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The qualifying period for all employees' annual leave entitlement is 1 year of continuous service in an establishment with a minimum of 240 days of service within the previous 12 months.

• 1 day for every 18 days in a shop, commercial, industrial establishment, factory, or road transport
• 1 day for every 22 days on a tea plantation
• 1 day for every 11 days for newspaper employees

Unused annual leave may be carried forward up to 40 days for most workers (60 days in some cases). If an employee plans to take 4 or more days of consecutive leave, they may be paid in advance. Other than annual leave, all employees, except those employed in a tea plantation, are entitled to 10 days' paid casual leave during a calendar year. This type of leave cannot be carried forward.

Private sector employees are entitled to annual paid sick leave of 14 days with a required medical certificate and no carry forward permitted. Public sector employees are entitled to a medical leave of up to 6 months with a medical certificate.

Employees who have worked for at least 6 months (or under 6 months if unpaid) are entitled to 60 days of employer-paid maternity leave before the birth of a child and 60 days of paid leave after. Employers are prohibited from knowingly employing a woman, and women are also prohibited from working during the 60 days immediately following the delivery date. If an employee miscarries before the beginning of the maternity leave, the employee is entitled to 4 weeks of paid leave.

Every female employee who has been in service under the same employer for at least 6 months is entitled to maternity benefits unless she has 2 or more surviving children at the time of her delivery. Leave for a third or subsequent child is unpaid. The maternity benefit shall be calculated by monthly earnings divided by 26.

The employer must pay the total cost of the maternity benefit, and the benefit must be paid for 60 days before and 60 days after childbirth. If the mother dies during childbirth or up to 60 days after childbirth, the benefit is paid to the person who cares for the child.

New fathers may use the fully paid casual leave of 10 days in the absence of statutory paternity leave.

Minimum Wage

The monthly minimum wage ranges from BDT 521 to BDT 16,240 (Bangladeshi takas), depending on the industry. The minimum wage for those working in Export Processing Zones (EPZs), effective December 1, 2023, is BDT 12,800 (Bangladeshi takas). This wage structure applies to all industrial establishments within the EPZs, covering approximately 500,000 employees across 8 operational zones. The annual wage will increase 10% for 50% of the employees. The remaining 50% will see increases of 9-10% based on performance. The minimum rates of wages fixed for the employees employed in any industry are re-fixed every 3 years under the government's supervision. Minimum wage for employees in the garment industry is BDT 12,500 per month.

Where there are no minimum wage requirements, the base wage of the employee cannot be less than 50% of the gross wage.

Effective April 1, 2022, the Bangladesh Central Bank set a minimum salary for bankers of:

• BDT 39,000 for general branch officers
• BDT 36,000 for cash officers
• BDT 28,000 for trainee branch officers
• BDT 26,000 for trainee cash officers

However, as of March 2022, the wage increase is being litigated in the Supreme Court, as the legality of the central bank's authority to set a minimum wage is at issue.

Wage period cannot exceed 1 month. Wages must be paid by the 7th working day following the last day of the wage period in respect of which the wages are payable.

Overtime, Holiday & Vacation Pay

Overtime is paid at twice the ordinary rate of the basic wage. Employees who have completed at least 1 year of service are entitled to 2 holiday bonuses each year at 100% of the basic salary.

While an employee, under special circumstances, may be required to work on any public holiday, in return, they will be entitled to 2 days of compensatory holidays with wages and a substitute holiday.

Notice Period

In Bangladesh, an employer who wishes to dismiss a permanent employee must provide a notice in writing of:

• 120 days (for permanent employees)
• 60 days (for all other employees)

An employer who wishes to dismiss a temporary employee must provide a notice in writing of:

• 30 days (for monthly rated employees)
• 14 days (for all other employees)

Any employee who wishes to resign must give their employer notice in writing:

• 30 days for a permanent employee
• 15 days for a temporary employee or any other employee

If an employee wishes to leave work without notice, they must pay their employer an amount equal to the wages they earned for the period of notice.

Severance Benefits

Severance pay is payable to an employee who has been continuously employed for at least 1 year in the event of a:

• Termination based on physical or mental incapacity or continued ill-health (referred to as 'discharge')
• Termination with notice without any reason.

An employee who is discharged due to physical or mental incapacity after at least 1 year of continuous service is entitled to compensation equal to 30 days of wages per completed year of service, or gratuity if higher. Similarly, when an employer terminates a permanent employee, they must provide 30 days’ wages per completed year or the higher gratuity amount. In contrast, if an employee is dismissed for misconduct after at least one year of service, the compensation is reduced to 15 days of wages for each completed year of service.

Employees who resign are entitled to 7 days' wages for 3 years of continuous work, 15 days' wages for more than 3 years but less than 10 years of continuous work, and 30 days' wages or gratuity (whichever is higher) for 10 years of continuous work or more.

The employer must pay all dues due to the worker within a maximum of 30 working days after the termination

Pension

Bangladesh’s retirement system combines a long-standing provident fund structure with the newer Universal Pension Scheme (UPS). Under the Labour Act, private-sector employers may establish a provident fund (mandatory if three-fourths of employees request it) in which both employer and employee contribute 7–8% of basic wages. These contributions grow over time and are paid out as a lump sum at retirement, offering significant savings but no lifelong income stream.

To complement this, the Universal Pension Scheme introduced in 2023, provides a voluntary, government-run pension open to all citizens, including informal workers and expatriates. Participants contribute a fixed monthly amount and receive a monthly pension for life starting at age 60. Together, the provident fund and UPS form Bangladesh’s national retirement framework.

The government also provides an old-age allowance where the recipient must be at least 65 years of age (62 years of age for women), and their annual average income must be under BDT 10,000 (Bangladeshi takas). Priority is given to those who are physically and mentally infirm or handicapped, have no assets, are homeless, landless, freedom fighters, widowed, divorced, single, or deserted by their family. Beneficiaries of old-age allowance receive BDT 650 a month, payable every quarter, without limit of time.

Private employees may participate in the Universal Pension Scheme. There are 4 plans available under the Universal Pension Scheme: Pragati, Surokkha, Samata, and Probas. Only Bengali citizens are eligible to enroll, and an employee must complete 10 years of contributions to be entitled to a pension. Employees can contribute for up to 42 years, assuming they start making contributions at 18 years of age. The amount is the total sum of contributions plus any interest accrued.

Dependents/Survivors Benefits

If an employee dies while in service after continuous work for at least 2 years, their nominee (or, in the absence of such, dependents), must be paid by the employer compensation at the rate of 30 days’ wages for a normal death and of 45 days for accidental death occurred while working in the establishment or on duty for every completed year of service or any part thereof over 6 months, or gratuity (whichever is higher). The amount is an addition to any other benefit to which the deceased employee would have been entitled if they had retired from the service.

Under the new voluntary Universal Pension Scheme, pensioners who are entitled to receive benefits through this scheme may nominate a beneficiary in the event of death before the age of 75. The nominated beneficiary will receive the monthly payments on behalf of the pensioner until the date the pensioner would have reached the age of 75. If the pensioner does not specify a beneficiary, the heir or successor of the pensioner will be the beneficiary.

Invalidity Benefits

In Bangladesh, employees who have suffered a bodily injury by accident arising out of or caused directly by their job are entitled to compensation, except when it is caused by their own negligence.

Compensation shall be calculated as follows:

• In case of injury, the basic wage is paid
• In case of death, a lump sum amount of BDT 200,000 is paid
• In case of a permanent disability, a lump sum amount of BDT 250,000 (Bangladeshi takas) is paid
• In case of temporary disability, 100% average monthly compensation is paid for the first 2 months, 66.7% is paid for the next 2 months, and 50% for subsequent months up to 1 year.

According to the Rights and Protection of Persons with Disabilities Act of 2013, persons with disabilities are eligible for a monthly allowance of BDT 900, provided they are permanent residents and have an annual income less than BDT 36,000.

Personal Income Tax

Residents must pay income tax on their worldwide income, while non-residents are taxed on income earned in Bangladesh. Individuals are considered residents if they have been in Bangladesh for a period of 183 days or more in the relevant income year, or for 90 days or more in the relevant income year, and they have been in Bangladesh for a period of 365 days or more during the 4 preceding income years.

For the 2025-2026 tax year, there is a progressive scale of income tax rates ranging from 0% to 30%. For the 2026-2027 tax year, the progressive scale also ranges from 0% to 30%; however, the structure changes, the 5% band is removed, and the tax-free threshold is raised from BDT 350,000 to BDT 375,000, with the next band taxed directly at 10%.

Non-residents who are not Bangladeshi nationals are taxed at a flat rate of 30% on their income from Bangladesh sources, for both the 2025-2026 and 2026-2027 tax years.

Visas

Citizens of most countries require a valid visa to enter Bangladesh. There are about 30 categories of visas available for Heads of State, government delegates, diplomatic officials, UN and other international organizations' officials, NGO workers, employees, consultants, business people, investors, research, athletes, journalists, students, and their family members. Stay durations vary depending on visa types:

• Single entry visa - valid for 6 months, allows staying for not more than 3 months.
• Transit visa - valid for 6 months for persons traveling to other countries via Bangladesh, allows staying for not more than 15 days.
• Multiple entry visa - valid for 6 months for multiple entries, allows for stay up to 3 months at one time

Work Permits

A work permit is mandatory for foreign nationals seeking employment. These permits are usually considered if local experts (given priority for employment) are unavailable or unable to perform.

The Bangladesh Investment Development Authority (BIDA) oversees the issuance of work permits for foreign nationals employed by companies registered and operating in Bangladesh. Employers must obtain BIDA approval for each foreign employee, and BIDA evaluates applications based on criteria such as the necessity of hiring a foreign worker, company compliance, and sector regulations. In practice, BIDA is the central authority for managing and regulating foreign employment in the country.

Bangladesh operates 2 parallel labor law systems governing the employment of children and adolescents. Under the Labour Act, children under the age of 14 are completely prohibited from employment, and parents or guardians may not enter into any agreement allowing a child under 14 to work. Adolescents aged 14 to 17 may be employed outside EPZs only if they hold a medical certificate of fitness and are not engaged in any work declared hazardous by the government. Under the EPZ Labour Act, no children or adolescents under 18 may be employed in EPZs or Economic Zones.

In factories or mines, adolescents may work no more than 5 hours per day or 30 hours per week, while in other establishments they may work no more than 7 hours per day or 42 hours per week. Adolescents are prohibited from working between 7:00 PM and 7:00 AM. Overtime must not exceed 36 hours per week in a factory or mine or 48 hours per week in any other establishment.