EPZ Labour Act vs Bangladesh Labour Act: HR Compliance Guide

Two factories. Same city. Same product. Different labour law.

In Bangladesh, the gate you walk through decides the rules you follow. Inside a zone run by the Bangladesh Export Processing Zones Authority (BEPZA), the Bangladesh EPZ Labour Act 2019 applies. Outside it, the Bangladesh Labour Act 2006 generally applies, and that Act was amended in 2026.

For HR teams running sites on both sides of the line, the differences need careful handling. This guide sets out where the two laws differ and what to get right.

Which law applies where

The EPZ Labour Act 2019 applies to the workers and employers of all industries in the EPZs and zones under BEPZA. It also has overriding effect: its provisions prevail over any other law in force. (EPZ Labour Act 2019, sections 1 and 3)

Economic zones are different. Section 34 of the BEZA Act was amended in November 2023 to extend the Bangladesh Labour Act 2006 to special economic zones, including trade union formation, collective bargaining and inspections by the Department of Inspection for Factories and Establishments (DIFE). (Ministry of Labour and Employment, NAP status report, October 2025)

As a general site-classification starting point, BEPZA zones are governed by the EPZ Labour Act; the applicable regime for BEZA zones and other sites should be confirmed against the site licence, current legislation and any sector-specific exclusion.

The 2026 amendment outside the zones

The Bangladesh Labour (Amendment) Act 2026 was published as Act No. 43 of 2026 in the Extraordinary Gazette on 10 April 2026. (Bangladesh Government Press) It followed an ordinance promulgated on 17 November 2025. (Labour Review)

Secondary commentary reports changes to maternity leave, trade union registration thresholds and unfair labour practices. These have not yet been mapped to the gazetted section numbers, so this article does not state them as law. A detailed comparison is pending legal verification.

No parallel amendment to the EPZ Labour Act 2019 was identified in the sources reviewed on 28 October 2026. (Mondaq)

The EPZ Labour Act: what HR must apply inside the zones

The EPZ Act is a complete code. These are the provisions HR and payroll touch most often. All references are to the EPZ Labour Act 2019.

Area	EPZ Labour Act 2019 rule	Section
Service rules	Company service rules need approval from BEPZA’s Additional Inspector General and cannot be less favourable than the Act	4
Probation	6 months for clerical workers, 3 months for others; extendable by 3 months	5
Wage payment	Within 7 working days after the wage period ends	26
Final dues	Within 15 working days of separation	56
Working hours	8 a day and 48 a week; up to 60 a week, averaging 56 a week over a year	38, 40
Overtime	Twice the ordinary rate of basic wage and dearness allowance	45
Leave	Casual 10 days, sick 14 days, festival 11 days; earned leave of 1 day per 18 days worked, encashable each year	50 to 53
Festival bonus	Festival bonus for permanent workers; the section refers to two months’ basic wages in a calendar year. Exact operation pending counsel review	53(4)
Maternity	8 weeks before and 8 weeks after delivery; requires 6 months’ service	30
Group insurance	Mandatory where 25 or more permanent workers are employed	36
Employer termination	120 days’ notice for permanent workers, plus 30 days’ wages per completed year of service	22
Resignation	30 days’ notice for permanent workers; compensation of 15 days’ wages per year after 5 years, 30 days’ after 10 years	23
Retirement	At 60, with 45 days’ wages per completed year	24

Two rules have no direct equivalent in most payroll set-ups outside the zones. The festival bonus provision, section 53(4), is under legal-language review; do not treat it as a fixed two-month payment until confirmed. And terminating 10 or more workers at once requires consultation with the zone’s Additional Inspector General. (Section 22(4))

Worker representation: associations, not unions

This is the sharpest difference between the two laws.

Inside BEPZA zones, workers may form a Workers’ Welfare Association (WWA). At least 20% of the permanent workers must apply, and a WWA cannot be registered unless 20% of permanent workers become members. Only one WWA is allowed per industry, and it may not affiliate outside the zone except through a zone-level federation. (Sections 94, 97, 100 and 102) Its elected representatives act as the Collective Bargaining Agent. (Section 119)

Outside the zones, workers may form trade unions under the Bangladesh Labour Act; the 2026 registration thresholds are pending legal mapping.

The EPZ position is under review. BEPZA and the International Labour Organization signed a letter of intent on 19 May 2025 for a two-year action plan, including an ILO-assisted draft to amend the EPZ Labour Act. (Ministry of Labour and Employment) HR teams should plan for change, not assume it.

Inspection is no longer BEPZA’s alone

Under the Bangladesh EPZ Labour Rules 2022, DIFE inspectors can carry out announced and unannounced inspections in EPZs with only intimation to BEPZA, not prior approval. (Ministry of Labour and Employment) Inspection findings to date have focused on service book management, first aid and safety committee registers. Records matter.

A compliance checklist for multi-site employers

1. Map every site to its legal regime: BEPZA zone, BEZA zone or outside.

2. Run separate leave, maternity and separation rules for EPZ and non-EPZ sites; do not let one policy template cover both.

3. Confirm service rules for EPZ units have current BEPZA approval.

4. Confirm festival bonus obligations for EPZ permanent workers with counsel, then budget them.

5. Keep service books, worker registers and safety committee records inspection-ready for both BEPZA and DIFE.

6. Track the EPZ Labour Act amendment process and be ready to re-configure.

One workforce, two rulebooks

Illustration for EPZ Labour Act and the Bangladesh Labour Act: HR compliance for export zone employers

The hard part is not knowing the law. It is applying two laws at once, to the same job titles, on the same payroll calendar. That calls for an HR and payroll platform that can hold different statutory rules per legal entity and site. Configuration by site, not by policy template, is the test to apply to any system.

FAQs

Does the Bangladesh Labour Act apply inside EPZs? No. The Bangladesh EPZ Labour Act 2019 applies to industries in zones under BEPZA and prevails over other laws.

Does the Bangladesh Labour Act apply in economic zones? Generally, yes. The Ministry of Labour reports that a November 2023 amendment to the BEZA Act extended the Bangladesh Labour Act 2006 to special economic zones. Confirm each site against its licence and current legislation.

Can EPZ workers form trade unions? Not under the current law. They may form a Workers’ Welfare Association, which acts as the Collective Bargaining Agent.

How much maternity leave applies in an EPZ? Sixteen weeks: 8 weeks before and 8 weeks after delivery, for workers with at least 6 months’ service. Comparison with the amended Labour Act is pending legal verification.

Is a festival bonus mandatory in EPZs? Section 53(4) of the EPZ Labour Act provides for a festival bonus for permanent workers, referring to two months’ basic wages in a calendar year. Exact eligibility, timing and number of payments are pending legal review.

Can DIFE inspect EPZ factories? Yes. Under the EPZ Labour Rules 2022, DIFE inspectors may inspect with intimation to BEPZA.

Is the EPZ Labour Act being amended? A review is under way with ILO technical support. No later amendment was identified in the sources reviewed on 28 October 2026; confirm with BEPZA or local counsel immediately before publication.