Employer of Record (EOR) in Bangladesh
An employer of record is the legal employer of your staff in Bangladesh, while you direct the daily work. PayrollBD signs the local employment contract, runs the monthly payroll and deducts tax at source. The statutory records stay with us, so a foreign company can hire here before registering its own entity.
What is an EOR in Bangladesh?
An EOR in Bangladesh is a locally registered employer that hires staff for a foreign company under Bangladeshi employment law. PayrollBD holds the employment contract, pays the salary and files the deductions. Your team keeps control of the work itself.
The arrangement suits a company that wants people in Dhaka before it wants a branch office. Hiring, payroll and exit paperwork stay inside one local employer, and our payroll outsourcing services carry the monthly cycle.
Which employer duties PayrollBD carries
Three duties define an employer of record engagement: the employment contract, the monthly payroll cycle, and the records that prove both were done. PayrollBD carries all three under Bangladeshi law, with a named owner for each step, so nothing sits between your instruction and a filed document.
What the engagement includes
The scope is fixed in writing before the first hire, so both sides know what is delivered and what stays in your hands. Nothing is added without a written amendment, and the four elements below are always included in an employer of record engagement.
- Local employment contract — drafted against the Bangladesh Labour Act, 2006 and signed by PayrollBD as employer.
- Monthly payroll run — gross-to-net calculation, salary disbursement and a payslip for every employee.
- Statutory deductions — tax at source on employment income, supported by our income tax filing consultancy.
- Record custody — service records, wage registers and leave registers kept ready for inspection.
- Payroll data handling — employee and salary records held under the service agreement, with access limited to named payroll staff.
Recruitment, equipment and daily work direction remain with your company.
Who is accountable under Bangladesh law
Accountability splits in two. PayrollBD is the employer of record on paper and answers for wages, deductions and records, while your company directs the work and funds it. The table sets each duty beside the rule that creates it and the party that performs it.
| Employer duty | Statutory rule | Section cited |
|---|---|---|
| Wage payment date | Wages paid before the expiry of the seventh working day after the wage period ends | Bangladesh Labour Act, 2006, section 123 |
| Resignation notice | Sixty days in writing from a permanent worker | Bangladesh Labour Act, 2006, section 27 |
| Termination benefit | Thirty days of wages for each completed year of service, or gratuity if higher | Bangladesh Labour Act, 2006, section 26 |
| Probation length | Three months for most roles and six months for clerical work | Bangladesh Labour Act, 2006, section 4 |
Where a duty sits with PayrollBD, the evidence of it returns to you in the same month. The Bangladesh Labour Act, 2006 is published by the Ministry of Law and administered by the Department of Inspection for Factories and Establishments.
Tax at source on salary is deducted under the Income Tax Act, 2023 and deposited with the National Board of Revenue. The same Act, as amended in 2013, is indexed by the International Labour Organization in its NATLEX record for Bangladesh. Reviewed by Eicra Binte Islam
When does an EOR fit best?
An employer of record fits when you need people in Bangladesh sooner than an entity can be registered. It also fits when the headcount is small enough that a branch office would cost more than the work returns, and when remote staff recruitment is part of the plan.
- Testing the market before committing to a registered branch.
- Hiring a small remote team that still needs a local payroll.
- Working under labour rules your own team does not administer.
- Moving employment administration off an in-house finance desk.
How onboarding runs, step by step
Onboarding runs in four fixed stages, and each stage ends with a document so the next one cannot start on an assumption. The sequence is the same for a single hire and for a team, and the calendar is agreed before stage one begins.
- 1Scope and service agreement — roles, salary structure, start dates and signing authority are confirmed.
- 2Contract and onboarding — PayrollBD issues the appointment letter and opens the service record.
- 3Monthly payroll run — gross-to-net calculation, disbursement, payslips and deduction schedules.
- 4Filing and reporting — deductions are deposited and the record set goes to your finance team.
Which buyer does this fit?
Three buyer situations bring companies to an employer of record in Bangladesh, and the paperwork differs in each one. Each block below names the situation, what PayrollBD carries inside it, and where your own team stays in charge of the work.
Foreign company with no entity yet
A company hiring in Bangladesh before registration needs a legal employer on the contract from day one. PayrollBD signs that contract, runs the payroll and deducts tax at source, while your managers direct the work. Nothing waits on a trade licence or a bank account in your own name.
- Employment contract issued under Bangladeshi law by PayrollBD.
- Salary paid inside the statutory wage window each month.
- Deduction schedules and service records handed to your finance team.
Local employer moving payroll out
A Bangladeshi company that already employs people can move the administration without moving the employment. PayrollBD runs the monthly cycle, the deduction schedule and the record set, and the employment contract stays exactly where you want it. The split is written down before the first cycle runs.
- Monthly gross-to-net calculation and payslip issue.
- Tax at source deducted when the salary is paid.
- Wage registers and leave registers kept ready for inspection.
Small headcount of one or two hires
One hire carries the same statutory duties as twenty, which is why a single appointment is often the hardest to administer in-house. An employer of record absorbs that duty set for a small team, and the same documents are produced whether the headcount is one person or a full department.
- Identical contract, payroll and filing steps at any headcount.
- One point of contact for onboarding and exit paperwork.
- No entity registration needed to place the first employee.
EOR, own entity or payroll only
Three routes exist for putting staff to work in Bangladesh, and the difference between them is who signs the employment contract. The table compares what each route requires before the first salary can be paid, so the choice is made on paperwork rather than on preference.
| Engagement route | Who employs the staff | What it needs first |
|---|---|---|
| Employer of record | PayrollBD signs the employment contract | A service agreement and the role details |
| Your own entity | Your registered company signs it | Registration, licences and a local bank account |
| Payroll processing only | Your company remains the employer | An existing entity plus monthly payroll data |
Where the entity does not exist yet, the first route is the one that places a person this month. Where it already exists, the third keeps employment in-house and moves only the calculation work.
Ready to hire in Bangladesh?
PayrollBD works with foreign and local employers who need staff on the ground in Bangladesh without opening an entity. Tell us the roles, the start date and the salary band. You then receive a scoping call, a written scope of work and the cost basis before anything is signed. One local employer of record carries the paperwork while your managers keep the work.
What the compliance work covers
Three areas carry the statutory weight of an engagement, and each one is worked in a fixed rhythm.
Compliance work starts with the wage calendar. Wages are paid within seven days of the wage period ending, and tax at source is deducted when the salary is paid. PayrollBD holds the schedule and the proof of each deposit.
Nothing in the cycle depends on a reminder from your side. The calendar is issued at the start of the engagement and reissued whenever a statutory date moves.
Your company sets the commercial terms and PayrollBD signs the employment contract as employer of record in Bangladesh. Terms cannot fall below the statutory floor on notice, termination benefit and wage timing.
Amendments are issued in writing and filed with the service record, so the contract and the record never disagree.
An employer of record does not remove every registration need. A company that must sign local commercial contracts, hold a licence or own property still registers its own presence in Bangladesh.
We say so before an engagement starts, and payroll processing solutions continue either way.
What employers ask before signing
Four questions decide most engagements, and the answers do not change with the size of the team.
How do we know which benefits a worker must receive?
The statutory floor decides it. Bangladeshi law fixes the minimum on wage payment timing, notice periods and termination benefits, and an employment contract cannot offer less than that floor. PayrollBD maps each role against it first, then adds whatever your own policy provides on top. You receive the mapping in writing before the contract is signed, so the full cost of a hire is known before onboarding starts.
Do you employ our workers directly in Bangladesh?
Yes. PayrollBD is the employer of record on the contract, which places the appointment letter, the payroll and the statutory deductions with us. Your managers still choose the person, set the targets and direct the daily work. The split is written into the service agreement so responsibility is never assumed: employment administration sits with PayrollBD and work direction stays with you.
Can you also recruit the people we need?
Recruitment is a separate service from employer of record and is quoted separately. We can source and shortlist candidates for the roles you define, then move the chosen candidate straight into onboarding as an employee on our records. Where you already have a candidate, sourcing is skipped and the work starts at the contract stage. Both routes end in the same employment record.
How many workers do we need to start?
There is no minimum headcount. A single employee in Dhaka is engaged the same way as a team of twenty, because the contract, payroll and filing steps do not change with volume. The honest limitation lies elsewhere: an employer of record does not replace registering your own entity. That step stays with you where your company signs local commercial contracts, holds a licence or owns property in Bangladesh.