Procloz
Get Started

Manage Employment in Bangladesh Without the Hassle

Services available in this country:

  • Employer of Record Services
  • Local Payroll Solutions
Overview:
Bangladesh, situated in South Asia, ranks as the eighth-most populous country in the world and is among the most densely populated nations globally. Bordered by India on the west, north, and east, and sharing a southeastern frontier with Myanmar, it also boasts a strategic coastline along the Bay of Bengal. Despite its relatively small land area, Bangladesh plays a significant geopolitical and economic role in the region.

Risks of misclassification

Bangladesh, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Bangladesh may lead to fines and penalties for the offending company.
Get Compliant Now
Hiring:
Recruitment practices in Bangladesh largely mirror global trends, with online job portals and professional networking being the most common channels for talent acquisition. However, for foreign employers or companies newly entering the Bangladeshi market, building local connections can be a challenge. In such cases, partnering with a local entity or Employer of Record (EOR) can significantly streamline recruitment, ensuring access to relevant talent pools and compliance with local hiring norms.
Interview:
Interviews in Bangladesh tend to be formal and structured, often starting with questions about educational background and previous work experience. Employers may place a strong emphasis on academic credentials and English language proficiency, especially for roles in multinational organisations or export-oriented industries. It’s also common for employers to evaluate a candidate’s adaptability, loyalty, and willingness to work in hierarchical environments.
Remote interviews are becoming more common, particularly in the post-pandemic landscape, but in-person meetings are still preferred for final rounds. For overseas employers, using an EOR can help coordinate local interview logistics and pre-screen candidates for a better cultural and professional fit.
Application Process
A well-structured CV accompanied by a personalised cover letter is crucial in the Bangladeshi job market. These documents are often the first point of contact between the candidate and the employer, and they significantly influence shortlisting decisions.
Recruiters look for clarity, relevance, and alignment with the job description – making it essential for applicants to tailor their application materials to highlight qualifications, relevant experience, and long-term career goals.
Employment:

Working Hours: Standard working hours are 8 hours per day, Sunday to Thursday, totalling 40 hours per week. Shifts over 6 hours must include a 1-hour lunch break; those over 5 hours require a 30-minute break.

Probation Period: The minimum probation period is 3 months, extendable up to 6 months. Extensions must be formally communicated in writing. Without such notice, the employee is automatically considered confirmed.

Payroll Cycle: Typically runs monthly, from the 1st to the 30th of each month.

Salary Deductions: Common deductions include professional tax, provident fund (PF), income tax, insurance, entertainment allowances, and other statutory components.

Public Holidays: Bangladesh has 21 national holidays, but employers must provide 11 paid holidays per year. The selection of these days is at the employer’s discretion.

Leave Entitlements

    • Casual Leave: 10 days per year (non-carry forwardable)
    • Sick Leave: 14 days per year, with medical certification required
    • Maternity Leave: 16 weeks of fully paid leave (8 weeks before and after childbirth); 6 months for government employees
    • Earned Leave: 1 day for every 18 days worked; unused leave must be encashed
Payroll:

Payroll in Bangladesh is calculated based on an employee’s basic salary, with adjustments for allowances and mandatory deductions.

Basic Salary = Gross Salary – Allowances
(Allowances may include medical insurance, HRA, dearness allowance, conveyance, etc.)

Key Components of the Salary Structure: A standard salary package comprises various components such as taxable income, provident fund contributions, allowances, and statutory deductions. These elements help determine both the employer’s liability and the employee’s net income.

Payroll Cycle

  • Monthly-paid employees must receive salaries by the last working day of the month.
  • For those on hourly, daily, or weekly wages, payments must be disbursed every two weeks.

13th Month Salary (Festive Bonus)
After completing one year of service, employees are entitled to two festive bonuses annually. These are typically equivalent to the basic salary or 50% of gross pay, depending on the employer’s policy.

Overtime Policy
Employees may work overtime up to a maximum of 60 hours per week, with an annual average capped at 65 hours. Overtime compensation is paid at twice the normal hourly rate.

Onboarding in Bangladesh
Onboarding is relatively straightforward, given the flexibility of local employment laws. To ensure a smooth start, employers should:

  • Review the employee contract
  • Share the offer letter
  • Explain the company’s code of conduct and policies on the first day

Proper onboarding sets the tone for a productive and compliant work relationship.

Business Setup:
Starting a business in Bangladesh involves meeting specific legal and regulatory requirements. Below is a summary of the steps and approvals needed for company formation and registration.

Key Requirements for Starting a Business

To legally establish a company in Bangladesh, the following are typically required:

  • RJSC (Registrar of Joint Stock Companies and Firms) approval
  • Local bank account with a recognised Bangladeshi bank
  • Trade license from local authorities
  • Tax Identification Number (TIN) and Business Identification Number (BIN)
  • Non-residential office address
  • Factory blueprint and layout (for manufacturing businesses)
  • Import/Export license (if applicable)
  • Fire safety certificate (for offices/factories)
  • Sector-specific approvals, such as from BTCL for telecom-related businesses
Company Registration Process

Step 1: Name Clearance

Start by securing name clearance from the RJSC. The proposed business name must be approved before registration.

Step 2: Documentation

Prepare the Memorandum of Association (MoA) and Articles of Association (AoA) along with other required documents.

Step 3: Bank Account Setup

Open a bank account in the company’s name. If you plan to hire foreign employees, an inward remittance of at least USD 50,000 is required.

Step 4: Document Submission to RJSC

Submit all documents along with the registration fee to the RJSC. Upon approval, you’ll receive the Certificate of Incorporation.

Step 5: Obtain Additional Licences

Post-registration, secure the necessary operational licences to remain compliant:

  • Trade Licence
  • Tax Identification Number (TIN)
  • VAT Registration Certificate
  • Fire Safety Certificate
  • Environmental Clearance Certificate (if relevant to your business)

Procloz offers cost-effective HR & Payroll solutions for businesses of all sizes.

Customized solutions that are as unique as your business. Discover how Procloz can help you manage your workforce more effectively.

Lets Get Started
Procloz