Gratuity and Compensation Calculator (Bangladesh, 2026)
Under the Bangladesh Labour Act 2006, a permanent worker whose job is ended by the employer gets 30 days' wages for each completed year (or gratuity, if higher). Since 10 April 2026 a worker who resigns gets 7 days' wages per completed year for up to 3 years, 15 days for 4 to 9 years and 30 days from 10 years (or gratuity, if higher).
· Calculated with AiStaffo
The rules in Bangladesh
| Law | Bangladesh Labour Act, 2006 (Act No. 42 of 2006), sections 2(10), 19, 20, 22, 23, 26, 27 and 28, as amended by the Bangladesh Labour (Amendment) Act, 2026 (Act No. 43 of 2026, in force 10 April 2026) |
|---|---|
| Wage used | Last monthly wage as defined in section 2(45): money pay for the work, excluding housing, medical and similar facilities, employer provident-fund contributions and travel allowance. One day = monthly wage ÷ 30 |
| Termination by employer (s.26) and retirement (s.28) | 30 days' wages for each completed year, or gratuity if payable, whichever is higher |
| Retrenchment (s.20) and discharge (s.22) | 30 days' wages per year of service, or gratuity if payable, whichever is higher; at least 1 year of continuous service |
| Resignation (s.27(4), from 10 April 2026) | Up to 3 years: 7 days' wages per completed year. More than 3 and under 10 years: 15 days. 10 years or more: 30 days, or gratuity if payable, whichever is higher |
| Dismissal for misconduct (s.23(3)) | 15 days' wages per completed year with at least 1 year of service; nothing for dismissal under section 23(4)(b) or (g) |
| Death in service (s.19) | At least 1 year of service (2 years before April 2026): 30 days' wages per completed year or part over 6 months, 45 days if death occurred at work or from a work accident, or gratuity if higher |
| Gratuity (s.2(10)) | Where payable: at least 30 days' last wages per completed year or part over 6 months; 45 days' wages per year for service of more than 10 years |
Worked example
Last monthly wage BDT 30,000, so one day = 30,000 ÷ 30 = BDT 1,000.
The employer ends the job after 12 years and 4 months: 12 completed years × 30 days × 1,000 = BDT 360,000. If the same worker resigned after 7 years and 8 months instead: 7 completed years × 15 days × 1,000 = BDT 105,000.
What changed in 2026
The Bangladesh Labour (Amendment) Ordinance, 2025 (17 November 2025) was replaced by the Bangladesh Labour (Amendment) Act, 2026, in force from 10 April 2026. For resignation it replaced the old rule (nothing under 5 years, 14 days per year from 5 to 10 years, 30 days from 10 years) with 7 days per completed year up to 3 years, 15 days from more than 3 to under 10 years, and 30 days from 10 years. Death compensation now needs 1 year of service instead of 2, and section 23(3) now names dismissed workers as well as workers removed from service for the 15-day compensation (still not for cases under section 23(4)(b) or (g)).
Compensation or gratuity: which is paid?
The Act defines gratuity (30 days' wages per year, 45 days after 10 years) but most sections pay "compensation or gratuity, if payable, whichever is higher". If your employer has a gratuity scheme in its service rules, work out both: choose your reason, then choose "Gratuity under the employer's scheme", and the higher figure is due. Compensation is paid in addition to other benefits under the Act, such as provident fund and unused leave.
For employers: gratuity is one line of what a role costs
Gratuity, leave, statutory contributions and notice periods all sit on top of salary. Routine back-office roles such as data entry, follow-ups, reconciliations and reporting can be handed to AI workers that carry none of these costs. Book a free automation audit and we will put your own figures on it.
Please note: this calculator follows the published law and common practice as checked on 21 October 2026. It is a guide, not legal advice. Contracts can give more than the legal minimum, and special cases (part-time work, free zones, disputes) can change the figure, so confirm the final amount with your HR team or a lawyer before paying or accepting a settlement.
Sources
Questions people ask
How is gratuity calculated in Bangladesh?
What do I get if I resign in Bangladesh in 2026?
What is the compensation if the employer terminates me?
Do I get anything if I am dismissed for misconduct?
Does a worker who retires get gratuity?
Is the 2025 ordinance still in force?
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