1. What are the legal requirements for an employment contract in Nepal?

An employment contract in Nepal must follow the guidelines set by the Nepal Labor Act, 2074 (2017) and its amendment, which outlines the rights and responsibilities of both employers and employees. The legal requirements for an employment contract in Nepal are as follows:

1. Offer letter: The employer must provide a written offer letter to the employee, specifying the terms of employment, such as job position, salary, benefits, working hours, etc.

2. Duration: The duration of the contract must be specified and should not exceed two years.

3. Nature of work: The nature of work to be performed by the employee must be clearly stated in the contract.

4. Wages and benefits: The employer must adhere to the minimum wage set by the government for different sectors and provide other benefits such as bonuses, provident fund, gratuity, etc.

5. Working hours: The maximum working hours per week must not exceed 48 hours or eight hours per day.

6. Rest days: Employees are entitled to at least one rest day per week, which is usually observed on Saturdays.

7. Public holidays: An employee is entitled to paid leave during public holidays as specified by law.

8. Probation period: An employee can work under probation for a maximum of six months or as agreed upon between both parties.

9. Termination clauses: The reasons for termination and notice period must be clearly outlined in the contract.

10. Non-discrimination clause: Employers cannot discriminate against employees based on factors like race, gender, religion, caste or ethnicity.

11. Trade union rights: Employees have a legal right to form trade unions for their protection and promotion of their collective interests.

12.Codification of terms: All terms agreed upon between both parties must be clearly stated in writing in a language that both parties understand.

It is advisable for employers to seek legal advice while drafting an employment contract to ensure compliance with all the necessary legal requirements. Additionally, both parties must sign the contract to make it legally binding and enforceable.

2. Is it mandatory for an employment contract to be in writing in Nepal?

Yes, it is mandatory for an employment contract to be in writing in Nepal. The Labour Act of Nepal requires employers to provide a written contract to their employees within one month of the start of their employment. The contract must include important terms such as job duties, salary, working hours, and other benefits. Having a written employment contract can help protect the rights and interests of both the employer and employee.

3. Can an employer modify the terms of an employment contract without the employee’s consent in Nepal?

No, an employer cannot modify the terms of an employment contract without the employee’s consent in Nepal. According to the Labor Act 2017, both parties (employer and employee) must mutually agree to any changes in the terms of employment. Any changes made by the employer without the employee’s consent would be considered a breach of contract and could lead to legal consequences. It is important for employers to follow proper procedures and obtain written consent from employees before making any modifications to their employment contracts.

4. Are there any specific laws or regulations governing part-time contracts in Nepal?

Yes, there are specific laws and regulations governing part-time contracts in Nepal. The Labor Act, 2074 (2017) regulates the employment of workers in Nepal, including those on part-time contracts. Some key provisions related to part-time contracts in the Labor Act are:

1. Definition: The Labor Act defines a part-time worker as an individual who works fewer hours than a full-time worker and receives proportionate wages.

2. Work Hours: According to the Labor Act, part-time workers cannot be required to work for more than six hours per day or 36 hours per week.

3. Wages: Part-time workers must receive wages proportionate to the number of hours they work compared to that of a full-time worker doing similar work in the same organization.

4. Working Conditions: The working conditions for part-time employees must be consistent with those prescribed for full-time employees, such as leaves, holidays, and other benefits.

5. Employment Contract: Employers must provide written employment contracts to all their employees, including part-time workers. The contract should clearly mention that the employee is on a part-time arrangement and state their working hours and wages.

6. Termination of Contract: Part-time workers have the right to terminate their contract by giving seven days’ notice while employers have the right to terminate the contract by giving 30 days’ notice or paying salary in lieu of notice.

7. Social Security and Other Benefits: Part-time workers are entitled to social security benefits such as provident fund, gratuity, sick leave, and maternity benefits according to their proportionate working hours.

8. Discrimination Prohibited: Discrimination against part-time workers based on their gender, race, religion, caste, political affiliation or any other grounds is prohibited under the Labor Act.

9. Child Labor Laws Apply: The laws prohibiting child labor also apply to part-timers. No person under 14 years of age can engage in part-time work.

10. Enforcement: The Department of Labor and occupational safety in Nepal is responsible for enforcing the provisions related to part-time work in the Labor Act.

In addition to the Labor Act, other laws such as the Labor Rules, 2074 (2017) and the Employee Provident Fund Regulations, 2072 (2015) also have provisions related to part-time contracts. Employers are advised to consult these laws and regulations for further details and compliance requirements.

5. What are the maximum working hours allowed under a standard employment contract in Nepal?

The maximum working hours allowed under a standard employment contract in Nepal is 48 hours per week.

6. In case of termination, what severance pay is owed to an employee under a fixed-term contract in Nepal?

An employee who is terminated during their fixed-term contract in Nepal may still be entitled to a severance payment. The amount of the severance pay will depend on the length of the contract, as set out in the Labor Act.

If the contract was for less than one year, no severance pay is required.

If the contract was for one year or longer but less than two years, an employee is entitled to 15 days’ wages for each completed year of service.

If the contract was for two years or more but less than five years, an employee is entitled to 1 month’s wages for each completed year of service.

If the contract was for five years or more, an employee is entitled to 2 months’ wages for each completed year of service.

In addition to these amounts, an employee may also be entitled to other benefits such as unpaid salary and accrued holiday pay. It is important to note that these amounts are minimum requirements and an employer may choose to offer a higher severance payment at their discretion.

7. Are employees entitled to annual leave and sick leave under their employment contracts in Nepal?

According to the Labour Act 2074 (2017), employees are entitled to annual leave and sick leave under their employment contracts in Nepal.

Annual Leave:
– An employee who has completed one year of continuous service with an employer is entitled to a minimum of 15 days of annual leave, which can be accumulated up to a maximum of 30 days.
– Employees are also entitled to an additional one day’s leave for every month of service if they have worked for more than six months but less than a year.
– Annual leave can only be taken with the consent of the employer and should be planned in advance.

Sick Leave:
– An employee is entitled to paid sick leave for up to 12 working days per year, on the condition that they provide a medical certificate issued by a registered medical practitioner.
– Sick leave cannot be accumulated from one year to another.

Maternity Leave:
– Female employees are entitled to 52 days of maternity leave, including the time required for pre and post-natal care. An additional four weeks may be granted if needed.
– Maternity leave is also granted in case of miscarriage or stillbirth.
– Maternity leave is paid at full wages and cannot be deducted from annual or sick leave entitlements.

These entitlements may vary depending on the specific terms and conditions stated in an employee’s contract. It is recommended that employees consult their employment contracts or relevant laws for more detailed information.

8. Can employers include non-compete clauses in employment contracts and are they enforceable in Nepal?

Yes, employers can include non-compete clauses in employment contracts in Nepal. These clauses are generally considered valid and enforceable as long as they meet certain conditions outlined by the Labor Act of Nepal.

According to the Labor Act, non-compete clauses must be:

1. Limited in duration: The duration of the non-compete clause should not exceed two years from the date of termination of employment.

2. Specific in geographic scope: The geographical restriction should be reasonable and necessary for the protection of the employer’s legitimate interests.

3. Reasonable in scope: The scope of activities or industries that are restricted by the non-compete clause should be limited to those directly related to the employee’s previous job with the employer.

4. Reasonable in terms of compensation: The employer must provide reasonable compensation to the employee during the period of restriction.

If these conditions are met, a non-compete clause can be included in an employment contract and enforced by law. However, if any of these conditions are not met, or if the clause is deemed unreasonable or against public policy, it may not be enforceable.

It is also worth noting that non-compete clauses cannot prevent an employee from seeking alternative employment or engaging in lawful business activities after leaving their current job. They are only meant to protect specific business interests and should not unfairly restrict an employee’s ability to earn a living.

Employers must also ensure that employees fully understand and agree to the terms of a non-compete clause before signing an employment contract. Otherwise, it may be deemed invalid on grounds of lack of informed consent.

In conclusion, non-compete clauses can be included in employment contracts in Nepal under certain conditions and are generally enforceable if these conditions are met. Employers should ensure that they comply with all legal requirements when drafting such clauses to avoid any legal issues in the future.

9. Is it legal for employers to ask employees to work on public holidays without extra pay under their contracts in Nepal?

No, it is not legal for employers to ask employees to work on public holidays without extra pay under their contracts in Nepal. According to the Labor Act of 2017, employees are entitled to receive double wages if they work on public holidays. Employers are required to comply with this law and provide fair compensation for any work done on public holidays. Failure to do so may result in legal action and penalties against the employer.

10. What is the minimum wage requirement stated by law for an employment contract in Nepal?

The minimum wage requirement for an employment contract in Nepal is set by the Government of Nepal Labour Act-2074 with a basic salary of NRs.13,450 ($120)* per month effective from July 2021.

11. Does a probation period need to be specified in an employment contract in Nepal, and if so, what is its duration limit?

Probation periods do not need to be specified in an employment contract in Nepal. However, if the employer wishes to have a probation period, it must be agreed upon and stated in the employment contract. The duration of a probation period may vary depending on the type of job and can range from one month to six months.

12. Can employers terminate employees without cause under the terms of an indefinite contract in Nepal?

No, employers cannot terminate employees without cause under the terms of an indefinite contract in Nepal. According to the Labor Act 2074 (2017), employers can only terminate an employee without just cause if there is a mutual agreement between both parties or in case of death of the employee. Otherwise, the employer must provide a valid reason for termination and follow proper procedures for dismissal, such as issuing a written notice stating the reason for termination and giving the employee an opportunity to respond. Failure to do so may result in legal action being taken against the employer.

13. Is there a mandatory notice period that employers must give before terminating an employee’s contract in Nepal?

Yes, under the Labor Act of Nepal, an employer must give a notice period of 30 days before terminating an employee’s contract. However, in some cases, if the employee has committed serious misconduct or breach of contract, the employer may terminate the contract without providing any notice period.

14. Are there any limitations on trial periods that can be included in employment contracts under the law of Nepal?

Under Nepali law, trial periods can be included in employment contracts. However, there are some limitations on the duration and conditions of such trial periods.

1. Maximum Duration: According to the Labor Act 2017, the maximum duration for a trial period is 6 months. After this period, the employee must be considered as a permanent employee.

2. Written Agreement: The trial period must be specifically mentioned in the employment contract and agreed upon by both parties in writing.

3. Remuneration during Trial Period: During the trial period, an employee must receive at least 50% of the regular salary. If any employee works during the weekend or on public holidays, they must be compensated accordingly.

4. Termination during Trial Period: Both the employer and employee have the right to terminate the employment contract during the trial period without any notice or severance pay.

5. Non-Discrimination: During the trial period, employees must not be discriminated against based on their gender, ethnicity, religion, caste, political affiliation or any other grounds prohibited by law.

6. Same Rights and Responsibilities: Employees must have all rights and responsibilities as permanent employees from day one of their trial period.

Overall, while there is no specific restriction on including a trial period in employment contracts under Nepali law, employers must ensure that they comply with these limitations to avoid any legal issues in the future.

15. How do collective bargaining agreements impact individual employment contracts within a company operating in Nepal?

In Nepal, collective bargaining agreements (CBAs) are negotiated between trade unions and employers’ organizations to set the terms and conditions of employment for workers. CBAs can impact individual employment contracts in several ways:

1. Binding Provisions: The terms of a collective bargaining agreement supersede any conflicting provisions in individual employment contracts. This means that if a CBA negotiated by a trade union requires higher wages or better benefits than an individual’s contract, the CBA will take precedence.

2. Incorporation by Reference: In some cases, individual employment contracts may explicitly refer to a collective bargaining agreement or contain language stating that the individual employee is subject to the terms and conditions negotiated in the CBA. In such cases, the CBA becomes an integral part of the individual’s contract and must be followed accordingly.

3. Minimum Standards: Collective bargaining agreements can establish minimum standards for all employees within a particular industry or occupation, including those who are not members of a union. This means that even non-unionized employees may benefit from the terms negotiated in a CBA, as they cannot be paid less than what is stipulated in the agreement.

4. Flexibility: While CBAs set certain minimum standards for employment contracts, they also allow for negotiation and flexibility at an individual level within those parameters. This means that employers may negotiate specific terms with employees that go beyond what is outlined in the CBA.

5. Grievance Redressal: Collective bargaining agreements often have provisions for grievance redressal procedures, which must be followed when there is a dispute between an employer and employee regarding their contract or working conditions. These procedures ensure fair treatment and protect employees’ rights.

Overall, collective bargaining agreements help to standardize employment practices within a company operating in Nepal by providing fair wages and benefits for workers while allowing room for individual negotiations.

16. Can employers transfer employees from one location to another within the country without amending their existing contracts?

Yes, employers can transfer employees from one location to another within the country without amending their existing contracts as long as the terms and conditions of the employment contract remain unchanged and the employee agrees to the transfer. Employers should inform their employees about the transfer in advance and provide them with all necessary information regarding the new location, such as housing arrangements, transportation options, and any other relevant details. If an employee does not agree to the transfer, it is possible for them to negotiate with the employer for a better arrangement or seek legal advice.

17.Are there any restrictions on employing foreign nationals under regular or temporary contracts inNepal?

Yes, there are certain restrictions on employing foreign nationals in Nepal.

1. Work Visa: In order to work in Nepal, foreigners must obtain a valid work visa from the Department of Immigration. The type of visa needed will depend on the nature and duration of employment.

2. Quota System: In certain industries such as manufacturing, mining, and construction, the government has set quotas for the number of foreign workers that can be hired. Companies must obtain clearance from relevant government authorities before hiring foreign workers.

3. Labor Agreement: Employers who want to hire more than 5 foreign nationals must have a labor agreement approved by the Ministry of Labour, Employment and Social Security.

4. Skills and Qualifications: Foreign employees must have specialized skills or qualifications which cannot be easily found among Nepali citizens in order to obtain a work permit.

5. Minimum Wage Requirements: Foreign employees must be paid at least the minimum wage as prescribed by the government. The minimum wage for non-skilled workers is currently NPR 13,450 per month (as of 2020).

6. Limited Duration: Work permits are usually granted for a period of up to two years but may be extended under exceptional circumstances with approval from relevant authorities.

7. Termination of Employment: If an employer wishes to terminate the employment contract before its expiry date, they must obtain permission from relevant authorities and ensure that all legal procedures are followed.

8. Restricted Sectors: Foreign nationals are not allowed to work in certain sectors such as agriculture, animal husbandry or fisheries, unless they have been granted special permission by the government.

9.Qualification Recognition: Foreign professionals wishing to work in regulated professions such as medicine, engineering or law must obtain recognition from relevant professional associations before being granted a work permit.

10. Health Insurance: Employers are required to provide health insurance for their foreign employees during their stay in Nepal.

11.Work Permit Renewal: Employers must renew their foreign employees’ work permit every year in order to continue working legally in Nepal.

It is important for employers to follow these regulations when hiring foreign nationals in Nepal. Failure to comply with these rules can result in penalties or even deportation of the foreign employee.

18.What discrimination policies should be included and enforced within all employment contracts according toNepal’s laws?

According to Nepal’s laws, the following discrimination policies should be included and enforced within all employment contracts:

1. Equal opportunity: All employees must be treated fairly and equally, without discrimination based on race, caste, ethnicity, gender, sexual orientation, religion, political beliefs or disability.

2. Non-discrimination in recruitment: Employers must not discriminate while hiring employees based on the above-mentioned factors. The recruitment process should be fair and free from any bias.

3. Pay equity: Employees should receive equal pay for work of equal value, regardless of their gender or other personal characteristics.

4. Harassment-free workplace: Employers must prohibit any form of harassment or bullying in the workplace based on personal characteristics such as sex, gender identity or expression, sexual orientation, race or religion.

5. Accommodation for disabilities: Employers are required to make reasonable accommodations for employees with disabilities to enable them to perform their job duties effectively.

6. Maternity and paternity leave: Employers must provide equal opportunities for both mothers and fathers by offering maternity and paternity leave.

7. Time off for religious holidays: Employers are required to allow employees to take time off for religious holidays they observe without discriminating against them.

8. Non-discrimination in promotion and training opportunities: All employees should have equal access to training and promotion opportunities based on their skills and qualifications without any form of discrimination.

9. Prevention of age discrimination: Employers are prohibited from discriminating against individuals based on their age in hiring, promotions, training opportunities or any other aspect of employment.

10. Inclusive work environment: Employers should create a positive work environment that promotes diversity and inclusion and does not tolerate discriminatory behavior.

It is important for employers to actively enforce these policies within their organization through proper training and strict disciplinary action against any employee found guilty of violating these policies.

19.Can an employee be subject to disciplinary action or termination for breaches of their employment contract in Nepal?

Yes, an employee can face disciplinary action or even termination for breaches of their employment contract in Nepal. As per the Labor Act 2074 (2017), employers are entitled to impose penalties such as warning, fine, suspension or dismissal for misconduct, negligence or other breaches of the employment contract. However, the employer must follow the legal procedure and provide the employee with an opportunity to explain themselves before imposing any penalty.

The employment contract typically outlines the terms and conditions of employment, including expected behavior and job responsibilities. If an employee fails to fulfill these obligations or violates any specific clauses in the contract, they can face disciplinary action or termination.

However, in cases of disciplinary action leading to dismissal, the employer must have sufficient evidence to prove the employee’s misconduct or breach of contract. The employer is also required to follow due process and give a valid reason for terminating the employee’s contract.

The actions that could result in disciplinary actions or dismissal vary based on the nature of work and provisions outlined in the employment contract. Some common offenses that could lead to disciplinary action include unexcused absences, habitual tardiness, insubordination, fraud or theft, and violation of company policies.

Additionally, keeping in line with labor laws in Nepal and international labor standards, employers cannot terminate an employee without a valid reason related to their work performance or behavior. Unfair dismissals are not allowed under Nepali law and can result in legal consequences for employers.

In conclusion, while an employer has the right to take disciplinary measures or terminate an employee for breaches of their employment contract in Nepal, it must be done following proper procedures and with just cause. Employees also have rights and legal protections against unfair treatment by employers.

20. What legal protections are available to employees who report violations of their contracts or labor laws by their employer in Nepal?

There are several legal protections available to employees who report violations of their contracts or labor laws by their employer in Nepal:

1. Whistleblower Protection Act, 2011: This act protects individuals who disclose information regarding corruption, abuse of authority or other illegal activities committed by any individual or organization. It also provides protection against retaliation for whistleblowers.

2. Labor Act, 2074 (2017): This act prohibits discrimination and retaliation against employees for exercising their rights under the law, including reporting violations of labor laws.

3. Labor Rules, 2075 (2018): These rules provide guidelines for the implementation of the Labor Act and include provisions for complaints and disputes related to disciplinary actions taken against employees for reporting violations.

4. Procedural Law, 2074 (2017): This law provides protection to employees from termination without reasonable cause and without following proper procedures.

5. Trade Union Act, 2049 (1992): This act allows trade unions to take legal action on behalf of employees who have been subjected to unfair treatment or retaliation for reporting violations.

6. Human Rights Commission Act, 2063 (2006): The Human Rights Commission has the power to investigate complaints related to violation of human rights, including those related to employment.

7. Courts: Employees can also seek legal protection through courts by filing a case against their employer for violating their contract or labor laws.

In addition to these legal provisions, some employers may also have internal policies and procedures in place for handling employee grievances and complaints about violations of contracts or labor laws. It is important for employees to be aware of their rights and the available avenues for seeking redressal in case of any violation by their employer.