Guidance to Labour Act of Nepal

As Nepal’s regulatory environment continues to evolve, labour law compliance has become an essential responsibility for employers across all sectors. To help organisations understand their obligations under the Labour Act, 2074 (2017), we at A.P. & Associates, Chartered Accountants have compiled and developed a comprehensive guide to understand Nepal Labour Law Compliance.

The guide provides practical insights into the legal requirements governing employment relationships, workplace conditions, employee benefits, occupational safety and labour-management relations. It outlines the importance of written employment agreements, compliance when hiring foreign nationals, restrictions on child labour and the legal framework for trainees and apprentices.

Employers are also reminded of their obligations regarding working hours, overtime compensation, annual salary increments, festival allowances, statutory leave entitlements and social security contributions. The publication further highlights requirements related to occupational health and safety policies, internal governance mechanisms, labour relations committees and dispute resolution procedures.

A key message of the guide is that labour law compliance extends beyond avoiding penalties. Organisations that provide fair wages, safe working conditions and legally mandated benefits are better positioned to attract talent, improve productivity and strengthen their reputation among employees and stakeholders.

The publication also explains the potential legal and financial consequences of non-compliance, including fines, compensation liabilities and labour court proceedings, underscoring the importance of proactive compliance monitoring.

Read the full guide to gain a detailed understanding of Nepal’s labour law framework and the practical steps organisations can take to ensure compliance and foster ethical workplace practices.