POPULATION
29.7m
CURRENCY
रू (NPR)
CAPITAL CITY
Kathmandu
Nepal, officially the Federal Democratic Republic of Nepal, is a country in South Asia. Known for its stunning landscapes, diverse culture, and rich history, Nepal is a popular destination for tourism and cultural exploration. From the bustling streets of Kathmandu to the serene landscapes of the Himalayas, Nepal offers a wealth of cultural and natural attractions.
Nepal's economy is diverse, with key sectors including manufacturing, services, and agriculture. The country is a major exporter of goods and a popular tourist destination, attracting visitors from around the world with its beautiful cities, historic sites, and world-renowned cuisine.
Disclaimer: This content is for informational purposes only. We do not guarantee the accuracy or completeness of this content. It is not legal advice and shall not be relied on as such.
Nepal's Labour Act does not make written contracts mandatory. As a result, agreements can be made orally. When they are concluded in writing, employment contracts must contain information on working conditions, remuneration, date of starting the contract, job designation and other relevant terms. Contracts must be provided to employees within 1 month of their start date.
Nepal's Labour Act states that employees can be dismissed for acting in collaboration with a competitive employer or carry on any competitive business on their own, or provide any secret information of the enterprise when they are employed by any competitive employer.
Nepal's Labour Act does not make written contracts mandatory. As a result, agreements can be made orally. The existence of an employment contract can be proved by any means.
Nepalese law enforces indirect or quasi-contracts. Therefore, an oral or written agreement need not be concluded for there to be an existing contract. A contract will be implied in case any person gives anything to another person or employs them in any work, to pay the appropriate cost or remuneration.
In Nepal, regular working hours are 8 hours per day and 48 hours per week. Working hours of employees under 16 years of age cannot exceed 6 hours per day and 36 hours per week. Any work carried out in addition to regular working hours is considered overtime and must be paid at a rate of 150% of the employee's regular wages. The maximum overtime period may not exceed 4 hours per day and 24 hours per week.
Prithvi Jayanti; Maghe Sankranti; Sonam Losar; Martyrs' Day; Maha Shivaratri; Ghyalpo Losar; Prajatantra Diwas; International Women's Day; Ghode Jatra *; Ram Navami; Nepali New Year; Loktantra Diwas; Buddha Jayanti; Labour Day; Ganatantra Diwas; Ramjan Edul Fikra; Edul Aajaha; Raksha Bandhan; Shree Krishna Janmashtami; Nijamati Sewa Diwas *; Hartalika Teej *; Rishi Panchami *; Constitution Day; Indra Jatra *; Ghatasthapana; Fulpati; Maha Ashtami; Maha Navami; Vijaya Dashami; Ekadashi; Dwadashi; Kojagrat Purnima; Laxmi Puja; Govardhan Puja; Bhai Tika; Chhath Puja; Guru Nanak Jayanti *; Udhauli Parva; Christmas Day; Tamu Losar
*Celebrated by specific sub-groups
In Nepal, the employment relationship is predicated on a probationary period of continuous service lasting 6 months or a full running season in the case of seasonal employment. After this period, the employee will be appointed permanently and provided with an appointment letter confirming the position title, the conditions of service, and the entitled remuneration. If the employer is not satisfied with the employee's performance, they can terminate the employment contract without notice.
Both employers and employees must provide notice before submitting a letter of employment termination, except in cases of dismissal for misconduct. The notice period correlates with the service period and ranges from 1 day (for employment up to 4 weeks) to 30 days (for more than a year of employment).
If any party fails to provide an appropriate notice period to the other party, they are liable to pay the remuneration for the period of such notice to the other party.
In Nepal, employees dismissed for redundancy are entitled to severance benefits of 1 month's basic wages for every year of service. Employees that have less than 1 year of service receive severance benefits in proportion to their service period.
The minimum wage for employees in Nepal was last set on August 27, 2023, and is currently as follows:
Nepal's Labour Act requires salary payments at least once a month. For employees working for less than a month, payment must be made within 3 days of the completion of their work. For casual employees, payment must be made immediately after the completion of the work.
Nepal's New Labour Act provides for overtime after the maximum working hours (8 per day and 48 per week) have been exceeded. The overtime limit for any employee is 4 hours a day and 24 hours a week. Payment is stipulated at 1.5 times the basic remuneration. The 30-minute break rule after 5 hours of work applies in the context of overtime. Part-time employees are also entitled to an overtime premium.
Employees are entitled to paid annual leave at the rate of 1 day for 20 days of work.
Employees working on public holidays receive a replacement holiday within 21 days.
In Nepal, the Department of Immigration outlines the following visa types:
Foreign nationals hired for work in Nepal must request a work permit from the Department of Labour. Employers must apply for a work permit for their employees. It is also compulsory to produce a written employment agreement in a language understandable by foreign employees or in English. The validity period of a work permit is three years unless otherwise stated in the employment contract.
Employees who are provided diplomatic immunity, have written arrangements based on a treaty or agreement with the Government of Nepal, or are employed as technicians for 3 months or less to repair machinery or install new technology may proceed without a work permit. Employees also require a working visa from the Department of Immigration.
Population 29.7m
Population in total, including all residents regardless of legal status © 2024 - WBG • EUROSTAT
22.4%
Urban Population
55.8%
Internet access
60%
Banking access
100%
Mobile phone access
Population: The World Bank: World Development Indicators: World Bank Group • World Population Prospects, United Nations (UN), uri: https://population.un.org/wpp/, publisher: UN Population Division; Statistical databases and publications from national statistical offices, National Statistical Offices, uri: https://unstats.un.org/home/nso_sites/, publisher: National Statistical Offices; Eurostat: Demographic Statistics, Eurostat (ESTAT), uri: https://ec.europa.eu/eurostat/data/database?node_code=earn_ses_monthly, publisher: Eurostat; Population and Vital Statistics Report (various years), United Nations (UN), uri: https://unstats.un.org, publisher: UN Statistics Division
Urban Population: The World Bank: World Development Indicators: World Bank Group • World Urbanization Prospects, United Nations (UN), uri: https://population.un.org/wup/, publisher: UN Population Division
Internet access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU), uri: https://datahub.itu.int/
Banking access: The World Bank: World Development Indicators: World Bank Group • FINDEX, WBG (WB), uri: https://www.worldbank.org/en/publication/globalfindex
Mobile phone access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU)
In Nepal, annual leave (called 'home leave') is granted at the rate of 1 day for 20 days of work, up to a maximum of 18 days per year. It is fully paid. However, as a general principle, leave is not seen as a right but as a privilege.
Annual leave accumulates up to a maximum of 90 days. Any excess accumulation is cashed in every year.
If an employee's contract is terminated or they die, the payment for unused leave is made to them or their family members.
Nepal's Labour Act entitles employees to fully paid sick leave of up to 12 days per year. If the employee has worked for the employer for less than 1 year, sick leave is granted in proportion to the employment period. Employees can accumulate sick leave up to a maximum of 45 days and must be paid their basic remuneration for accumulated sick leave of over 45 days at the end of the year.
Nepal's New Labour Act provides maternity leave of up to 14 weeks (~98 days), out of which 60 days are fully paid. Employees must take compulsory leave from 2 weeks before and until 6 weeks after delivery. This leave is also granted in case of stillbirth or miscarriage after 7 months of pregnancy. If recommended by the doctor, an employee can extend her maternity leave by a month.
The employer is responsible for paying the employee their regular remuneration for the first 60 days of maternity leave, while Nepal's Social Security Fund provides benefits for the remaining 38 days of maternity leave. The fund also provides NPR 7,500 (Nepalese rupee) per delivery up to 2 times.
In the case of the mother's death within 60 days of the child's birth, her husband or partner becomes entitled to the remuneration from the employer for the remaining period.
Nepal's Labour Act provides for fully paid paternity leave of up to 15 days. The leave can be taken once the wife of the male employee begins labor.
In Nepal, contribution to the Social Security Fund is mandatory for employees and employers.
Old age benefits are paid to employees who have reached 58 years of age (or 60 years for government employees). If the employee has completed 20 years in service, they will be eligible for a lifetime pension. The monthly pension amount is calculated as the number of years of contributions multiplied by the last salary amount divided by 50. If the employee has not completed 20 years of contributions, they receive the total amount of contributions made to the fund, plus accrued interest in the form of a lump sum grant.
A universal social assistance scheme provides a social allowance for senior citizens 68 years of age or older (60 years for Dalits and single women). It is funded by the Government of Nepal.
In Nepal, if an employee who has completed 20 years of service dies, their survivors are paid a family pension in the amount of 50% of the pension the employee was entitled to receive. Survivors include spouses and minor children under the age of 18 years.
Widows under 60 years of age who cannot work also receive social assistance allowance of NPR 2,000 per month funded by the government.
Employers must provide insurance coverage of at least NPR 700,000 (Nepalese rupees) to their employees against work accidents. In case of an employee's death due to a work-related accident, their survivors receive 100% of the sum insured as a lump sum benefit.
The Employee Provident Fund of Nepal does not cover pensions due to disability. It covers employees' medical treatment expenses up to a maximum of NPR 100,000 (Nepalese rupees) if workers have paid contributions for at least six months. If an employee leaves employment due to disability before reaching retirement age, they will be granted the total amount in their provident fund. A maximum of NPR 1,000,000 is paid in case of fatal diseases.
There is a social assistance allowance of NPR 3,000 per month for citizens with a total and permanent disability. Citizens with partial disability are entitled to receive NPR 1,200 per month.
Compensation for disability due to work accidents or diseases is paid by employers, depending on the degree and type of disability.
In Nepal, it is prohibited to employ a child under 14 years of age in any type of work. Employers must obtain approval from the Labour Office and parents or guardians of children before employing minors. Minors must undergo a medical examination to prove their fitness for the job.
Work hours of children between 14 and 16 years must not exceed 6 hours per day and 36 hours per week. Children younger than 16 cannot be employed in hazardous work. Also, children must be provided with a rest break of 30 minutes after working continuously for 3 hours. It is prohibited for children to be employed in any job between 6:00 PM and 6:00 AM.
Minors are also entitled to 1 day of paid home leave for every 20 days of work done by them. They receive 24 days of fully paid sick leave, 10 days of education leave, and 30 days of special leave per year.
Unemployment 10.7%
Share of the labor force that is unemployed, but available for and seeking employment © 2024 - WBG • ILO
39.8%
Labor force population share
37.2%
Female share of labor force
54%
Healthcare access
Unemployment: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025.
Labor force (total): The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Labor force population share: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025
Female share of labor force: The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Healthcare access: The World Bank: World Development Indicators: World Bank Group • GHO, WHO (WHO), uri: https://www.who.int/data/gho/data/themes/topics/service-coverage
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