Laos EOR & PEO

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Hire in Laos

The Lao People’s Democratic Republic, Lao PDR, or Laos, is a small landlocked Southeast Asian country bordered by China, Vietnam, Cambodia, Thailand, and Myanmar. Previously an independent kingdom and a French and Japanese-occupied territory, Laos became an independent socialist republic in 1975. Since that time, the country’s GDP has grown tremendously, peaking at $18.77 billion in 2019 but decreasing during the pandemic. It now sits at $15.2 billion but is predicted to grow by 4.0% in 2024. The population of 7.686 million is largely engaged in agricultural production. However, economic growth has been driven by industrial development in mining and hydropower. Unemployment in Laos is low, reaching roughly 3.8% last year. It’s a good time to hire Lao workers, and working with an EOR is the best way to do it.

Facts & Stats

hire employees in Laos

What Is a Laos EOR?

An employer of record, or EOR in Laos, is a service provider that hires workers on behalf of other companies. This arrangement allows foreign-based companies to legally hire Lao workers without needing to register business entities in the country. This saves them time, money, and effort. To get Lao workers working for them quickly, clients can simply pay the EOR a fee for each person it hires and manages. The EOR handles the workers’ human resources (HR) needs over the long term while you take care of their day-to-day schedule and tasks.

Save Money And Time with A Laos EOR

What Are the Benefits of a Laos EOR?

Working with an EOR in Laos is one of the best ways to get Lao workers on board with your organization. The advantages you can gain from working with a Lao EOR include:

Not needing an entity: The biggest advantage of partnering with an EOR is that it allows you to hire Lao workers without needing to own an entity. To hire Lao workers on your own, you’d need to register a company in Lao, which would entail a large commitment of time, energy, and money. Instead, an EOR can take on the role of the workers’ legal employer while contracting to work directly for your company.
Language skills: Lao is the official language of Laos, a language highly related to Thai, and many Lao people also speak other minority languages like Khmu and Hmong. Due to its history with France, the country also has a high level of French, and English is used for international trade and diplomacy. These language skills can smooth communication with Lao workers and be valuable assets for companies doing business in the region and internationally.
Fast recruitment and onboarding: Most EORs can recruit workers quickly, either by using their own labor pools or strategically advertising their vacancies. Recruitment and onboarding can take as little as a few hours but is normally completed within a week or two. If you try to recruit Lao workers on your own, you’d likely take several weeks or months to find the talent you need.
Affordability: Laos is a lower-middle-income country. Lao salaries are quite low, and employers only have to pay 6% of workers’ salaries for social programs. This can make Lao employees highly affordable.
Constant compliance: When you work with an EOR to hire your employees in Lao, you gain the help of experts in Lao tax and labor laws. These professionals help you to ensure that the working conditions you agree on in your workers’ contracts are fair and in compliance with local statutes. They also handle payroll calculations to make sure that taxes and social security contributions are paid correctly. This protects your company from the dangers of fines and other penalties due to non-compliance.

Horizons is Best IN Class

Why Choose Horizons?

Horizons stands out as a Laos EOR through:

A strong regional presence in the Asia-Pacific region, meaning senior management are on the ground to deal with any issues.
Client-focused infrastructure. Horizons won’t oversell you on products and services you don’t need. Horizons offers the easiest platform to compliantly hire and pay people worldwide.
Cost-effective solutions. At $499 per employee, per month, no EOR in Laos is more affordable. The cost is 100% transparent (onboarding, offboarding, deposit, no extra charges).
A customer-first culture. Horizons is an efficient bootstrapped company. It is not an externally-funded company burning investor cash to aggressively acquire new clients. Horizons is the only EOR that grows with its customer, reflecting the level of care and personal attention provided to each customer. Horizons will carefully advise on the best setup in each country: the type of contract needed, how to structure your benefits, and how to offboard a person while minimizing the risk of conflicts and extra cost
A long-term partnership. Horizons is the only EOR platform with a recruitment arm — a direct response to client demand. If any employee is leaving, or if our clients want to explore a new country, Horizons can recruit new candidates directly for the client. Horizons is:
- The only EOR doing this in-house — no subcontracting
- The only EOR doing this without a retainer — clients are only charged upon success
- The only EOR charging just a 2% fee per month.

Step-by-step Laos EOR

How Does a Laos EOR Work?

When you work with an EOR in Laos, you can leverage a valuable partner that can help you recruit and manage local employees quickly and easily. These are the services you can normally expect from an EOR:

Hiring your employees: While you may have already identified the Lao workers you wish to employ, some EORs offer recruitment services for companies looking for workers. An EOR can find out from you what your recruiting needs are and looking its labor pools or advertise publicly to find the talent that you require. Once suitable candidates are found, the EOR can hire them by entering into contracts with them directly and becoming their sole legal employer in Laos.
Managing employment contracts and onboarding: You can work with the EOR to determine the working conditions, benefits, and compensation you want to offer your employees. You may be able to negotiate with the employees to come to terms, and then these terms will be included in the contracts that the EOR prepares. After they’re officially hired, the EOR can start onboarding your new workers. They normally do this through their online platforms where workers can upload their important documents and sign agreements. The workers will be registered with the local tax and social security authorities, and then they’ll be able to begin working.
Processing payroll and handling employment taxes: Most EORs offer global payroll services aside both for companies that have their own entities around the world and for those in need of EOR services. To take advantage of their payroll services, you’ll need to collect worked hours data for your employees and send this to the EOR. With this data, it will calculate their gross salaries, their tax withholdings, and social security contributions for both you and the employees. The EOR will remit these contributions and tax payments to the authorities and then disperse the rest as the workers’ net salaries. It will keep all of its payroll information for your records and generate detailed payslips for the benefit of your workers. Your company will be invoiced regularly to attain the funds needed for these payments.
Administering benefits: The EOR will manage each employee’s mandatory benefits according to their country, including things like maternity leave, vacations, and public holidays. You can also offer additional benefits like private pensions and health insurance to increase your workers’ compensation packages. If you do, the EOR can normally manage these for you as well.
Taking care of exit procedures: There will come a time when you need to terminate workers. You’ll be able to let the EOR know your causes, but it’s the EOR’s responsibility to follow through with the terminations as the legal employer of your workers. It will calculate notice periods and severance, if necessary, according to the law and give these to the employees as needed.

stay compliant with Laos labor laws

Labor Laws

As a socialist country, Laos has extensive laws that provide strong protections for workers. These statutes are spread over various legal instruments such as the Law on Social Security, The Constitution of the Lao People’s Democratic Republic of 1991 (revised 2015), and the Labor Law (amended 2007), as well as other articles and orders. However, it’s the responsibility of the EOR’s legal staff to have expert knowledge of all of these laws. Still, it’s useful for you to know the main points of law that help you understand what you need to provide for your Lao employees.

Employment contract types

Contracts must be made in writing. They can be permanent (indefinite) or fixed-term (definite). Fixed-term contracts cannot be made for longer than three years.

Probationary periods in Laos cannot exceed 30 days for primarily physical work and 60 days for skilled work. During probation, a worker must be paid no less than 90% of the normal wages for that work.

Project-based

Fixed-term

Indefinite

Working hours in Laos

The standard working hours in Laos are 8 hours per day, six days a week, for a total of 48 hours per week. Overtime is allowed only by mutual agreement between the employee or trade union and the employer. These overtime hours must not exceed three hours per day or 45 hours per month.

Overtime must be compensated in the following way:

Holiday Schedule in Laos [2024]

Laos employees are entitled to at least ten paid public holidays each year. These holidays combine national and religious (Buddhist) observances.

Foreign workers in Laos are allowed one day off for their national day in addition to these holidays.

Laos’ public holiday schedule for 2024 is:

Date	Holiday name
1 Jan, 2024	International New Year’s Day
8 Mar, 2024	International Women’s Day
15 Apr to 18 Apr	Lao New Year
1 May, 2024	International Labor Day
22 Jul, 2024	Lao Women Union’s Day
17 Oct, 2024	End of Buddhist Lent
15 Nov, 2024	That Luang Festival Day
2 Dec, 2024	Lao National Day

Paid time off

Workers in Laos are entitled to a paid five-to-ten-minute break after working for two hours, a paid 45-minute meal break during each shift, and at least one 24-hour period of rest each week.

Sick leave in Laos

Employees are entitled to up to 30 days of sick leave per year with the presentation of a valid medical certificate.

Less than 6 months of sick leave:

(percentage of regular wages owed to the employee)

Over 6 months of sick leave

In order for employees to receive the full wages due to them, workers must present a valid medical certificate from a certified doctor to their employer.

Maternity leave in Laos

Expecting mothers are entitled to a minimum of 90 days of fully paid maternity leave, at least 45 of which must be taken after giving birth. There is no mandate for paternity leave in Laos.

Annual leave in Laos

Employees with indefinite contracts or those working on definite contracts for over one year are entitled to 15 working days of annual leave. Those who perform heavy work that could be hazardous to their health are entitled to 18 days per year.

Termination & severance in Laos

Employers can terminate workers for gross misconduct. Termination for any reason must be proceeded by notification to the worker’s union or labor unit, and that unit has 15 days to reply to the notification. Fixed-term contracts can be terminated with 15 days’ notice. Permanent contracts can be terminated with 30 days’ notice for primarily physical work and 45 days’ notice for skilled work. When workers are dismissed, they are to be paid 10% of their monthly salary as severance if they have given less than three years’ service to an employer and 15% after more than three years.

Laos' compulsory social security contributions

Social security contributions are governed by the National Social Security Fund (NSSF), which is responsible for managing social security benefits for workers.

Contribution is at 11.5% of the employee’s gross monthly salary, split between the employer and the employee.

These contributions are mandatory and ensure that employees have access to various social security benefits, providing a safety net for health, maternity, sickness, injury, disability, retirement, and survivorship.

Laos social security for foreigners

Foreign employees working for a Lao company are generally required to contribute unless exempted by a specific bilateral agreement between Laos and the foreign employee’s home country.

Individual income tax

Income tax is levied on the income of residents and non-residents working in the country. The tax system in Laos is progressive, meaning that the tax rate increases as income increases.

Non-residents are generally taxed at a flat rate of 10% on their income derived from sources within Laos.

Health insurance

Public health insurance in Laos is provided through the National Social Security Fund (NSSF), which is part of the country’s broader social security system. This insurance covers both public and private sector employees.

Private health insurance is also available and is often chosen by expatriates and those seeking more comprehensive or international coverage.

hassle-free Lao compensation & benefits

Compensation & Benefits

Laos compensation laws

The state-mandated minimum salary in Laos is 1.6 million LAK (Laos kip)/month (about 75 USD/month).

Regular daytime overtime hours must be paid at a rate of 150% of a worker’s normal wages. Nighttime overtime hours are paid at 200% of normal wages. Hours worked on weekly rest days must be paid at 250% of normal wages and at night 300%.

13 month salary in Laos

A 13th-month annual bonus is not mandatory in Laos. While not mandatory, some employers may choose to grant an annual bonus to incentivize their workers.

Social security for Lao nationals

Employers in Laos pay contributions equal to 6% of a worker’s salary to the National Social Security Fund. Employees are deducted 5.5% of their salary for the same to receive old age, invalidity, survivor’s, sickness, maternity; accident, occupational disease, and unemployment benefits.

Laos Employer Of Record Peo

Navigation

Hire in Laos

What Is a Laos EOR?

What Are the Benefits of a Laos EOR?

Why Choose Horizons?

How Does a Laos EOR Work?

Labor Laws

Employment contract types

Working hours in Laos

Compensation & Benefits

Frequently asked questions

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Frequently asked questions

How does an EOR in Laos handle local labor law compliance?

The EOR’s legal experts keep track of updates to labor laws at all times. Their recommendations help the EOR produce contracts that are fully compliant. The EOR manages payroll for you, which means it ensures that taxes and social security contributions are paid on time and correctly.

What are the key benefits of using an EOR for hiring in Laos?

When you work with a Laos EOR, you’re able to outsource to it many of your HR functions like payroll, contract management, and benefits administration. The EOR manages compliance while you direct your workers’ daily activities and schedules. All this is done without your company needing to spend time and money registering a business entity in Laos.

Laos EOR & PEO

Start hiring in Laos

Simple, compliant hiring with Horizons EOR & PEO

Hire in Laos

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hire employees in Laos

What Is a Laos EOR?

Save Money And Time with A Laos EOR

What Are the Benefits of a Laos EOR?

Horizons is Best IN Class

Why Choose Horizons?

Step-by-step Laos EOR

How Does a Laos EOR Work?

stay compliant with Laos labor laws

Labor Laws

Employment contract types

Project-based

Probationary period

Termination

Severance

Fixed-term

Probationary period

Termination notice period

Severance

Indefinite

Probationary period

Termination notice period

Severance

Working hours in Laos

Overtime must be compensated in the following way:

For a regular workday:

For a rest day:

For a statutory holiday:

Paid time off

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Sick leave in Laos

Less than 6 months of sick leave:

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Over 6 months of sick leave

Under 1 year of employment

1-3 years of employment

3+ years of employment

Maternity leave in Laos

Annual leave in Laos

Termination & severance in Laos

Laos' compulsory social security contributions

Laos social security for foreigners

Individual income tax

Health insurance

hassle-free Lao compensation & benefits

Compensation & Benefits

Laos compensation laws

13 month salary in Laos

Social security for Lao nationals

Hire in Laos in 24h without your own local entity.

Frequently asked questions

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