Employer Governance Resets under Bangladesh’s 2025 Labour Amendment

On 20 January 2026, the Government of Bangladesh, in a notification, announced the constitution of a Committee[1] to make recommendations on the revisions to the Bangladesh Labour (Amendment) Ordinance, 2025 (Ordinance)[2]. The Ordinance which recently gained effect on 17^th November, 2025, primarily aims at aligning the Bangladesh labour laws with the International Labour Organization (ILO Standards). While further revisions may follow once the Committee begins its work, this blogpost focuses on the changes that impact businesses in Bangladesh, and the governance resets employers should implement to align with the Ordinance.

1. Expanded definition of Worker: The definition of worker has been widened by removing the earlier ambiguities with respect to inclusion of certain categories of workers. Persons employed as an officer in an establishment, industry are now considered as workers. However, the managing or chief executive or administrator or any person entrusted in writing with the administrative or supervisory functions of an establishment are excluded from the definition of worker.
2. Compensation for lay-off: As per the new eligibility criteria for compensation on lay off, workers who have completed 3 months of continuous service under the same employer and whose name in included in the worker’s register can claim compensation upon lay-off. If the period of lay-off exceeds 45 days in a year, employers must pay half of total of the basic wages instead of the erstwhile one-fourth of total wages and dearness allowance and ad-hoc or interim pay, if any and the full amount of housing allowance, if any to the concerned worker.
3. Leave structure: As per the new leave structure, employers must provide 1 day earned leave to workers for every 14 days (earlier 18 days) work and festival leave of at least 13 days (earlier 11 days) in a year.
4. Compensation for resignation: As per the latest amendments, permanent workers who have completed 3 years of continuous service are eligible for compensation upon their resignation according to the following tiers:
   • Service duration for continuous 3 years, the compensation will be 7 days wages for every completed year of service.
   • Service duration which is more than 3 years but less than 10 years, the compensation will be 15 days wages for every completed year of service.
   • Service duration, which is more than 10 years, the compensation 30 days wages for every completed year of service or gratuity whichever is higher.
5. Maternity benefit: Previously, maternity benefit could be availed by giving 8 weeks’ notice prior to childbirth, for 8 weeks before delivery and 8 weeks after delivery and 8 weeks post-delivery in case the notice is given post childbirth, which could be modified by mutual discussion. Under the latest amendment, female workers are now entitled to 60 days paid leave prior to delivery and 60 days paid leave post delivery (in case she notifies her employer prior to childbirth) and upto 120 days paid leave post delivery (in case she notifies her employer post childbirth). The notice period to avail the benefit has been increased from 8 weeks to 60 days.
6. Provident fund: Provident fund, which was voluntary has now become mandatory for all private organisations.

Other than the amendments to the existing provisions, the Ordinance has introduced new obligations for employers. They are as follows –

1. Prohibition on blacklisting: If any worker or union member is terminated for any reason, employers should not issue or include in the database any notice blacklisting the worker.
2. Prohibition on forced labour: Employing any worker or assist in the employment of a worker in forced or compulsory labour is now a punishable offence under the Bangladesh Labour Act.
3. Prevention of workplace discrimination, violence and harassment: Discriminating against workers or causing violence or harassment to them is an offence. The Ordinance mandates employers to establish a discrimination, violence and harassment complaints redressal committee to deal with complaints related to these issues. The committee should consist of 5 (five) members, where majority of the representatives from the institution should be from among the female employees and the head should be a female. 2 (two) members of the committee should be drawn from institutions working on gender and sexual harassment issues.
4. Inclusion of modern-day disease: Modern day diseases like computer vision syndrome, musculoskeletal disorder (MSD), stress, depression, allergies, respiratory problem etc. are now considered as occupational diseases. Employers must take measures to check the health conditions of their workers.

What employers must do?

Given that the Ordinance is already in effect, employers who have not yet aligned their policies and procedures should take immediate steps to adhere to the new regulatory changes. Employers should take the below mentioned steps –

• Keep the workers register updated and review it periodically.
• Modify payroll and compensation policies to comply with the latest regulatory requirement.
• Reassess insurance coverages, compensation reserves for workers and minimise risk exposure while conducting high-risk work.
• Revisit their leave policy to ensure that employees get at least 13 festival leaves in a year and 1 earned leave for every 14 days of work.
• Establish a provident fund for workers, set up a contribution structure, establish a board of trustees with equal number of representatives from both the employers and the workers and ensure timely payment of contribution.
• Revise their HR policies to provide compensation upon resignation to employees who have been in continuous service for 3 years under the same employer.
• Revisit maternity benefit policies and sensitize employees about their rights and duties.

Conclusion

The Ordinance increases employee benefits, rights and mandates establishment of social security mechanisms in the private sector. While we can expect further regulatory changes to the labour laws in view of the Committee being constituted, businesses in Bangladesh should align their policies, processes and governance mechanisms to ensure a fair, safe and inclusive workplace and avoid heavy penalties.

Our compliance management solution Komrisk can help your organisation stay compliant with the regulations and stay updated with the changing laws and compliances.

Author: Debasish Banerjee

Co-Author: Antara Dasgupta

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[1] https://www.dpp.gov.bd/upload_file/gazettes/59906_93694.pdf

[2] https://www.dpp.gov.bd/upload_file/gazettes/59278_24645.pdf