Key Takeaways

  1. Hiring in Myanmar requires careful compliance with multiple labor laws, including the 2013 Employment and Skill Development Law, the Social Security Act, and various tax regulations.
  2. Companies can hire via a local entity, an Employer of Record (EOR), or independent contractors—each with unique legal and administrative obligations.
  3. Successful recruitment in Myanmar involves localization, including Burmese-language job ads, knowledge of local job boards, and culturally sensitive interviews.
  4. Understanding Myanmar’s employment landscape—including wages, benefits, termination laws, and contract requirements—is essential for building a compliant and sustainable workforce.

Formerly known as Burma, Myanmar is the largest country by land mass in mainland Southeast Asia. It has a population of about 55 million people and is bordered by major centers of global trade, like India and China, as well as smaller countries such as Bangladesh, Laos, and Thailand. The capital city of Myanmar is Naypyidaw, but its largest metropolis is Yangon (formerly known as Rangoon).

In its history, Myanmar has been colonized by a few different nations, including India and Japan. It officially declared independence in 1948, although its post-independence era has been marred by ongoing political conflict and violence. Despite the political situation in Myanmar, the country offers a rewarding environment for foreign investment and trade.

The country is rich in natural resources, including oil and natural gas, and offers preferential treatment to foreign businesses under its 2016 Investment Law. Myanmar is also the home of thousands of ancient Buddhist temples and is considered one of the great archaeological treasures of Southeast Asia.

Why Expand Your Business to Myanmar

Myanmar is a favorable destination for doing business due to its investment-friendly policies and many corporate tax exemptions. The country has attracted further foreign interest due to its low labor costs. The minimum hourly wage in Myanmar is just 600 Burmese Kyats, which is equivalent to 0.28 American dollars.

In other words, paying a Burmese citizen for an 8-hour day costs just $2.24 in U.S. dollars. In addition to its attractive labor costs, Myanmar boasts a promising economy driven by its natural resources. Myanmar’s GDP reached USD 67.55 billion in 2024 after hitting lows after the pandemic.

In the post-COVID days, its economy has been growing steadily year over year. In addition to its many valuable exports, which also include precious gems, Myanmar is a member of AFTA (the ASEAN Free Trade Area). This membership provides reductions on specific duties and exemptions for qualifying foreign investors.

Importance of Being Aware of Burmese Labor Laws

The general consensus regarding labor laws in Myanmar is that they are outdated, inconsistent, and under-enforced. However, Myanmar is a member state of the International Labour Organization (ILO) and is therefore bound to the requirements of the 1998 Declaration on Fundamental Principles and Rights at Work. These requirements mean that Burmese citizens.

  • Have freedom of association and the right to bargain collectively
  • May not be forced into compulsory labour
  • May not be forced into child or underage labor
  • And may not be discriminated against in employment and occupation.

In addition to the overarching requirements put in place by the ILO, there are also labor codes in Myanmar, such as the Employment and Skill Development Law of 2013 (ESD Law). The ESD Law provides a list of specific terms that must be included in every employment contract and also regulates items like severance pay, notice periods, and leave entitlements. 

Being aware of these legal requirements is essential for anyone hoping to avoid potential legal problems and build a positive reputation as an employer in Myanmar. If you are worried about compliance, working with an Employer of Record in Myanmar can help ensure you are fulfilling all of your responsibilities as an employer.

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Step 1: Define Your Hiring Needs

Before beginning the hiring process in Myanmar, it is crucial to think about your company’s long-term objectives in the country. Are you hoping to initiate a large-scale hiring process or simply establish a smaller team to manage local operations? Once you know the bigger picture of your hiring motives, you can better determine what positions you need to fill. 

Once you have determined which roles you are hiring for, think about what kind of person you want to fill each role. What skills or experiences do these roles require? Are there specific qualifications and experience that are necessary for each position, such as language proficiencies or higher education degrees? How many employees do you need to hire? Answering these questions in advance will make the recruiting process in Myanmar more efficient and more effective.

Step 2: Familiarize Yourself With Compliance

Understanding the labor laws, tax obligations, and mandatory benefits offered in Myanmar is essential. Myanmar has its own labor laws, including the pertinent Employment and Skill Development (ESD) Law of 2013, but also falls under the jurisdiction of International Labour Organization (ILO) requirements, which set forth a baseline level of compliance. 

It’s also important to understand the tax laws in Myanmar. Personal income taxes in Myanmar follow a progressive structure with rates ranging from 1% to 25%. Anyone making less than 4.8 million Myanmar Kyats (equivalent to USD 2,285.71) is exempt from paying income tax.

For corporations in Myanmar, tax rates range from 17% to 25%. Employers in Myanmar are responsible for withholding personal income tax from employees’ salaries when paid out and remitting it to the country’s tax authorities.

Step 3: Choose Your Hiring Method

The next step in hiring employees in Myanmar involves deciding on the best hiring method for your needs. Will you establish a legal entity in Myanmar, use an Employer of Record (EOR), or hire independent contractors? Each option comes with pros and cons.

Establishing a Legal Entity

According to Myanmar’s Special Companies Act as well as the Myanmar Companies Law, you must register your company before incorporating it in the country. This law applies to Myanmar nationals as well as foreigners.

To register your company in Myanmar, you need a unique name. You can check if your name is available at the Directorate of Investment and Company Administration (DICA). Then, you can complete the registration forms and pay the requested fee online.

Once your company is registered, which can involve a waiting period while your forms and fee are processed, you can kick off incorporating a subsidiary or branch.

Using an Employer of Record (EOR)

Using an Employer of Record in Myanmar can simplify the hiring process and help you reduce administrative and onboarding costs. An employer of record acts as the legal employer for your workforce, handling payroll, tax compliance, employment contracts, and administration of benefits.

Using an EOR ensures full compliance with Burmese labor laws while you focus on what is most important: your business operations. When you work with an EOR, you can get up and running in Myanmar much faster, and you will avoid the paperwork and mundane tasks related to registering a subsidiary or branch of your company in Myanmar.

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Hiring Independent Contractors

Hiring independent contractors in Myanmar might seem like an attractive option, but it can be challenging due to the country’s stringent rules and high misclassification penalties.

Should you misclassify employees as independent contractors in Myanmar, you may be subject to fines, back payments of social security contributions, and legal consequences.

Employers are obligated to comply with the Social Security Law and the Employment and Skills Development Law, and non-compliance can lead to enforcement action by labor authorities, including license revocation or penalties.

Step 4: Develop a Recruitment Strategy

The next question to ask yourself is, how am I going to find the right talent for this job? To begin with, you need to write an effective job description that is aligned with local market expectations. While there are hundreds of local languages spoken in Myanmar, Burmese is the official language and the most popular option for business purposes.

English is typically seen as the de facto second language and is also spoken widely. You’ll also want to make sure the job description aligns with local anti-discrimination codes and other labor laws.  

Additionally, it is important to consider where you are posting your job. Many Americans and Europeans are familiar with global job sites like LinkedIn and Indeed, but there are also some niche platforms that serve Myanmar and Southeast Asia specifically. In addition to Indeed, Burmese job seekers often use Jobs.com.mm, BestJob Myanmar, and JobsInYangon.com.

Step 5: Conduct Interviews and Assessments

Once you have identified some potential candidates for your position, you’ll want to conduct interviews that adhere to cultural norms. Buddhism is an important part of Burmese culture, and it is related to customs of modesty, respect, and deference to authority.

In Myanmar, it is considered polite to be calm and avoid showing emotion in public. When you exchange business cards in Myanmar, you should do so using both hands and a smile. Indirect and discreet communication is prioritized above directness, and laughter is a good way to break up awkward conversations.

Additionally, do not point at people with your feet – this is considered disrespectful in Myanmar. You will want to make sure that you structure interviews appropriately and assess candidates fairly while keeping Myanmar’s traditions and customs in mind. Additionally, including written or practical assessments can help you better evaluate a candidate’s readiness to hit the ground running in their new position.

Step 6: Perform Background Checks

Conducting background checks before you officially hire an employee is widely accepted as a way to ensure that the person is who they say they are – and that they truly possess the qualifications and abilities needed to perform your job.

While some countries have strict rules and regulations about data collection and background checks, Myanmar has no such rules. As such, it is customary to confirm candidates’ employment history, check in with references, and obtain criminal history reports before hiring someone in Myanmar.

Step 7: Draft Employment Contracts

The Employment and Skill Development (ESD) Law of 2013 provides a clear list of all the necessary elements that should be included in an employment contract in Myanmar. This list includes.

  • Names of both parties and their contact information
  • Nature of the job and duties to be performed, including working hours, overtime rules, 
  • Remuneration, or the wage/salary to be paid 
  • Place of work and any relevant travel accommodations
  • Date of commencement and term, if applicable
  • Other terms and conditions, such as leave entitlements, probation periods, notice periods, and more

Myanmar’s Ministry of Labour requires that employment contracts be submitted in a bilingual format with copies in both Burmese and English. The contract also must be signed in front of a witness and signed in the country of Myanmar. For employers who opt out of using an Employer of Record, this can be a significant hurdle.

Step 8: Register with Authorities and Set Up Payroll

Before any of your employees begin work, it’s important to complete a few registration steps with Myanmar’s authorities. You already incorporated your company in Myanmar or chose another way to hire in Step 3, but now you need to ensure you are set up properly to pay your employees, withhold taxes, and remit social security and tax payments appropriately.

Here are some of the steps you should take at this stage.

  • Register your company with the Internal Revenue Department (IRD)
  • Set up corporate tax payments to the IRD
  • Set up personal income tax withholding from employees, which will also go to the IRD. You will need to ensure each employee has a Burmese tax identification number. If they do not, they may need an additional work visa. 
  • Register your company with the Social Security Board in order to withhold social security payments from employees and pay your required contributions.

Step 9: Onboard Your New Employees

Onboarding your new employees effectively will help them smoothly integrate into your company’s unique culture. Forbes reports that a strong onboarding strategy will increase employee engagement and retention rates, which will in turn impact customer satisfaction. With that in mind, it’s crucial to design an onboarding process that includes the following.

  • Provide the necessary training and resources
  • Introduce the new team member to peers and key stakeholders
  • Explain company policies, procedures, and expectations
  • Immerse the new hire in the company culture and discuss company values
  • Set clear objectives and goals for the new hire’s role

Understanding the Myanmar Employment Landscape

Hiring in Myanmar requires a clear understanding of local employment practices. While the labor environment continues to evolve, companies that align with local norms and regulations are better positioned to attract talent and maintain compliance.

Myanmar’s Labor Code

Unlike many countries, Myanmar’s labor laws are distributed among various pieces of legislation. The Social Security Act of 2012 is distinct from the Employment and Skill Development (ESD) Law of 2013, which is also separate from the 1951 act outlining holidays and leave entitlements. That means that it can be challenging to stay abreast of labor law requirements in Myanmar.

Additionally, the country has a reputation for inconsistent enforcement of these laws – but while it can feel easy to get comfortable with noncompliance, penalties (both legal and financial) can be high. In short, it is important to explore and understand all of the many facets of Myanmar’s labor laws.

Social Security Regulations

The pertinent legislation as it relates to Social Security is the Social Security Act of 2012. This act outlines a Social Security scheme that is split between the employee (who contributes 2% of their monthly salary) and the employer (who contributes 3%).

Participating in the country’s Social Security scheme is required. Social Security must be paid in Myanmar Kyats (MMK). It is also important to note that benefits such as medical cover and pension/retirement schemes are not mandatory in Myanmar.

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Types of Employment Contracts

Understanding the different types of employment contracts in Myanmar is important when hiring in the country. Both types of contracts can be either collective agreements or individual employment contracts. Collective agreements are negotiated between employers and labor organizations or trade unions and cover the terms and conditions of employment for a group of employees.

Individual contracts are negotiated specifically between one employee and their employer. In both cases, the terms of the contract can be more favorable to the employee than what the law requires, but they cannot be less favorable. 

Permanent Employment Contracts

The most common type of employment contract in Myanmar, permanent contracts do not have a set end date. A probationary period or “apprenticeship period” of up to three months can be added to the beginning of this contract, during which either party can terminate the contract without notice or severance pay. 

Fixed-Term Employment Contracts

The law in Myanmar does allow for fixed-term contracts, but some areas of the country may limit them to a maximum of two years. Extensions to fixed-term employment contracts in Myanmar require approval from a local government office. These contracts are often used for seasonal or temporary work, such as covering for an employee who is on maternity leave.

Working Hours and Overtime

The standard working hours in Myanmar are 8 hours per day and 48 hours per week. This typically equates to a six-day workweek, and employees are guaranteed one day of rest each week, normally taken on Sunday. 

If employees work more than 8 hours per day or 48 hours per week, they are entitled to overtime pay at 200% of their regular prorated hourly wage.

Leave Policies

Myanmar’s labor laws provide rules and regulations surrounding yearly leave for employees and other employee benefits. This includes paid annual leave as well as other leave reasons such as medical leave, parental leave, and bereavement leave.

Leave TypeEntitlement
Annual LeaveEmployees are awarded six days of paid leave each year, regardless of a probationary period. Once an employee has been in service with the same company for more than one year, the leave allotment increases to 10 days of paid leave.
Medical LeaveOnce an employee has been with the same company for more than six months, they are entitled to 30 days of paid medical leave each year. 
Maternity Leave and Paternity LeavePaid maternity leave is given to expectant mothers starting six weeks before the child’s due date and eight weeks after. Once the child is born, fathers are given 15 days of paid maternity leave.

Termination Rules

To lawfully dismiss an employee, the employer must either provide one month’s written notice or be able to prove gross misconduct. In the case of gross misconduct, notice for termination is not a requirement by the state. 

According to Myanmar’s Ministry of Labor, employees are entitled to severance pay unless gross misconduct was the reason for their termination. The amount of severance pay depends on how long the employee was working for the company: 

  • 6-12 months: 0.5 months of pay
  • 1-2 years: 1 month of pay
  • 2-3 years: 1.5 months of pay
  • 3-4 years: 3 months of pay
  • 4-6 years: 4 months of pay
  • 6-8 years: 5 months of pay
  • 8-10 years: 6 months of pay
  • 10-20 years: 8 months of pay
  • 20-25 years: 10 months of pay
  • 25+ years: 13 months of pay

Optional Benefits

In addition to the many compulsory benefits required by labor laws in Myanmar, optional benefits can be leveraged to attract and retain top talent. Bonuses are not legally required in Myanmar, but they are a common perk. Other optional benefits to consider include…

  • Mental health services and/or a mental health stipend
  • Additional days of paid leave or vacation time
  • Private health insurance
  • Family bonuses or childcare subsidies
  • Performance-related incentives

While not technically required in Myanmar, it is common to give employees a bonus equivalent to one month’s salary. This typically occurs during the Thingyan Water Festival, equivalent to the Myanmar New Year, in April.

How to Hire Employees in Myanmar – Our Take

When you are hiring employees in Myanmar – or any foreign country, for that matter – you will have to work with a complex set of legal requirements, including labor laws, mandatory contributions, and employee protections set in stone by civic codes.

Being familiar with these regulations and ensuring you are complying with the country’s legal considerations is crucial for avoiding lawsuits and building a positive reputation in Myanmar.

If juggling these requirements on your own sounds daunting, working with an Employer of Record (EOR) in Myanmar can simplify the process, saving you time, money, and effort.