiring and payroll management platforms. If you plan to hire employees from Bangladesh, sign up with Global Squirrels, which can smoothen the entire process. 

The platform helps in payroll management, which assists in compensation calculation, managing leaves and benefits sheets, compliance with international labor laws, and mitigating local labor laws and regulations. You can request a demo to understand the functionality of the platform. 

The platform helps in many ways, including: 

• You can access a massive Bangladesh talent pool from several industries 
• It’s a cost-effective platform 
• You will get assistance regarding compliance 
• It will help you in onboarding, tax calculation, payroll, benefits, and many more 
• It’s an easy-to-use platform

Conclusion

Bangladesh employment law is based on the Labor Act 2006 which maintains equality for both employers and employees. In addition, the cheap labor market with a comparatively low salary structure encourages global employers to hire employees from Bangladesh. Sign up with Global Squirrels and onboard Bangladesh employees to expand your global team further.