Bangladesh Labor Guide 2020 Overview
This is a labor and employment operations guide for Korean companies operating in Bangladesh. It explains core labor regulations—including the Labor Act of 2006 (revised in 2018), minimum wage, working hours, occupational safety, foreign employee hiring, and labor relations—and provides practical responses to issues Korean firms commonly encounter.
Employment Contracts and Working Conditions
The labor law distinguishes between regular, contract, and daily-wage workers and requires written employment contracts. Probation can last up to six months (three months for skilled workers). Dismissal requires 120 days prior notice or equivalent salary compensation, and gratuity is one month's salary for each year of service.
| Item | Regulation | Remarks |
|---|---|---|
| Working Hours | 8 hours/day, 48 hours/week | Overtime limit: 56 hours/month |
| Overtime Pay | 200% of normal wage | No more than 60 overtime hours/week |
| Annual Leave | 18 days after 1 year | Paid |
| Sick Leave | 14 paid days/year | Medical certificate required |
| Maternity Leave | 16 weeks (paid) | Statutory |
| Probation | 6 months (3 months for skilled) | One renewal possible |
| Dismissal Notice | 120 days written notice | Or salary compensation |
| Gratuity | 1 month salary per year | Based on 30-day wage |
Minimum Wage and Compensation Structure
Minimum wage levels are decided by sector-specific wage boards. In the garment sector, the monthly minimum is 8,000 BDT ($95), and the post-2019 revision in many areas applies the 12,500 BDT ($148) rate. Wages vary by sector, so Korean firms should align compensation with current local market levels for competitiveness and retention.
Industrial Safety and Compliance
Following the 2013 Rana Plaza collapse, with 1,134 fatalities, Bangladesh significantly strengthened industrial safety regulations. For garment factories, Accord and Alliance safety audits, fire and evacuation standards, and RCC structural inspections are now mandatory.
Foreign Worker Employment Rules
| Item | General Area | Economic Zone | Remarks |
|---|---|---|---|
| Foreign Worker Ratio | 5% | 20% | Share of total headcount |
| Work Permit | Issued by BIDA | Issued by BEZA | 1-2 years, renewable |
| Tax | 30% income tax | 30% income tax | Same for non-residents |
| Salary Remittance | 50% home-country remittance | 100% remittance | Zones are favorable |
| Visa | Employment Visa E | Employment Visa E | Issued through embassies |