HR and Payroll Compliance Tips

Payroll compliance in Bangladesh sits at the intersection of several different obligations at once: the Bangladesh Labour Act, NBR income tax withholding rules, and statutory contributions like provident fund and, for eligible companies, the Workers' Profit Participation Fund. Getting any single piece wrong doesn't stay isolated. It shows up in payslips, tax filings, and audit records all at once.

It's also worth knowing that 2026 brought real change here. The Labour (Amendment) Act, gazetted in February, lowered the registration threshold for provident fund obligations to establishments with as few as 20 workers, meaning many small and mid-sized businesses that were previously outside its scope now fall within it. If your headcount is anywhere near that threshold, it's worth checking your registration status rather than assuming last year's rules still apply.

Beyond registration, the core payroll fundamentals employers need to stay on top of include the standard 48-hour work week with defined overtime limits, accurate leave tracking including the extended maternity leave entitlements under the amended Act, and correctly calculated provident fund and gratuity deductions before net salary is disbursed. Two festival bonuses a year are also standard practice for most employers, aligned with major holidays.

The businesses that struggle here are usually the ones treating payroll as a once-a-month spreadsheet exercise rather than an ongoing compliance function. A single miscalculation in overtime or a missed update to leave entitlements doesn't just cost money to fix. It creates a compliance record that surfaces during inspection or audit.