Bangladesh Labour Act for Employees: What You Get When a Job Ends, Gratuity and Unpaid Wages

In this guide: What you get when a job ends · Gratuity: what it is and how to calculate it · Final settlement and unpaid wages · Grievance and the Labour Court · What changed in 2025 · Who the Labour Act does not cover

The short answer

If you are a “worker” under the Labour Act 2006, the law fixes what you get when your job ends. An employer who ends a permanent monthly-paid job without misconduct must give 120 days’ notice or pay instead, plus compensation of 30 days’ wages for each completed year or gratuity, whichever is higher. All dues must be paid within 30 working days. If they are not, send a written grievance and then go to the Labour Court. Senior managers and government employees are usually outside the Act and rely on their contracts.

What you get when a job ends

Compensation needs at least one year’s continuous service. Unused earned leave is paid on top. A dismissal without a charge sheet, a hearing and an inquiry report can be challenged.

Gratuity: what it is and how to calculate it

Section 2(10) defines gratuity as at least 30 days’ wages for each completed year of service, or 45 days’ wages per year once service passes 10 years. It is payable where the Act or the employer’s gratuity scheme provides for it, and it replaces compensation when it is higher.

Example: a worker with a basic wage of Tk 30,000 leaves after 8 years. Gratuity at 30 days a year is Tk 30,000 × 8 = Tk 2,40,000. Check your appointment letter and company policy; many schemes are more generous and some calculate on gross pay.

Final settlement and unpaid wages

• Monthly wages must be paid within seven working days after the wage period ends.
• When a job ends for any reason, all dues, including compensation, gratuity and leave pay, must be paid within 30 working days.
• Keep your appointment letter, payslips, bank statements, the termination or resignation letter and any emails about dues.

Writing an application for unpaid wages: address it to the employer, state your name, ID, designation and joining date, the months or amounts unpaid, the legal deadline, a clear demand and a reasonable date for payment. Send it by registered post or email and keep proof. This letter often becomes your first evidence.

Grievance and the Labour Court

1. Written grievance (s.33): within 30 days of the cause, to the employer by registered post.
2. Employer’s decision: the employer must inquire, give you a hearing and decide within 30 days.
3. Labour Court: if you are not satisfied, complain to the Labour Court within the following 30 days. Wage claims can also be filed under section 132, where the court can add compensation for wrongful deduction or delay.
4. Inspection: the Department of Inspection for Factories and Establishments (DIFE) also takes complaints about unpaid wages and unlawful terminations.

Labour Courts sit in Dhaka, Chattogram, Khulna, Rajshahi and other divisions. Keep within the time limits; late complaints are often dismissed.

What changed in 2025

• The definition of “worker” was widened, bringing in roles such as trade promotion and business development that employers often classed as management.
• Resignation benefits were extended to shorter service, with three tiers (7, 15 and 30 days’ wages per year).
• Every employer must form a five-member committee for complaints of discrimination, violence and harassment, headed by a woman, with a majority of women and two outside members.

Check how the amendment applies to your role and date of leaving; some changes apply only to events after it came into force.

Who the Labour Act does not cover

The Act protects “workers”. People employed mainly in managerial or administrative roles, government and statutory employees, and some others are outside it. Their rights come from the contract, service rules and the general law, and disputes usually go to the civil court. Your job title does not decide this; what you actually do does.