Provident Fund to Group Health Run for Your Own Entity
For companies that already hold a Bangladesh entity, and one of five managed HR services we run here: we administer statutory and supplementary employee benefits accurately, on time and audit-ready, so your HR team spends its week on strategy rather than on spreadsheets and bank files.
Employee benefits administration in Bangladesh is not one job. It is a festival bonus calculated on a basic wage that is not the salary you agreed, a provident fund ledger that has to reconcile to the taka, an end-of-service figure whose computation base practitioners still argue about, and an insurance enrolment that has to hold when someone is admitted to hospital on a Friday. Your entity carries all of it. We do the running.
Administration aligned with the Bangladesh Labour Act 2006 as amended in 2026
Benefits Administration for Companies With Their Own Entity
Most benefits content in this market is written for companies that do not have an entity yet, because that is the easier sale. This page is not. It is for the HR or finance lead who already has a registered Bangladeshi company, already signs the employment contracts, and needs the benefits engine underneath those contracts to run without consuming a headcount.
Where we fit: you hold the entity, we run the engine
You remain the employer of record for your own people. Nothing about the employment relationship moves. What moves is the administration — the calculation, the calendar, the paperwork and the evidence trail — onto a team that does it for a living and is in the same time zone as your staff.
- The entity and the employment contracts. Your company stays the legal employer throughout.
- Benefit policy and budget. The basic-to-gross split, the cover level, whether a fund exists at all.
- Approvals. Every payment file and every enrolment is released by you before it moves.
- Your banking. Disbursement runs from your account, not through ours.
- Calculation and the calendar. Bonus, accrual, matching and settlement arithmetic, dated to when each item falls due.
- Insurer liaison. Plan design, enrolment, life-event changes and claims chasing with licensed insurers.
- The employee helpdesk. A named contact your staff can reach in Bangladesh working hours, in Bangla and English.
- The evidence. Registers, consents, remittance proofs and a monthly pack an auditor can open cold.
Already hiring through an Employer of Record? Benefits are included
If you do not have a Bangladeshi entity, this is not the service you need. Benefits administration is already inside our Employer of Record service, where we are the legal employer and the statutory items are ours to carry. This page exists for the other case: the entity is yours, and so is the liability.
Statutory Benefits Under the Bangladesh Labour Act 2006
The Labour Act 2006 was amended by the Labour (Amendment) Ordinance 2025, in force 17 November 2025, and then by the Labour (Amendment) Act 2026 of 10 April 2026, which repealed the Ordinance and softened several of its terms. A good deal of the benefits guidance still circulating online predates both. The table below is the position we administer to, with the section carried beside each row so your counsel can check us rather than take our word for it.
Every Entitlement With the Section It Comes From
| Statutory item | What the entitlement is | Who qualifies | Reference |
|---|---|---|---|
| Festival bonus | Two a year, each capped at one month’s basic wage, paid on top of wages | Workers with one year’s continuous service | Rules 2015 r.111(5) |
| Casual leave | 10 days a year at full pay, no carry-forward | Workers | s.115 |
| Sick leave | 14 days a year at full pay, on a certificate from a registered medical practitioner | Workers | s.116 |
| Earned leave | One day for every 18 days worked, after one year of service | Workers | s.117 |
| Festival holidays | 13 paid days a year; a holiday worked earns a substitute day plus two days’ wages | Workers | s.118 |
| Maternity benefit | 120 days at full pay, 60 before and 60 after delivery; daily rate is monthly wage divided by 26 | Women workers with six months’ service | ss.46–50 |
| Overtime and rest | 8 hours a day and 48 a week; overtime at twice the basic rate; a weekly rest day | Workers | ss.100–108 |
| Provident fund | Not automatic. Where a fund exists, a permanent worker contributes 7–8% of monthly basic and the employer matches it | Permanent workers where a fund exists | s.264 |
| End-of-service pay | Tiered by who ends the employment and after how long; a gratuity scheme is paid instead where it is higher | Permanent workers | ss.2(10), 26, 27(4) |
| Group insurance | Required under prevailing insurance law; claims to be settled within 120 days | Establishments of 100 or more permanent workers | s.99 |
Where the Sources Disagree
Where sources disagree, and on provident fund compulsion and the computation base for end-of-service pay they genuinely do, we will not pick the convenient reading and leave you to discover it. You get the enacted text, the commentary that contradicts it, and the reading we apply, in writing, before it reaches a payslip.
Festival bonuses
The rule sets a cap of one month’s basic wage per bonus, not a fixed month’s pay, and it names no festival. Dhaka practice is to pay at the two Eids, and foreign employers in the market generally pay managers as well as workers to avoid an obvious two-tier office. Because the cap sits on basic rather than gross, your basic-to-gross split decides the cost of this line before anyone negotiates anything. We calculate on your split, on your festival calendar, and we tell you the accrual monthly instead of surprising you twice a year.
Gratuity and end-of-service pay
There is no duty to run a gratuity scheme. There is a duty to pay end-of-service money, and the amount depends on whether the employer ended the employment or the person resigned, and on completed years of service. Where a scheme exists and pays more, the scheme figure applies. The base on which it is computed is contested between practitioners, which is why we state the base in your documentation and hold the accrual visibly rather than discovering it at an exit interview.
Provident fund administration
A fund is optional in law and common in the market. Running one properly means member registration at hire, a deduction that reconciles to the payslip, employer matching, a trustee record that survives an audit, and a settlement at exit that pays the right person the right figure. We keep the ledger, produce the member statements, and hand you a remittance file you approve before anything leaves your account. Deductions each cycle sit alongside your payroll management run; the withholding that goes with them is covered in tax and statutory compliance.
Maternity benefit and leave accounting
Maternity benefit is a cash calculation on a divided monthly wage, not simply paid time off, and it interacts with the leave ledger you are already keeping. Earned leave accrues at one day per 18 worked and carries forward within limits; casual leave does not carry at all. Two different accrual rules and a cash benefit in the middle of them is where hand-kept leave spreadsheets fail. Day-to-day record keeping around this sits with HR administration, and the joining and leaving paperwork with employee onboarding and offboarding.
Group Health Insurance Through IDRA-Licensed Insurers
We are not an insurer and we do not underwrite anything. Group health and life cover for your staff is placed with insurers licensed by the Insurance Development and Regulatory Authority, and the policy is issued to your entity. What we do is the part that eats an HR week: getting comparable quotes, translating them into a plan your people will actually understand, and then keeping the enrolment accurate every month so that a claim is not refused because a dependant was never added.
Plan design and broking through licensed partners
Group cover here is written per life and no insurer publishes a rate card, so any figure quoted before an insurer has seen your census is a guess. Minimum group sizes commonly start between five and fifteen lives, and some insurers require every eligible employee to enrol rather than allowing opt-in. In-patient limits and daily room caps on locally written plans are modest by European or North American standards; richer cover exists and costs more. Tell us the level you intend to promise a hire and we bring back quotes that meet it, or tell you plainly that it is not available at your headcount.
Enrolment and claims support
- Census and enrolment. Joiners added before their first payslip, leavers removed the day they leave, dependants captured at the point the employee tells us rather than at renewal.
- Life-event changes. Marriage, a new child, a change of dependant status, a mid-year upgrade — each one routed to the insurer with the evidence it needs.
- Claims chasing. Your employee talks to a person in Dhaka, not to an inbox in another time zone, and we keep the file moving until it settles.
- Renewal on evidence. Claims experience and utilisation summarised before renewal, so the next negotiation is informed by your own numbers.
Premiums are invoiced to you at cost. Nothing is marked up inside the premium line, because a benefits administrator who takes a margin on the insurance has an interest in the plan you buy, and we would rather have an interest in the plan you keep.
Enrollment Claims and Employee Support
Benefits fail at the seams: the joiner who is not on the policy in week one, the address change that never reached the fund, the resignation settled from a spreadsheet nobody has opened in a year. A joiner needs a fund number, an insurer enrolment, a leave opening balance and a correct payslip before the first pay run; a leaver needs the mirror of all four. The administration below is built around those seams rather than around a monthly cycle.
The event happens
A hire signs, a child is born, someone resigns, an employee is admitted to hospital. Your manager or the employee tells one named contact, in Bangla or English, in Bangladesh working hours.
Every dependent record moves
Payroll, the leave ledger, the fund register and the insurer enrolment are updated from the same event, not from four separate emails, so they cannot drift apart.
The evidence is filed
Consent, certificates, insurer confirmations and remittance proofs are stored against the employee record, dated, and appear in the next monthly pack.
An employee helpdesk your staff will actually use
Most benefits questions are small and urgent: is my spouse covered, how many sick days do I have left, when does the bonus land, why did this deduction change. Left unanswered they arrive at your HR lead in a batch. Your staff get a named contact and a working-hours channel, and you get the volume and the themes in the monthly report instead of the questions themselves.
Compliance Reporting and Audit Readiness
A benefits programme is only as good as what you can show. Bangladeshi statutory inspection, a group audit and a due-diligence exercise all ask the same question in different words: prove that the entitlement was calculated correctly, paid on time, and consented to. That is a documentation problem, and it is far cheaper to solve monthly than retrospectively.
The statutory pack
Fund contributions and matching, leave movements, insurance enrolment changes, accruals carried for bonus and end-of-service, and the withholding position, with the payment evidence attached.
Bonus run
Bonus calculated on your basic split against a service-qualification list, released by you, paid on the calendar you set rather than on the week it is remembered.
Audit file and renewal
A year-end file that reconciles registers to payments, plus claims and utilisation summarised in time to negotiate the insurance renewal on evidence.
Settlement
Fund balance, leave encashment and the end-of-service tier computed on the base stated in your documentation, with the working shown to the employee and to you.
Health and benefits data stays in Bangladesh. The Personal Data Protection Act 2026 treats health information as sensitive personal data and restricts cross-border transfer of national identity documents. In practice that means medical statements, maternity records and claim detail stay with the insurer and with us in Dhaka; what reaches your head office is enrolment status, dates and cost, never a diagnosis. Consent for insurance enrolment is taken separately from the employment contract, and national ID and TIN copies collected at onboarding are not sent abroad to set up a benefit.
How Long Does It Take to Take Over an Existing Benefits Program?
Most companies asking this question already run benefits, badly or expensively, and are mid-policy-year. You do not have to wait for a renewal date, and you should not have to switch insurer to switch administrator.
| Stage | What happens | Typical elapsed time |
|---|---|---|
| Assessment | We read your contracts, current policy schedule, fund rules and last three months of payroll, and come back with what matches the Act and what does not. | Within the first two weeks |
| Parallel run | We recalculate a full cycle alongside your existing process and reconcile every variance line by line before anything switches. | One full pay cycle |
| Cut-over | Registers, balances and enrolments transfer with an opening position you have signed off. Your insurer and your bank relationships do not move unless you want them to. | The following cycle |
| Steady state | Monthly pack, festival calendar loaded, renewal diarised, helpdesk live for your staff. | From month three |
The wider cost picture, including what the statutory items add on top of salary, is broken down in our guide to employer costs in Bangladesh, and the salary structure that drives every one of those figures in mandatory salary components. EOR BD is operated by Eicra Soft Limited from JCX Business Tower, Bashundhara R/A, Dhaka, and visitors are welcome.
Frequently Asked Questions
Which employee benefits are legally mandatory in Bangladesh?
For a worker under the Labour Act 2006 as amended: two festival bonuses after one year of continuous service, each capped at one month’s basic wage; 10 days’ casual leave and 14 days’ sick leave; earned leave at one day per 18 worked; 13 paid festival holidays; 120 days’ maternity benefit; overtime at twice the basic rate; and end-of-service pay. A provident fund is not automatic. Group insurance applies to establishments of 100 or more permanent workers. Health insurance is not mandatory at any size, which is precisely why almost every foreign employer in Dhaka offers it anyway.
Do you provide the insurance yourselves?
No. EOR BD is not an insurer and does not underwrite risk. Cover is placed with insurers licensed by the Insurance Development and Regulatory Authority and the policy is issued to your entity. We handle plan design, quotation, enrolment, life-event changes, claims support and renewal analysis, and the premium is invoiced to you at cost with no margin added inside it.
Can you take over an existing benefits program mid-year?
Yes, and mid-year is the normal case. You do not need to wait for a policy renewal and you do not need to change insurer to change administrator. We run a full cycle in parallel with your existing process first and reconcile every variance before cut-over, so any historic error surfaces in writing while you are still free to walk away.
How do you handle provident fund administration?
A fund is optional under section 264 — an establishment may constitute one — and where it exists the standard arrangement is a member contribution of 7 to 8% of monthly basic with an employer match. We handle member registration at hire, the deduction reconciled to the payslip, employer matching, trustee-grade records, member statements and the settlement at exit. Payment files are prepared for your approval and disbursed from your account; we do not hold your money.
What reporting do we receive each month?
A single pack covering fund contributions and matching, leave movements and balances, insurance enrolment changes, the accruals carried for festival bonus and end-of-service, and the withholding position, each with payment evidence attached. It is written to be opened cold by an auditor or a group finance reviewer, not to be interpreted by whoever prepared it.
Is festival bonus mandatory in Bangladesh, and how much is it?
Yes, for workers with one year’s continuous service: two bonuses a year, each capped at one month’s basic wage under rule 111(5) of the Labour Rules 2015. The rule sets a cap rather than a fixed amount and it names no particular festival. Dhaka practice is to pay at the two Eids. Because the cap is calculated on basic and not on the gross salary you agreed with the employee, your basic-to-gross split determines what this line actually costs you.
How is gratuity calculated in Bangladesh?
Gratuity is 30 days’ wages at the last drawn rate for each completed year of service, rising to 45 days per year where service exceeds ten years, and it is paid where a scheme exists or where it is higher than the statutory end-of-service entitlement. There is no legal duty to operate a scheme. Whether “wages” means basic alone or all cash remuneration is contested between practitioners, and the difference is material, so we state the base explicitly in your documentation rather than leaving it to be discovered at an exit.
Do managers and team leads get the same statutory benefits as workers?
Only if they are workers under the Act. The exclusion attaches to people given managerial, administrative or supervisory responsibility, and commentaries disagree on whether the test is the written designation or the person’s actual function. The practical consequence is the same either way: a team lead with no designation letter is a worker with every statutory entitlement, and a letter cannot take someone doing technical or clerical work outside the Act. Our default is worker-level bonus, leave and maternity terms for every employee regardless of title unless you instruct otherwise in writing.
Let us run your Bangladesh benefits program