Labour Law in Nepal 2082/83 (2026)

Yes. Labour Act 2074 requires a written contract for every employee except casual workers (work of up to seven days a month). Probation is capped at six months.

8 hours a day and 48 hours a week, with a 30-minute break after 5 continuous hours. Overtime is capped at 4 hours a day and 24 hours a week, paid at a premium.

Five categories: regular (open-ended, the default), work-based (tied to a defined project), time-based (fixed-term, renewable), casual (work of up to seven days a month) and part-time (up to 35 hours a week). Each has its own treatment for contract, benefits and termination, and the category should be stated in the employment contract from day one to avoid disputes about entitlements later.

Probation is capped at six months under the Labour Act 2074. After six months the worker is treated as confirmed unless terminated within the probation window, with the result that the worker becomes entitled to the full protections of the Act for a regular employee. Either side may end employment during probation on short notice, but the cap on the probation period itself is hard.

Overtime under the Labour Act 2074 is permitted only with the worker's consent and is capped at four hours a day and 24 hours a week. It is paid at the premium rate set by the Act for overtime work, which is higher than the regular hourly rate. Children below 18 cannot be required to do overtime, and managerial-level employees may have contract-based alternatives subject to the Act's minimums.

Maternity leave is 14 weeks in total under the Labour Act 2074, of which broadly 60 days are fully paid; the remainder follows the Act's specific provisions and any employer policy that is more favourable. A common misconception is that the full 14 weeks are paid — only the statutory paid portion is, with the rest treated under the Act's framework. Paternity leave is 15 days paid for the father.

The Act sets graduated notice periods by length of service — broadly one day for very short service, seven days for service of up to a year, and 30 days thereafter — and the worker is generally entitled to severance pay of one month's basic salary per completed year of service on lawful termination. Termination on misconduct grounds requires an inquiry with the worker given an opportunity to be heard, and wrongful termination is challengeable before the Labour Court.

Severance pay under the Labour Act 2074 is generally one month's basic salary for every completed year of service, payable on lawful termination. It is calculated on the basic component of the salary, not the gross or total compensation. Some terminations, such as those for serious misconduct after a proper inquiry, can affect severance entitlement. The severance computation is one of the most commonly disputed items when a termination reaches the Labour Court.

The Labour Court is the specialised forum set up under the Labour Act 2074 to hear individual and collective labour disputes — wrongful dismissal, wage and benefit claims, unfair labour practice, and union matters. It sits with a chairperson and two members and operates after first-tier mediation through the Labour Office and a mediator/Labour Relations Committee. An appeal from the Labour Court runs to the Supreme Court within the statutory window.

The Contribution-Based Social Security Act 2074 created the Social Security Fund (SSF), and Labour Act 2074 enrolment obligations mean every formal-sector employer registers with SSF and contributes for each employee. The combined contribution is 31% of basic salary — 11% from the employee and 20% from the employer — covering medical, accident and disability, dependent family, and old-age protection. SSF replaces standalone provident-fund and gratuity arrangements for enrolled employers.

Yes, with the additional requirement that a foreign worker also holds a work permit from the Department of Labour & Occupational Safety (DoLOS) and the appropriate non-tourist visa from the Department of Immigration. The work permit is granted where the role cannot be filled by a qualified Nepali, and the employer is expected to support skill transfer to local employees over time. The Labour Act 2074 framework otherwise applies to the foreign worker's employment.

The statutory minimum monthly wage was revised in 2025 and applies under the Labour Act 2074 framework, with the figure published by the Ministry of Labour, Employment & Social Security via the tripartite Minimum Wage Fixation Committee. The current minimum is broadly NPR 19,550 a month, with separate sectoral notifications (such as the tea estate sector at a different figure). Paying below the minimum exposes the employer to a per-worker penalty under the Act.

Yes, but only after a proper inquiry in which the worker is given written notice of the alleged misconduct, an opportunity to be heard, and the right to be assisted by a representative. The Act lists categories of misconduct, and the employer must follow the procedure to make the dismissal lawful. A dismissal that skips the procedure — even where the underlying conduct is real — is exposed to reversal at the Labour Court as a procedural breach.

The Labour Act 2074 entitles each worker to a festival expense equal to one month's basic remuneration each year, typically paid around Dashain by default; a worker may request that it be paid aligned with their own main festival instead. Pro-rata applies for workers with less than a full year of service. The festival expense is the basic-salary component, not the gross or total compensation — a common point of confusion in payroll.

Yes. The Labour Act 2074 entitles workers to annual home leave accumulating up to a statutory cap and paid sick leave (commonly 12 days a year). Specific accumulation and conversion rules sit in the Act and Rules — for example, accrued home leave can be carried forward up to the cap, and certain conversions to pay are allowed in defined situations. Confirm the precise calculation against the current Act and Rules.

First through the Labour Office and a mediator or Labour Relations Committee at the workplace, and then through the Labour Court for unresolved disputes. The Court has both original and appellate jurisdiction and is composed of a chairperson and two members. An appeal from the Labour Court runs to the Supreme Court within the statutory window. The aim of the framework is to channel most disputes through mediation and conciliation rather than straight to a court hearing.

An employer is expected to keep employment contracts, payroll and attendance records, leave records, SSF contribution records, an HR policy / handbook, occupational health and safety records, and the documents needed for the statutory labour audit. These records support routine inspections, the annual labour audit, and any dispute or assessment before the Labour Office or Court. Keeping them in order is part of the discipline that prevents disputes escalating in the first place.

No. The Labour Act 2074 (2017) replaced the older Labour Act 2048 (1992) and substantially modernised the framework — including reorganised worker categories, an updated termination and severance regime, integration with the Contribution-Based Social Security Act 2074 (SSF), and a fresh Labour Court structure. Old material referring to Labour Act 2048 is largely outdated, and anyone updating an employee handbook from pre-2017 should rebuild it on the 2074 framework rather than amend the older one.

For drafting employment contracts and HR policies, for handling a termination or disciplinary inquiry, for an annual labour audit, for an SSF enrolment or a sexual-harassment complaint, and for a dispute before the Labour Office or the Labour Court. A lawyer keeps the contract aligned with the Act, the closing steps clean, and the dispute strategy realistic, which is the cheapest and most reliable form of labour-law risk management for an employer.