How to hire and pay employees in Laos

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Laos Facts and Stats

Currency

Laotian Kip is the official currency of Laos. Its currency symbol is LAK.

Languages

Lao is the official language of Laos.

Population

The population of Loas is 7.7 Million.

Payroll frequency

Employees are paid monthly.

Hiring

Grow your team in Laos

No entity, no problem

To start growing your team in Laos, you must establish a local entity- including an account with a local bank, a local office and an address registered as a subsidiary. This allows you to manage payroll, tax, benefits and compliance for your employees, but can take several months.

Emerald can hire and payroll your workers quickly and compliantly with their ‘ready to go’ entity. Make growing your team simple with Emerald as a global partner.

Emerald can hire and payroll your workers, quickly and compliantly with their ready to go entity. Make growing your team simple with Emerald as a global partner.

Pros & Cons of hiring in Laos

Hiring employees in Laos presents both opportunities and challenges. One advantage is access to a relatively low-cost labour market, which can significantly reduce staffing expenses compared to higher-wage countries. The country also offers a growing pool of young, motivated workers eager to gain experience and contribute to developing industries such as manufacturing and services. Additionally, Laos’ strategic location in Southeast Asia can facilitate regional business expansion. However, challenges include potential issues with less developed infrastructure, which may impact logistics and communication. There may also be regulatory complexities and a need for local expertise to navigate the legal and business environment. Moreover, while English proficiency is increasing, it may not be widespread, potentially creating communication barriers.

Why Laos is good for remote workers

Hiring remotely in Laos offers several specific advantages. The country provides access to a cost-effective labour market, which can lead to substantial savings on wages compared to more expensive regions. Laos has a growing number of skilled professionals in fields such as IT, engineering, and finance, thanks to increasing investments in education and training. Additionally, the relatively low cost of living in Laos means that remote workers can deliver high-quality work at competitive rates. The country’s strategic location in Southeast Asia also provides an opportunity for companies to tap into a time zone that is advantageous for coordination with other regional markets. As remote work infrastructure and internet connectivity improve, businesses can benefit from a talented workforce while reducing overhead costs associated with physical office space.

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Benefits

Mandatory Benefits

Social Security Contributions

Employment

Probation

Typically, up to 3 months.

Emerald Technology can onboard employees in Laos within 48 hours.

Leave Policy
01.

Maternity Leave:

 In Laos, female employees are entitled to 90 days of paid maternity leave. This includes 45 days before the expected delivery date and 45 days after childbirth. Maternity benefits are typically provided through the Social Security Fund, ensuring that employees receive their full salary during this period.

02.

Paternity Leave:

In Laos, fathers are entitled to 3 days of paid paternity leave.

03.

Sickness Leave:

In Laos, employees are entitled to up to 30 days of paid sick leave per year. Sick leave is compensated at 100% of the employee’s salary for the first 15 days, and at 50% for the remaining 15 days, provided the employee has medical certification.

Onboarding

Onboarding

As the legal employer, Emerald Technology requires the following employee documents to ensure complete compliance:

Emerald Technology can onboard employees in Laos within 48 hours.
Termination

Resignation and Dismissal

When an employer dismisses an employee it must be with just cause and they must give them notice. The notice period starts from the day after the employer notifies the employee of the termination. Notice must be given in accordance with the following schedule at a minimum:

Notice Periods:

1 month on salary, 15 days on probation.

Severance

If an employee is made redundant, they are entitled to a payment based on years of continuous service.

Severance Pay:

In Laos, severance pay is generally required for employees who are terminated due to redundancy or specific reasons outlined in their employment contract. The statutory severance pay typically amounts to one month’s salary for each year of service.

Time off

Statutory Time off

Employees are entitled to 15 days of paid annual leave.

Public Holidays

  • New Year’s Day,
  • International Women’s Day,
  • Lao New Year (Pi Mai Lao),
  • Labor Day,
  • Victory Day,
  • King’s Birthday,
  • Assumption of the Buddha,
  • National Day,
  • Christmas Day,
  • Buddha’s Birthday,
  • Bon Phat That Luang,
Emerald Technology can onboard employees in Laos within 48 hours.
Salary / Taxes

Work, Pay and Taxes

01.

Minimum Wage:

1,200,000 LAK per month.

02.

Working Time and Overtime:

Weekly hours: 48 hours per week – 6 days of 8 hours.
Overtime on normal working days: Overtime work is paid at 150% of the regular hourly rate for hours worked beyond the standard 48-hour workweek.

Overtime on rest days and public holidays: Overtime on rest days or public holidays is paid at 200% the regular hourly rate.

03.

Salary Payments:

Monthly.

04.

Bonuses in Laos:

There is no statutory law for bonuses in Laos.

05.

Income Tax:

  • Up to 3,000,000: 0%,
  • 3,000,001 to 5,000,000: 5%,
  • 5,000,001 to 10,000,000: 10%,
  • 10,000,001 to 20,000,000: 15%,
  • Above 20,000,000: 20%.
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