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Salary Deduction as per labour law

Salary Deduction and Obligation to Pay the Wages of Employees

When a worker or employee work in any organization for any period or for any completing any specific job or any part of job as per the written agreement or verbal agreement, then the employer has obligation to pay wages for that period or for that part of job.

Salary Deduction from the Wages by Employer

Deduction from wages of a worker for being absent from the place of work [Which is called unauthorized absent from the duty] may be made only, when he, by the terms of his employment, is required to work, but he is absent thereof.

The Amount of Salary Deduction for Absenteeism

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The amount of such deduction shall not be more than the amount of remuneration payable to him for the period of absent. That is literally for what time an employee is absent in his work place from his duty, the employer can deduct only for this specific time.

Here also mentionable that if 10 (Ten) or more employees collectively absent themselves from work without any notice and reasonable causes, the employer may deduct wages additionally of up to 8 (Eight) days. (Bangladesh Labour Act, 2006, Section-126)

Calculation of Deduction Form Wages

To calculate the deduction amount, due to absenteeism, the employer will divide the monthly wages with dearness allowance and ad-hoc allowances by 30 (Thirty). And it has to be informed to the related worker/employee.

Example: Monthly wages is 10,000 BDT, Dearness Allowance 5,000 BDT, Ad-hoc Allowance 3,000 BDT.

Then 1-day wage amount will be =18,000/30=600 BDT

Wages cannot be deducted due to absent except for the cases that are regulated by law or code of the institute. (Bangladesh Labour Rules, 2015, Rule 115)

Utilization of Deducted Amount (Fines)

All fines and all realizations thereof shall be recorded by the employer in the register prescribed by the rules and all fines realized shall be spent only for the welfare of the employees employed in the establishment. (Bangladesh Labour Act, 2006, Section-25)

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Minimum Wage

The Labour Act of 2006 establishes a mechanism for determining minimum wage rates for different industries, but it does not define the term minimum wage.

In accordance with recommendations made by the Wages Board, a specialized tripartite board established pursuant to article 138 of the Labour Act of 2006, minimum wage rates are announced by the government on an industry-by-industry basis.

The Wages Board takes into account the cost of living, standard of life, cost of production, productivity, price of goods, business capacity, inflation rate, economic and social conditions of the nation and the location in question, among other pertinent aspects, while making its proposal. If any of the aforementioned criteria change (within one to three years), the Minimuqm Wages Board (MWB) is required to update its recommendations.

Every five years, the government may require that the minimum pay rates for any industry be revised. Industry-specific minimum pay rates are established and are binding on all employers. Failure to pay employees the required minimum wage is penalized by up to a year in jail, a fine of up to 5,000 Bangladeshi taka, or both.

Inspectors of labor are permitted to monitor compliance with labor laws, notably those relating to minimum wage. Within a year of the date the sum became owed to the employee, a worker who is paid less than the minimum wage may file an application with the Labour Court to recover the difference.

Additionally, an employer that pays their employees’ salary at a lower rate can be penalised with up to a year in prison, a fine up to 5,000 taka, or both.

Source: The Labour Act of 2006, as revised in 2013, sections 138 to 142, 148 to 149, 289(1), and 329.

The Minimum Wage section contains the most recent minimum wage rates.


The phrase “wages” refers to all financial advantages, such as salary, bonuses, pay for overtime work, paid holidays or time off, termination money, and any other additional pay due under the terms of employment. The payment of salaries to employees is the responsibility of every employer.

If a contractor does not pay the salary of a person they have hired, the establishment’s employer is responsible for doing so. One month is the longest possible salary period. Every employee’s wages must be paid by the end of the seventh working day following the end of the wage period for which they are due.

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The earnings owed to a worker who has had his employment ended by retirement or by the employer—whether through retrenchment, discharge, removal, dismissal, or another method—must be paid before the end of the 30th working day from the date that his employment was terminated.

Wages must be paid in legal money, via check, or, in some circumstances (depending on the needs of the workers), by electronic transfer to the employee’s bank account or through any other digital means. A working day must be used to pay wages. Only the deductions permitted by Section 125 of the Labour Act may be taken from a worker’s pay.

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