Key Takeaways

  • An EOR relieves companies of their administrative duties, streamlining their operations.
  • Most EORs charge a one-time onboarding fee and monthly service fee.
  • The EOR will be responsible for ensuring ongoing compliance with Brunei labor and taxation laws.
  • When choosing an EOR provider, companies should prioritize the provider’s legal expertise and proven experience.

Are you thinking about expanding your team into Brunei Darussalam (Brunei for short)? Hiring in Brunei can offer exciting opportunities, but navigating local labor laws and administrative requirements can be complex. One of the fastest and most cost-effective ways to build your team is by partnering with a Brunei Employer of Record (EOR).

In this guide, we’ll walk you through how Brunei EOR services work, the pros and cons to consider, and how to choose the right EOR provider to support your expansion.

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What Is a Brunei EOR?

A Brunei Employer of Record (EOR) is a third-party provider that serves as the official employer for a global company’s local team in Brunei. Rather than forming a Brunei-based subsidiary, foreign or domestic businesses can use an EOR to hire staff while following the country’s Employment Order 2009. The EOR creates employment contracts, registers workers with relevant government bodies, and makes sure every step complies with Bruneian labor requirements.

In addition to drafting contracts, a Brunei EOR takes responsibility for payroll duties and benefit management. This includes handling tax deductions, Tabung Amanah Pekerja (TAP) contributions, and any compulsory insurance provisions. By monitoring changes in regulations, the EOR shields companies from penalties tied to non-compliance. If there are employment disputes, the EOR addresses them according to local laws, further reducing the client company’s risk. Some Brunei EORs also offer additional HR-related services such as Brunei recruitment. 

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How Does a Brunei Employer of Record Work?

Instead of setting up a subsidiary, foreign businesses contract with the EOR to hire and manage staff locally. This arrangement relieves the client from establishing a legal entity and enables a faster market entry.

Brunei EOR

Under this model, the EOR takes on several core responsibilities:

  • Drafting and signing employment contracts in line with the Employment Order 2009
  • Handling payroll, including salary calculations, tax withholdings, and Tabung Amanah Pekerja (TAP) contributions
  • Ensuring compliance with labor, health, and safety standards, and any updates to Brunei’s employment regulations
  • Managing benefits and insurance according to local laws and industry practices

Since Brunei’s economy is driven by oil, gas, and a growing service sector, the EOR model can be especially valuable for companies in these industries looking to hire specialists or scale teams quickly. The EOR stays current with labor regulations and market conditions, helping foreign businesses maintain proper documentation and fulfill mandatory obligations. If an employment dispute or legal issue arises, the EOR liaises with the relevant government bodies and follows due process under local law, reducing the administrative burden on the client.

Brunei EOR vs Brunei Entity

The most common method of expanding in Brunei is by setting up a legal entity.  Directors will need to choose a legal structure, register their business with the Ministry of Finance and Economy, and apply for any industry-specific licenses. Whilst incorporating a business in Brunei allows employers to grow their presence on the ground and expand their in-country operations, the incorporation process can be both time-consuming and costly.

Conversely, using an EOR, companies can enter the Brunei market and hire local talent without hiring office space, paying for workplace facilities ,or making a long-term financial commitment to in-country staff. The EOR will also protect companies from financially damaging legal penalties by ensuring ongoing compliance with Brunei labor and taxation laws. Consequently, using an EOR can be both more cost-effective and efficient than setting up a legal entity.

Is an EOR in Brunei Legal?

Yes, using an Employer of Record (EOR) is legal in Brunei. Under Brunei’s labor regulations, companies are permitted to engage third-party HR providers to assist with employment-related responsibilities, including hiring, payroll management, and compliance with local labor laws.

However, it’s important that both the company and the EOR provider ensure full compliance with Brunei’s Employment Order 2009 and related workforce regulations, including proper employment contracts, benefits administration, and foreign worker permits when applicable. Partnering with an experienced EOR helps businesses stay aligned with all legal requirements while minimizing administrative risk.

How Much Does a Brunei EOR Cost?

The cost of partnering with an Employer of Record (EOR) in Brunei depends largely on the scope and complexity of the services provided, as well as the number of employees being managed. Typically, EOR providers charge:

  • A one-time onboarding fee to cover the administrative costs of registering and setting up new employees
  • A monthly service fee per employee for ongoing payroll, compliance, and HR management

In some cases, additional charges may apply for customized HR support, enhanced employee benefits packages, or visa and work permit assistance for foreign workers.

Before signing an agreement, it’s important for companies to request a clear, detailed breakdown of all fees to avoid unexpected costs. A reputable EOR will be transparent about pricing and flexible in tailoring services to fit your business needs.

How Does a Brunei EOR Help with Payroll and Taxes?

A Brunei Employer of Record (EOR) manages all critical aspects of payroll and tax compliance on your behalf. This includes calculating employee salaries, withholding the correct amounts for government contributions, filing tax returns, and ensuring timely payments to the relevant authorities.

The EOR also handles mandatory contributions to Brunei’s Employee Trust Fund (TAP) and Supplemental Contributory Pension (SCP) schemes, which are required for local employees. With in-depth knowledge of Brunei’s tax and social security laws, a trusted EOR ensures that all payroll activities remain fully compliant, minimizing your company’s risk of errors, penalties, or delays.

How Does a Brunei EOR Help with Benefits Administration?

Under Brunei’s employment laws, employees are entitled to a range of statutory benefits, including maternity leave, sick leave, disability benefits, annual leave, unemployment benefits, and pension contributions through programs like TAP and SCP. A Brunei EOR is responsible for administering these benefits on behalf of the employer, ensuring that all entitlements are managed accurately and in full compliance with local labor regulations.

Beyond mandatory benefits, an experienced EOR can also assist businesses in developing enhanced benefits packages, such as additional health insurance coverage, performance bonuses, or employee wellness programs, helping companies stay competitive in attracting and retaining top talent in the Brunei market.

What Labor Laws Apply to Hiring in Brunei?

The Employment Order 2009, Workmen’s Compensation 1957, and the Workplace Safety and Health Order 2009 are the main legal frameworks that govern labor relations and working conditions in Brunei.

In 2023, the Brunei government introduced the Employment (Minimum Wage) Order which sets minimum wage rates for different industries. Employers are legally required to pay their workers a wage that is equal to or higher than the wage set by the Employment Order.

Employment Contracts

The Employment Order, 2009, is Brunei’s governing law for employment contracts. Written contracts are not compulsory under Brunei law but are strongly recommended. However, a written employment contract is required for foreign workers to apply for work permits and for engagements longer than 6 days. The Department of Labour encourages all employment arrangements to be in writing, as oral agreements are generally less secure. The written employment agreement is expected to specify job descriptions, salary, working hours, and other benefits.

The employment relationship can be made permanent, temporary, or contract-based. Permanent employment would give more job security. Contract employment is common, especially for foreign workers, and is usually commensurate with the work permit’s validity. The contract should always state the employment period and basic terms for all parties’ protection.

Working Hours 

Employment Order 2009 specifies a maximum of 8 hours a day or 44 hours a week, generally to be worked over six days (Monday to Saturday). Exceptionally, work may be extended for up to 48 hours a week if the average for the same number of alternating weeks does not exceed 44 hours.

Overtime is paid at 1.5 times the basic rate for the first 2 hours and double time after that. Overtime on rest days is double time. The maximum number of hours worked in any day is 12, with overtime included, except in emergencies. All employees must have at least one full day off per week.

Probation Periods

In Brunei, the maximum probation period is six months for all roles. Both employers and employees can terminate the contract with only one day’s notice during probation, which gives the employee less job security but allows both parties to test the working relationship. Probationary employees have the same fundamental rights as confirmed employees, such as fair treatment and payment of wages, but they may not be entitled to the same benefits. The employment contract must specify the probation period and can not be extended more than six months unless the employee agrees in writing.

Social Security

The Employee Trust Fund (TAP) operates the social security system in Brunei. Employers and employees contribute 5% each, totalling 10% contributions of the employee’s monthly salary to TAP. TAP is the main pension scheme for employees, who can withdraw from it at retirement age of 60, or due to permanent disability or emigration. 

Healthcare in Brunei is provided through a public system managed by the government that offers free or subsidised medical services for citizens and residents. Some foreign workers may require private health insurance based on their visa requirements. Brunei’s social security system is a product of its oil wealth and a strong emphasis on providing for the welfare of the workforce.

Payroll and Employment Taxes in Brunei

Minimum Wage

Brunei implemented a national minimum wage with the Employment (Minimum Wage) Order, 2023. All full-time employees should be paid at least B$676 per month, and part-time workers should be paid a minimum of B$3.55 per hour. 

Income Tax

Brunei is one of the very few countries in the world that does not tax personal income from employees. This means that an expat working in Brunei can keep all of the earned money. In terms of payroll, it will be the employer’s responsibility to maintain proper payroll records to ensure correct TAP contributions. Social security contributions are another payroll consideration. This will also include work permit fees for foreign workers. 

Although personal income tax is not required by law, full payroll documentation is required for auditing and labor law compliance. The employer should keep records for wages, hours worked, overtime, and leave.

13th Month Pay

The payment of 13th-month pay is not required by law; however, many employers provide it as a benefit. The 13th-month pay is a bonus provided by some companies, equivalent to 1 month of the basic salary. It is usually provided in December; however, larger corporations tend to pay this to their employees.

It is a common practice for employers to offer more benefits to their employees than the law requires. It is usually calculated from the basic salary and is prorated on the months worked if an employee has not served a full year in the company.

Work Permits and Visas in Brunei

All foreign workers must obtain work permits from the Labour Department. They are usually issued for a particular employer and position and have a duration matching a one—or two-year employment contract. Documents required for a work permit application are education certificates, professional qualifications, a medical examination, a police clearance, and proof of experience. 

Employers must hire locally before hiring foreign workers, except in specific cases, such as some specialised positions. 

Remote People can help companies through the work visa process, from preparing supporting documents and liaising with government agencies to sponsoring visas for companies unfamiliar with the Brunei immigration process.

Hiring Contractors in Brunei

Contractors offer greater flexibility as they can be hired through service agreements rather than employment contracts. Independent contractors can decide when, how, and with what equipment the work is performed. They are also free to engage in work for other clients at the same time. Independent contractors must cover their own business expenses and may need to obtain business licences in some cases, depending on the nature of the services provided.

There is no GST/VAT applicable in Brunei at this time. As such, there are no contractor tax implications to consider when invoicing and receiving payment from local businesses. Service agreements are essential between companies and independent contractors. They can protect both parties and ensure clarity in the scope of work, payment terms, deliverables, and termination conditions.

Workers' Compensation in Brunei

The Workmen’s Compensation Act, 1957, protects employees who are injured or become ill at work in Brunei. Employers are legally obligated to pay compensation or provide insurance for their employees.

In case of a temporary disability, the injured employee will receive 66.7% of their average wage after four days. This benefit can be paid for a maximum of five years, but only up to a monthly amount of B$130. If an employee is permanently disabled, they will be entitled to a lump sum payment of 60 times their monthly income, or B$36,000, whichever is less. There are also additional allowances for workers who require constant care or have partial disabilities.

Time Off and Leave in Brunei

Leave policies in Brunei ensure employees get enough rest and time off as required by law and common practice.

Mandatory Leave Entitlements

The employee is entitled to 7 days of annual leave after one year of service, 14 days after two years of service, and a maximum of 21 days after five years of service. Employees also get paid leave for 11 public holidays, such as National Day, the Birthday of the Sultan, and Islamic Holidays.

Sick Leave

In Brunei, employees are entitled to not less than 14 days of paid outpatient sick leave and 60 days of paid hospitalization leave per year. This is for employees who have completed at least six months of continuous service. Employees are also required to provide a medical certificate issued by a company-approved doctor or government hospital/clinic, and also notify their employer within 48 hours from the time of sickness.

Maternity Leave

Female employees are entitled to 105 days (15 weeks) of maternity leave with full pay, irrespective of their period of service. This leave can be taken both before and after delivery, as per medical advice. Dismissal or discharge of female employees during pregnancy or maternity leave is prohibited by law.

Parental Leave

In Brunei, there is no statutory paternity leave. Some employers may offer a few days of paid or unpaid leave. However, no law states that new fathers should get any leave. They are usually expected to use their paid sick leave or other leave if they want to take time off around the birth of their child.

Other Leave

Other leave comprises compassionate leave for the loss of a family member (2-3 days), marriage leave (3 days), pilgrimage leave for Muslim employees who perform Hajj, and study leave, which can be taken by an employee for professional development and is taken at the discretion of the employer.

Terminations and Severance in Brunei

In Brunei, termination of an employee is regulated by the Employment Order of 2009, which requires the employer to give the employee a written notice of termination. The notice periods are as follows: 

Length of Continuous ServiceNotice Period
Less than 26 weeks1 day
26 weeks but less than 2 years1 week
2 years but less than 5 years2 weeks
5 years or more4 weeks

Alternatively, notice may be waived or replaced by payment in lieu, by agreement between the employer and the employee.

There is no statutory requirement for severance pay under the Employment Order.

Pros and Cons of Using an Employer of Record (EOR) in Brunei

Partnering with an Employer of Record (EOR) in Brunei offers many advantages, but it’s important to weigh both the benefits and potential trade-offs before moving forward.

  • Pros

Faster Market Entry

An EOR enables you to hire employees in Brunei quickly without the delays and expense of setting up a local entity.

Full Legal Compliance

Experienced EORs ensure your hiring, payroll, and benefits practices align with Brunei’s labor laws, protecting your company from legal and financial risks.

Reduced Administrative Burden

The EOR handles employment contracts, tax filings, social security contributions (TAP and SCP), and other HR functions, freeing your team to focus on business growth.

Cost Savings

Compared to establishing your own branch or subsidiary, using an EOR dramatically lowers startup costs and ongoing compliance expenses.

  • Cons

Higher Per-Employee Costs

Monthly service fees can add up, making it slightly more expensive on a per-employee basis compared to managing staff through your own entity (if you already had one).

Less Direct Control Over HR Processes

Since the EOR is the official employer, some HR tasks or decisions require coordination with the EOR, adding an extra layer to employee management.

Data Sharing Considerations

Working with an EOR involves sharing sensitive employee and company information, so choosing a provider with strong data protection policies is essential.

For companies looking to expand into Brunei quickly, compliantly, and with minimal upfront investment, an EOR is often the smartest and safest solution.

Expand into Brunei with Confidence: Partner with Remote People

Partnering with a Brunei Employer of Record (EOR) offers businesses a fast, cost-effective way to expand without the need to establish a local entity. An experienced EOR handles the legal complexities, manages payroll and benefits administration, and ensures full compliance with Brunei’s labor laws, freeing your team to focus on growth.

When choosing an EOR, it’s vital to work with a provider that has a proven track record of guiding businesses through Brunei’s regulatory landscape efficiently and compliantly.

With Remote People as your EOR partner in Brunei, you gain a reliable solution for hiring, managing, and scaling your team—while we ensure full compliance with local labor laws.

That’s why Remote People offers direct EOR services in Brunei—giving you tailored support and compliant hiring solutions that align with your long-term growth goals.

Get in touch today to learn how our Brunei EOR solution can help you expand efficiently and cost-effectively.

Frequently Asked Questions

Upon choosing an EOR provider, employers should contact the provider to discuss their specific workforce and organizational needs and agree on an arrangement that can best support their long-term goals. Most EORs can be contacted via email or telephone, which can generally be found on their website.

The main difference between an EOR and a PEO (Professional Employer Organization) in Brunei is that a PEO acts as a co-employer, sharing the liability with the company, whilst an EOR assumes all liability. Often, however, the terms Brunei EOR and Brunei PEO are used interchangeably by providers. 

Yes, using an EOR is legal in Brunei. Companies are allowed to engage third-party HR providers to manage employment responsibilities such as payroll, benefits administration, and compliance with Brunei’s labor laws, including the Employment Order 2009.

Employees in Brunei are entitled to benefits such as paid annual leave, sick leave, maternity and paternity leave, contributions to the Employee Trust Fund (TAP) and Supplemental Contributory Pension (SCP), and workers’ compensation coverage. A qualified EOR ensures these benefits are properly administered.

Onboarding through a Brunei EOR typically takes between one to three weeks, depending on the complexity of the role and required documentation. This is significantly faster than setting up a local entity, which can take several months.