Offboarding and Severance Pay in Bangladesh
Severance pay in Bangladesh is 30 days’ wages for each completed year of service, or gratuity if higher, when a permanent worker is terminated without misconduct. Eicra Soft Limited administers the whole exit for international employers: the right notice for the route, the settlement on the right wage base, and the records the Labour Act requires.
The work starts from the leaver’s file: the appointment letter, worker or managerial status, the exit route, service length and the wage split. Every figure is computed in writing against the section that governs it, and your named owner approves the settlement before anything is paid.
Send us the leaver’s file. Tell us the role and the letter, the reason, the service length, the wage split and the last working day you want. We book a short scoping call, then send a written quote, and the exit review starts only once you approve that quote.
You get a written verdict — a notice-and-settlement plan for this exit, a records fix because the file cannot support a calculation, offboarding inside our employer of record because we are the employer, or a lawyer because a case is already in play. When we are the employer under our remote staffing service in Bangladesh, the exit runs inside that contract. If the exit is already right, you stop here and keep the review.
Scope 01 · A written quote
Review 02 · The route and its section
Exit 03 · The settled statement
Production 04 · Every later leaver
Managed Ops 05 · A standing checklist
What does severance administration include?
Offboarding and severance administration in Bangladesh covers the six things a lawful exit involves beyond a last salary. They are the right notice for the route, severance or gratuity on the right wage base, final dues computed and approved, the service certificate the Act requires, equipment and access closed, and a settlement statement both sides keep.
The right notice for the route
Termination, resignation, retrenchment, dismissal for misconduct and expiry each carry their own section and notice period under the Labour Act. We identify the route from the facts and the appointment letter, draft the notice, and record the date it was served and by whom.
Severance on the right wage base
Severance pay in Bangladesh is not equal to salary, and gross salary is the wrong base for it. The law counts thirty days’ wages per completed year, or gratuity where higher, on basic wage plus dearness allowance and any ad hoc or interim wage. We show each line for approval.
Final dues, computed and approved
Unpaid wages, leave encashment, severance or gratuity, any contractual benefit and lawful deductions go in one settlement statement, sent to your named owner for approval. Payment follows only after that approval, inside the thirty-working-day window the Act sets for every exit route.
Service certificate and records
Every worker except casual and substitute workers is entitled to a certificate of service on leaving. We issue it in the employer’s name on the last day and close the employee file, dated, so the exit can be evidenced later without anyone reconstructing it.
Equipment and access closed on the date
Each item issued to the employee is listed and its collection in Bangladesh arranged before the last working day. System access is removed on the date you set, and the handover is recorded with the settlement, so the equipment list and the exit close together.
Settlement statement both sides keep
One statement shows every amount paid, the section it rests on, the approval and the payment date. The employee receives it and your HR system keeps it, so you and any later tribunal hold the same record of the exit.
Not included: Deciding to end anyone’s employment · advising on law or representing you before a labour court · collecting items we never issued · the statutory amounts owed, which are separate · new routes, new entities or changes in the law, agreed first as a change request.
Which exit route applies under the Labour Act?
The rules for terminating an employee in Bangladesh depend on which of four exit routes applies: the route decides the notice, the money and the paperwork. The resignation tiers come from the Labour (Amendment) Act 2026, and the exit review names the route in writing before anything is computed.
Under our employer of record service, the duty is ours and the evidence yours.
| Route | Notice | Money on exit | Key section |
|---|---|---|---|
| Termination | 120 days (monthly-rated permanent) or 60, in writing, or wages in lieu | 30 days’ wages per completed year | Section 26 |
| Resignation | 60 days in writing from a permanent worker | 7, 15 or 30 days’ wages per completed year, by service tier | Section 27 |
| Retrenchment | One month in writing, reason stated, copy to the Chief Inspector | 30 days’ wages per completed year; last hired goes first | Section 20 |
| Misconduct | No notice, after written charges, at least seven days to reply and a hearing | 15 days’ wages per completed year past one year, except the gravest misconduct | Sections 23 and 24 |
Where gratuity is higher, gratuity is paid instead. Final dues for every route are payable within 30 working days.
What does one offboarding contain?
One offboarding contains five logged steps, because “we handle offboarding” tells you nothing. Each item in the log traces to a section, a figure, an approver and a date. The example is the termination of a monthly-rated permanent worker with four years and two months of service, employed by a client’s own entity. Yellow marks where a person signs.
Two sections of the Bangladesh Labour Act stand behind the log. Section 26 states the compensation: “30 (thirty) days wages for his every completed year of service or gratuity, if payable, whichever is higher”. Section 30 states the deadline for all amounts due: “within a maximum period of 30 (thirty) working days following the date of cessation of his employment”.
- 1Review signedRoute: termination under s.26Worker status confirmed from the letterWage split: basic + dearness allowanceOwner named
- 2Notice served120 days’ written notice, or wages in lieu, dated and acknowledgedLast working day fixedAccess removal date set
- 3Settlement computed4 completed years × 30 days’ wages, or gratuity if higherLeave encashmentDeductionsStatement versioned
- 4Owner sign-offa person signsYour owner approves the settlement statementApproval logged with date and versionPayment scheduled
- 5Settled and closedFinal dues paid inside 30 working daysService certificate issuedEquipment loggedFile closed and dated
Every step logged, each traceable to a section, a figure, an approver and a date.
Illustrative run. Yellow marks where a person signs; four years and 120 days are an example, not a result.
How does offboarding run with us?
Offboarding runs in five steps: a scoping call, the exit review, the exit itself with your approval on every figure, production for later leavers, then Managed Ops. Each step ends with a document you keep. Exits go wrong when the calculation is done the day before the last day and the notice was never served in writing.
01 A written quote
Scope A call about the leaver: role and letter, reason, service length, wage split, the last working day you want, and anything already said or sent. If the facts are clear, you receive a written quote for the exit review.
02 The route in writing
Review Appointment letter and file read; worker or managerial status settled; the route and its section named; notice, severance or gratuity, leave encashment and deductions computed in writing on the right wage base.
03 The settled exit
Exit Notice drafted and served on the date you set; settlement statement approved by your owner; equipment collected and access removed; final dues paid inside thirty working days; service certificate issued; the file closed and dated.
04 Every later leaver
Production Every later exit run the same way from the same checklist: route named, figures approved, window met, and the file closed the same way for each leaver, so a second exit looks like the first.
05 A standing checklist
Managed Ops For teams: a standing exit checklist, probation review dates watched, wage split kept clean in every letter so the base is never in doubt, and the rules re-read when the Act or its rules change.
Who runs your offboarding, and with what?
You meet the team on day one. An HR administrator owns the route, the notice and the certificate, a payroll accountant computes the settlement on the right wage base, and a reviewer checks every figure before anything reaches your owner for approval.
Named team An HR administrator, a payroll accountant and a reviewer
References The Labour Act and Rules as amended; the appointment letter
Communication One exit lead per leaver, shared channel
Delivery Your HR and payroll systems; nothing stored on our side
Quality assurance Second-person review of every settlement; versioned; approver named
Ownership Every notice, statement and certificate in the employer’s name
Exit plan, records fix, EOR or lawyer?
Buyers planning an exit arrive in one of four situations. A leaver and nobody sure what is owed: an exit plan. No letter or wage split on file: a records fix first, backed by the compliance pack. Employed through our employer of record: offboarding inside that service. A court case live: a lawyer, with our file. Five questions decide.
1. Who is the legal employer of the leaver?
2. What is the exit route?
3. Does the file hold a signed appointment letter?
4. Has the employee raised a complaint or a case?
5. When is the intended last working day?
Five questions decide the verdict
Tap an answer in each row on the left; the verdict updates as you choose, and the button takes you to the next step for that case. The default shown is the most common one: a leaver, a clean file and no live case.
An exit plan for this leaver
A leaver and nobody sure what is owed is the case this page exists for: the exit review names the route and its section, computes notice, severance or gratuity and final dues on the right wage base, and the exit runs with your approval on every figure and final dues paid inside thirty working days.
A first reading; the exit review confirms it.
How the verdict is decided
A court case or criminal allegation → a lawyer, with our file
Employed through our employer of record → offboarding inside that service
No letter or no wage split → records fix first
Otherwise → an exit plan for this leaver
Why choose Eicra Soft Limited for exits?
An offboarding provider is judged on whether the notice period and the wage base were right. The Bangladesh Labour Act 2006 keeps the 120-day notice after its amendment, and the Labour (Amendment) Act 2026 sets the wage base and the resignation tiers. We work from those texts, section by section, with every figure shown to your owner for approval.
Without a settled exit process
These four failures appear again and again in exits run on home-country habits, and each one is visible to a tribunal later. Every item below is a real pattern the written Labour Act text itself rules out, not a hypothetical.
!!!!!
- Thirty days’ notice given to a permanent worker the Act entitles to 120
- Severance computed on gross salary when the Act now says basic plus dearness allowance
- Final dues paid in the second month, outside the thirty-working-day window
- No certificate, no statement, and a grievance nobody answered in thirty days
With Eicra Soft Limited
The same exit, run from the Act section by section: the report below is an illustrative example of what your owner sees before approving, with every figure traceable to a section, a named approver and a date in the file.
Exit report · termination · four years’ service
RouteTermination, s.26Notice120 daysCompleted years4Approvals recorded2VerdictSettled inside the windowAgreed gate✓ Passed
Illustrative example
- The route and its section named in writing before anything is said to the employee
- Severance and gratuity computed on the amended wage base, shown line by line
- Final dues approved by your owner and paid inside thirty working days
- Certificate, statement and a dated file — the evidence a lawyer asks for first
Is outsourcing your offboarding safe?
Outsourcing offboarding is safe when you decide the exit, your owner approves every figure, and the line to a lawyer is clear. The risk is not where the administrator sits but who decides, approves the money and speaks to the employee. Eicra Soft Limited stays inside your systems under a mutual NDA and pays nothing unapproved.
Which agreements are signed, and when?
Five agreements and limits are fixed in writing before any leaver’s data moves, so the confidentiality, privacy and access questions are answered before the first name is shared, not negotiated in the middle of a live exit with a leaver waiting.
NDA — mutual, signed before any appointment letter, salary figure, reason for exit or settlement is shared with anyone.
Privacy — a data processing agreement (DPA) with processor terms under Article 28(3) of the General Data Protection Regulation (GDPR), where that regulation applies, and under Bangladesh’s Personal Data Protection Act.
Data transfers — standard contractual clauses, or another transfer instrument if your jurisdiction requires one, signed before the leaver’s data moves.
Access — only the HR and payroll modules the exit needs, with no bank credentials, no payment authority and no production systems of yours.
Certifications — named only once held, and none is claimed; we are neither a law firm nor a licensed representative before a labour court.
What controls and ownership terms apply?
Five standing terms govern every engagement, and none of them changes per exit: where the records live, who owns them, where our role stops, who approves the money and how a failed checklist item is put right when it happens.
Your accounts Every notice, calculation, settlement statement, certificate and closed file lives in your HR and payroll systems from the first day; nothing is stored on our side.
Document ownership Under the contract every record belongs to the employer: export it, hand it to a lawyer or a tribunal, or move it to another provider whenever you choose.
Boundary We administer the exit; we do not decide to end anyone’s employment, advise on law, represent you before a labour court, or promise that an exit stays out of one — you and your counsel decide, and we give you the file that helps.
Approval No notice is served, no amount paid and no certificate issued until your named owner has approved that exit’s statement; approvals, dates and versions are recorded.
Rework If a settlement item fails its agreed checklist, we correct it. A new route, a new entity or a change in the law is agreed first, as a change request.
Ask for our NDA, DPA and IP assignment templates on the scoping call.
What proof do you get before you pay?
Before anything is charged, check three things we commit to. They are final dues and the service certificate inside thirty working days of the last working day, a team named on day one, and a written result at every step, where you can stop. After the exit review you get a fourth: this leaver’s route, section and settlement, in writing.
30 days
Inside 30 working days: from the last working day to final dues paid and the service certificate issued, with the calculation approved by your named owner first and every date recorded in the file.
Day one
Named on day one: an HR administrator and a payroll accountant you meet on the first call, with one exit lead per leaver and a reviewer who checks every settlement figure before you see it.
Any step
Stop at any step: a written result at every step, and the exit does not move forward until your named owner has approved the settlement statement for that leaver in writing.
Case studies: client results with numbers are added here as clients give permission to name them. Ask on the scoping call for references in your industry.
What do employers ask about severance pay?
Employers ask ten questions about offboarding and severance pay in Bangladesh before they book a call. They ask what notice the law requires, how severance is calculated and on which wage, what resignation and retrenchment pay, how misconduct is handled, when final dues are due, and where our service stops. Each answer opens with the answer sentence.
Reviewed by Mohammad Nazrul Islam, Managing Director, Eicra Soft Limited.
What notice ends employment in Bangladesh?
For a permanent worker paid monthly, the employer must give 120 days’ written notice, or 60 days for other permanent workers, under section 26 of the Bangladesh Labour Act. Wages for the notice period may be paid instead. The 30-day and 14-day figures many pages quote apply to temporary workers only.
How is severance pay calculated?
On termination without misconduct, severance is 30 days’ wages for each completed year, or gratuity if higher, on the last monthly basic wage plus dearness allowance and any ad hoc or interim wage. Severance pay in Bangladesh is not 100% of salary: gross salary is not the base. Section 26 sets the rate, the Labour (Amendment) Act the wage.
What does a resigning worker receive?
A permanent worker resigns with 60 days’ written notice under section 27 of the Bangladesh Labour Act, or wages in lieu of it. The benefit is 7, 15 or 30 days’ wages for each completed year by service tier under the Labour (Amendment) Act 2026, or gratuity if higher, computed on the same wage base as severance.
What happens in a retrenchment?
Retrenchment under section 20 needs one month’s written notice stating the reason, with a copy to the Chief Inspector, or wages in lieu. The worker receives 30 days’ wages for each completed year, or gratuity if higher, and the last person hired in the category is normally the first retrenched.
Can misconduct end a job without notice?
Yes, under sections 23 and 24, but only after a written procedure, and a worker with more than a year of service still receives 15 days’ wages per completed year, except for the gravest misconduct. The procedure has three fixed parts, and skipping one makes the dismissal challengeable.
- Written charges are served on the worker.
- The worker gets at least seven days to reply.
- A hearing is held before any dismissal order.
Do managers get worker severance?
Not necessarily. The Labour (Amendment) Act keeps people appointed in writing to managerial, chief executive, administrative or supervisory roles outside the Act’s definition of worker. Their notice and severance follow the employment contract rather than sections 26 and 27. We read each appointment letter and compute nothing until the status is settled in writing.
When must final dues be paid?
All final dues must be paid within thirty working days of the employment ending, whatever the route, under sections 30 and 123 of the Bangladesh Labour Act. We schedule the calculation, your owner’s approval and the payment inside that window and record each date. We also issue the certificate of service section 31 requires on leaving.
What does exit administration include?
Exit administration includes six parts: the right notice for the route, severance or gratuity on the right wage base, final dues computed and approved, the service certificate, equipment and access closed on the date, and a settlement statement both sides keep. Deciding the exit, legal advice and court representation stay with you and your counsel.
What happens after we get in touch?
After you get in touch, the work follows a fixed order, and nothing starts or is charged until you approve a written quote. You can stop after any step and keep what it produced, including the review and any computed settlement.
- We hold a short scoping call about the leaver and the file.
- You receive a written quote for the exit review.
- The review names the route, its section and the settlement in writing.
- The exit runs with your owner’s approval on every figure.
What stays outside your service?
The service does not include deciding to end anyone’s employment, advising on law, representing you before a labour court, collecting items we never issued, or the statutory amounts themselves, which are always separate. If a court case or a criminal allegation is live, your lawyer leads and we hand over the complete file.
Ready to settle an exit the lawful way?