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August 2, 2023
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3 mins
Situated in South Asia, Nepal is bordered by India and China, and its economy primarily revolves around subsistence agriculture, employing approximately 65% of the working population. Overcoming poverty and dependence on remittances, Nepal has exhibited significant economic progress since the 1950s, driven by a series of strategic five-year plans.
When hiring an individual from Nepal, employers should familiarize themselves with the country's labor laws, statutory benefits, leave policies, and allowances. Here are essential considerations for employers seeking employees in Nepal.
The employment contract should be written in a language that the employee can understand or in English, ensuring that all important details regarding employment, including work hours, leave policies, bonuses, and job responsibilities, are clearly stated by the employer.
In Nepal, the probationary period for employees extends for a maximum duration of six months.
In Nepal, the standard payroll cycle is monthly, although it can be adjusted to a weekly or bi-weekly cycle based on a mutually agreed arrangement.
The minimum wage in Nepal is NPR 15,000 per month.
Overtime work in Nepal should be compensated at a rate of 150% of the regular pay.
In Nepal, there is no legal requirement for employers to provide a 13th Month pay as mandated by statutory law.
According to the regulations, employees in Nepal are entitled to one day of leave for every 20 days of work completed.
Upon completing one year of service, all employees in the company are eligible for 15 days of sick leave with half pay in Nepal.
Maternity leave in Nepal is granted for a duration of 52 days.
While not legally mandated, it is customary to provide 15 days of paternity leave in Nepal.
Employees who have completed one year of service are eligible for 13 days of mourning leave in Nepal.
Special leave in Nepal is granted for a period of 30 days.
In Nepal, the standard rate of VAT is 13%
Termination of the employment contract is possible for both the employer and the employee in Nepal.
The notice period in Nepal is determined through mutual agreement between the employer and the employee, in compliance with the labor laws of the country.
Employees in Nepal are entitled to receive severance pay from the first day of employment, calculated at a fixed rate of 8.33% of their basic remuneration.
Irrespective of their original location, foreign workers must initially obtain a work permit and Work Agreement from the Department of Labour to work in Nepal. Subsequently, they can apply for a work visa, allowing them to legally reside in the country for employment purposes.
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If you're considering hiring employees or contractors in Nepal or seeking compliant payroll solutions, reach out to us or book a demo at http://niural.com. For further insights, follow us on Twitter @niuralhq. Make informed decisions and ensure a successful hiring process in Nepal!
