Hidden Gems
Nepal
Min. wage
(x13 payments)
NPR 19,550 /mo
About the minimum wage
Employer tax
Annual leave
18 days
Learn about annual leave
Notice period
1-30 days (by tenure)
Termination and notice info
Updated
Nov 2026
The default and most common employment type is the indefinite/regular contract, continuing until terminated under the Labour Act 2074. An employee continuing past 6 months of probation automatically becomes permanent.
The Labour Act 2074 recognizes time-bound (fixed-term), work-based, casual (7 days or less/month), and part-time (under 35 hrs/week) categories. No single statutory maximum for time-bound contracts, but repeated renewals for an ongoing role carry reclassification risk.
Standard hours are 8/day, 48/week, with at least one weekly rest day and a 30-minute break after 5 continuous hours. Overtime capped at 4 hrs/day, paid at 150% of regular hourly wage.
Maximum 6 months. If the employer does not formally terminate within that period, the employee automatically converts to permanent status.
Under Labour Act 2074, Section 37, every employer must pay a Festival Allowance equal to one month's basic salary once per year, pro-rated for under 1 year of service. Functions as Nepal's de facto 13th-month payment.
Foreign nationals require a role-specific work/labour permit matching duties performed. Employers generally must show no suitable Nepali candidate is available. Informal guidance limits foreign staff to around 5% of workforce, max 3 foreign nationals including CEO absent a specific government agreement.
Employer pays 20% of basic salary into the SSF: 10% provident fund, 8.33% gratuity, 1.67% across accident/disability, medical/health/maternity, and dependent family protection funds. A monthly basic-salary contribution ceiling of NPR 350,000 applied for FY 2082/83 (2025/26).
Employee pays 11% of basic salary into the SSF: 10% provident fund + 1% social security tax. Combined with employer's 20%, total SSF contributions equal 31% of basic salary.
In addition to statutory leave, employees are entitled to the following statutory benefits:
Nepal's Social Security Fund (SSF) requires a combined statutory contribution of 31% of basic salary.
Calculated on basic salary only (Labour Rules require basic salary ≥60% of gross pay). Monthly basic-salary ceiling: NPR 350,000 (FY 2082/83).
Employers must bear full medical treatment costs and pay compensation per a statutory schedule for work-related injury/occupational disease, based on severity and salary.
Two separate separation payments:
Nepal mandates an annual Festival Allowance ("Dashain Bonus") under Labour Act 2074, Section 37.
P.S. our team speaks multiple languages and we'd love to chat in your preferred language if requested.
Your employee's hours, time off, holidays, bonuses, and commissions are automatically calculated into payroll. RemoFirst will invoice you in either US Dollars (USD), Euros (EUR), British Pounds (GBP), Canadian Dollars (CAD), Australian Dollars (AUD), or Singapore Dollars (SGD) around the 15th of each month to make sure your employees are paid on time. To make it even easier, you can summarize your entire global team's salaries to aggregate them into one payment (instead of many individual payments).
Unlike full-time employees, contractors work on projects with multiple companies at a given time and are technically self-employed. Full-time employees are solely focused on their employer and usually receive benefits (such as health insurance, equity or stock options, and time off) as an additional form of compensation. While it can be cheaper to work with international contractors instead of paying benefits to a full-time employee, you run the risk of misclassification. It's recommended to work with an EOR for contractor onboarding and payments, so you can know that your international contractors are paid compliantly and on time.
Whenever the employee or employer has a question about, or anything else related to international employment, they can speak with our customer support team to get answers from our team of experts.
