Labor law in Laos

The Labour Law applies to employers and employees in Laos, including Lao employees of foreign organizations and foreign employees working in Lao PDR. It generally excludes government officials, soldiers and police serving in Party or Government structures. Household work is handled under the applicable household contract. The national law governs the country; no separate provincial or capital labour-law regime is established in the available legal basis. A legal entity or organization must use a written employment contract. Two individual persons may agree verbally. A contract can be for a fixed or indefinite period. A fixed-term contract, including extensions, may not exceed three years, and an extension should be made within 60 days. The contract should identify the parties, duties, pay, duration, workplace address, payment method, probation, welfare, working and rest time, holidays and termination benefits. Probation may last up to 30 days for unskilled work or 60 days for skilled work. Pay during probation must be at least 90% of the agreed wage. Notice is three days for unskilled work and five days for skilled work, and the employer should confirm the employment in writing seven days before probation ends. Normal working time may not exceed six days per week and eight hours per day or 48 hours per week. Hazardous work is limited to six hours per day or 36 hours per week. The lunch break must last at least 60 minutes and is separate from working time. Employees receive at least one rest day each week or four rest days each month. Night work runs from 22:00 to 06:00; night workers should receive at least seven consecutive hours of night rest and at least 11 hours of daily rest. A shift may not exceed eight hours. Overtime requires advance consent from the trade union, employee representative or majority of employees. It is generally limited to three hours per day, 45 hours per month and four consecutive days, except in an emergency. Work exceeding 45 overtime hours per month requires approval from the Labour Administration Agency and the relevant union, representative or employee majority. Overtime pay is 150% for work between 17:00 and 22:00 on a normal workday and 200% between 22:00 and 06:00. Work on a weekly rest day or public holiday is paid at 250%; the listed rates rise to 300% for 16:00 to 22:00 and 350% for night work. Night or shift work also carries a premium of at least 15% where the applicable rule requires it. After one year of service, annual leave is at least 15 paid days, or 18 paid days for hazardous work. Certified sick leave is paid for at least 30 days per year under the applicable conditions; daily, hourly and piece-rate workers generally qualify after more than 90 days of work. Public holidays include 1 January, 2 December, three days for Lao New Year, 1 May, 8 March for women and 7 October for teachers. If a holiday falls on the weekly rest day, a replacement day applies. Listed family or emergency events provide at least three paid personal-leave days. A government notice effective from 1 October 2024 sets a minimum monthly wage of 2,500,000 LAK for private production, business, service and household sectors. This amount excludes overtime, welfare and other benefits. An unskilled worker without formal education or training is covered by a 900,000 LAK subsistence allowance under the stated rule. Daily and piece-rate work must still produce at least the applicable monthly minimum when calculated over the month. Wages may be paid in cash or partly in kind only when agreed, and the employer should keep a payment record or receipt. The employer may not deduct employment-binding or placement fees from pay. The law requires equal and fair pay and prohibits forced labour. Employers must reserve 1% of annual salary expenditure for worker training. Pregnant employees and employees with a child under one year may not be assigned night work, overtime, rest-day work, lifting above 10 kilograms, more than two hours of standing, work at heights above two metres or hazardous work. A temporary suitable transfer must preserve the same pay. Maternity leave is at least 105 days, including at least 42 days after childbirth, or 120 days for twins, with full pay under the applicable rules. Children aged 14 to 17 may work subject to protective restrictions. Children aged 12 to 13 may perform only light work that does not obstruct school or training. Workers under 18 may not perform hazardous work or the worst forms of child labour. The current rules also distinguish light and hazardous work through the 2023 Ministry of Labour and Social Welfare agreement. Employers must assess occupational risks at least once a year, provide safe workplaces and equipment, supply personal protective equipment, and provide safety information and training at least once a year. Construction and mining workplaces need a designated safety person. A workplace with more than 100 employees needs a safety unit or safety board. The employer or the National Social Security Organization bears treatment costs for occupational accidents and diseases under the applicable social-security rules, and normal pay continues during treatment or rehabilitation for up to six months. Social security registration is mandatory for a labour unit with at least one employee. The employer and employee should submit registration within 30 days after hiring or signing the contract. The National Social Security Organization, or NSSO, is the body under the Ministry of Labour and Social Welfare that administers the system; it aims to issue a certificate or card within 30 days after receiving complete documents. The statutory contribution rates recorded for the system are 6% for the employer and 5.5% for the employee on insurable earnings, subject to later actuarial or regulatory adjustment. Benefits include health care, employment injury, occupational disease, maternity, sickness, invalidity, retirement, death, survivors and unemployment support. Unemployment benefit generally requires at least 12 months of contributions during the previous 24 months, involuntary unemployment and at least 30 days without work. The benefit is 60% of average insurable earnings during the last six months, for three, six, nine or twelve months depending on the contribution period. Maternity benefit requires at least nine months of contributions during the previous 12 months and pays 80% of average earnings for 105 or 120 days; the employer pays any required difference. The baseline retirement thresholds are age 60 for men or 55 for women with at least 15 years of contributions, with lower age thresholds for qualifying hazardous work. A labour unit with at least 10 employees must have an employee representative or a grassroots trade union. A trade union may be established after the labour unit has operated for at least six months. Representatives and unions may protect employee interests, participate in employment contracts and internal rules, negotiate collective labour contracts, and raise issues involving pay, working conditions and social security. A collective labour contract is submitted to the Labour Administration Agency and is registered or notarized by a court. Laos has ratified ILO Conventions C100, C111, C138, C182, C155, C187 and C144, while C087 and C098 are not recorded as ratified in the applicable research basis. For an indefinite contract, the employee or employer normally gives 30 days' notice for physical work or 45 days' notice for mental work. A fixed-term contract ends by mutual agreement, expiry or a breach covered by law. Retrenchment requires consultation with the union, employee representative or employee majority, a written reason and notice to the Labour Administration Agency. Misconduct may justify termination without compensation in listed cases, including deliberate damage, repeated rule violations after a warning, four consecutive days of absence, certain convictions or rights violations after a warning. Termination is protected during pregnancy, while caring for a child under one year, and during medical treatment or rehabilitation. A termination without sufficient reason, involving abuse of rights or forcing an employee to resign after an unresolved protest may be unjustified. Remedies can include reinstatement, other work or compensation. Ordinary compensation is calculated as 10% of the last pay multiplied by the months worked; unjustified termination uses 15% under the stated rule. During the notice period, an employee may take one paid day per week to look for work. Labour disputes include disputes about applying law, contracts or internal regulations and claims seeking new benefits. The usual path begins with a peaceful internal compromise involving the union or employee representative and a written signed record. A district or municipal Labour and Social Welfare Office may mediate, and the Labour Administration Agency may issue an administrative resolution. Benefit disputes may proceed to the Committee for Labor Dispute Resolution and then to a People's Court or Labour Court. International disputes may use the Agency, the Committee or an applicable international agreement. Work normally continues while a dispute is pending, except in a serious case or a stoppage approved through the required tripartite process. Strikes must comply with the law and regulations. The Ministry of Labour and Social Welfare directs the system. Provincial or capital Labour and Social Welfare Departments and district or municipal offices handle local administration, mediation and related services. The Labour Administration Agency handles labour administration, permits, mediation and inspection. Inspections may be routine with advance notice, sudden, follow-up or special inspections. Inspectors can examine contracts, internal rules, pay, working hours, overtime, social security, safety, welfare, and the employment of foreign, child and female workers. An officer should show identification before an inspection, and the employer signs the inspection report. Sanctions can include a warning, fine, business suspension, licence withdrawal, court action and civil compensation. Foreign workers generally need to be over 20 and meet requirements concerning skills, position, health, criminal record, quotas and work permits. Employers are expected to give priority to Lao workers, maintain a capacity-building plan and comply with permit-return and departure duties. Formal rules therefore provide a broad framework, but informal and unregistered employment can make access to contracts, social security, safety protections and dispute remedies more difficult. The current legal basis does not establish a reliable public fee tariff for every dispute, inspection or work-permit procedure, so the responsible authority should confirm current charges and processing times.