COUNTRY

Written Agreements

Written employment contracts or letters of appointment in the local language are legally required, spelling out the terms and conditions of compensation (in local currency), benefits, and termination. The terms of the contract are binding between the employee and employer, providing they do not contradict the provisions of the Labor Act. Typically, the letter of appointment or written contract also includes:

• Working hours
• Salary
• Job title
• Nature of work
• Working time and leave provisions
• Procedures for dismissal

According to the Contract Act of Bangladesh, every agreement by which anyone is restrained from exercising a lawful profession, trade or business of any kind, is void. Therefore, agreements prohibiting competition, solicitation, or dealing after termination are against the law and consequently deemed null and unenforceable.

Oral Agreements

The labor law of Bangladesh does not provide regulations regarding oral employment contracts.

Implied Agreements

There are no provisions or guidance on implied contracts. Best practice in the industry is to be cautious of implied contracts by frequently utilizing or adapting written agreements.

Employees may not be required or allowed to work in an establishment for more than 8 hours per day on a regular basis (occasionally, they may work up to 10 hours a day). Standard weekly working hours may not exceed 48 hours. The total hours of work (that includes overtime) cannot go over 60 hours in any week and, on average, 56 hours per week in a year.

All employees are entitled to an interval of 1 hour for rest or meal for work of more than 6 hours a day, an interval of half an hour for rest or meal for work of more than 5 hours a day, and an interval of 1 hour rest or 2 intervals of half an hour rest, for work of more than 8 hours a day.

Employees are generally entitled to 11 days of festival holidays (determined by employer) with pay. If required to work on a holiday, employees may receive two compensatory paid and one substitute holiday.

Major holidays for include:

• Shaheed Day and International Mother Language Day - February 21
• Independence and National Day - March 26
• Bengali New Year’s Day - April 14
• May Day - May 1
• Buddha Purnima (Boishakhi Purnima) - date subject to change every year
• Shab-e-Qadar - date subject to change every year
• Eid-ul-Fitr (3 days' leave) - dates subject to change every year
• Eid-ul-Azha (3 days' leave) - dates subject to change every year
• National Mourning Day - August 15
• Krishna Janamashtami - date subject to change every year
• Moharrum (Ashura) - date subject to change every year
• Durga Puja (Bijoya Dashami) - date subject to change every year
• Eid-e-Miladun-Nabi - date subject to change every year
• Victory Day - December 16
• Christmas Day - December 25
• New Year's Eve - December 31

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 four 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 8 weeks of employer-paid maternity leave before the birth of a child and 8 weeks of paid leave after. Employers are prohibited from knowingly employing a woman, and women are also prohibited from working during the 8 weeks 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 8 weeks before and 8 weeks after childbirth. If the mother dies during childbirth or up to 8 weeks 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. Minimum wages for those working in Export Processing Zones (EPZs) are from BDT 6,250 to BDT 14,950, depending on the industry as well as the skill level and experience of the employee. The minimum rates of wages fixed for the employees employed in any industry are re-fixed every 5 years under the government's supervision. Minimum wage for employees in garments 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 is 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)

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

• 30 days for a permanent employee
• 15 days for 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.

In both cases, severance pay amounts to 30 days' wages for each completed year of service or for any part thereof in excess of 6 months (limited to 25 years). Additionally, workers are entitled to 45 days' wages for each completed year above 10 completed years. In case an employee is dismissed for misconduct other than theft, misappropriation, fraud, embezzlement, breaking in the establishment, 'riot' or “disorderliness“, they are entitled to a severance pay of at least 15 days' wages for each completed year of service.

Pension

The government 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 3,000 (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, and deserted by their family. Beneficiaries of old-age allowance receive BDT 600 a month payable every quarter, without limit of time.

Private employees can participate in a voluntary pension scheme called the Universal Pension Scheme. There are four plans available under the Universal Pension Scheme: Pragati, Surokkha, Samata, and Probas. Only Bengali citizens are eligible to enroll, and a worker must complete 10 years of contributions to be entitled to a pension. Workers 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 a permanent disability, a lump sum amount of BDT 125,000 (Bangladeshi takas) is paid
• In case of permanent partial disability, a percentage of the average monthly wage 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 2 years

According to the Rights and Protection of Persons with Disabilities Act of 2013, persons with disabilities are eligible for a monthly allowance of BDT 850, provided they are permanent residents and have an annual income less than BDT 36,000.