Definitive Guide to Hiring in Brunei

Hiring in Brunei

Hiring employees compliantly in Brunei means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Brunei so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Brunei or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Labor Laws in Brunei

Employment laws in Brunei are uniquely suited to the country’s way of life, and crucial to understand if you want to employ local talent in this country. Get the details on Brunei employment laws and Brunei policies here.

Employee Probation Period

• The qualifying period is the same as the employee's probation period, which may not exceed 90 consecutive days.

Annual Leave in Brunei

• Once they have worked for a company for a full year, Brunei employees receive 12 paid days of annual leave.
• Two extra leave days are added after five years of service.

Holidays in Brunei

Here is the full list of public holidays in Brunei:

Maternity Leave Brunei

• The total duration of maternity is 9 weeks, which shall be taken 4 weeks immediately preceding her confinement and 5 weeks immediately after confinement.
  
  

Paternity Leave Brunei

• There is no statutory paternity leave

Sick Leave in Brunei

• An employee is entitled to 14 days outpatient sick leave per year and 60 days hospitalization leave (including the 14 days outpatient sick leave)

Working Hours in Brunei

• An employee shall not be required to work more than 8 hours in one day.
• An employee shall not be required to work more than 44 hours in one week.

Overtime in Brunei

• An employee shall not be permitted to work overtime for more than 72 hours a month.
• An employee shall not be permitted to work for more than 12 hours in any day.
• For the purpose of calculating the payment due for overtime to an employee, his hourly basic rate of salary shall be calculated in accordance with the following formula:
  • in the case of a person employed on a monthly rate pay, 12 x the employee’s monthly basic rate of salary divided by 52 x44 hours.
  • in the case of a person employed on pieces’ rates, the total weekly salary at the basic rate of salary received divided by the total number of hours worked in the week.

Termination of Employment in Brunei

• A termination of contract may occur when:
  • The work specified in the contract has been completed or when a date specified in the contract for the expiry of the contract has been reached.
  • Either party has decided to end the contract with appropriate notice in accordance with terms of the contract.
  • There has been a breach of contract and the other party wishes to terminate the contract.
• The notice period for termination of contract depends on what is agreed in the contract.
• The length of notice period must be the same for both parties.
• If there is no notice period agreed by either party or included in the contract, the following notice period shall apply: -
  • If length of employment is less than 26 weeks, 1-day notice period
  • If length of employment is between 26 weeks and 2 years, 1 week notice period
  • If length of employment is between 2 and 5 years, then 2 weeks’ notice period
  • If length of employment is of 5 years or more, then 4 weeks’ notice period

Notice Period in Brunei

• The notice period for termination of contract depends on what is agreed in the contract.
• The length of notice period must be the same for both parties.
• If there is no notice period agreed by either party or included in the contract, the following notice period shall apply: -
  • If length of employment is less than 26 weeks, 1-day notice period
  • If length of employment is between 26 weeks and 2 years, 1 week notice period
  • If length of employment is between 2 and 5 years, then 2 weeks’ notice period
  • If length of employment is of 5 years or more, then 4 weeks’ notice period

Severance in Brunei

• The total salary due to an employee must be paid on his last day of employment if: -
• He is dismissed on the grounds of misconduct
• His service is terminated by his employer If this is not possible, it must be paid within 3 working days from the date of dismissal or termination.

Brunei Salary and Wages

13 / 14th Month Salary in Brunei

• No
• There is no statutory requirement to pay the 13th or 14th month salary.
• Interestingly the labour code has put a cap on the bonuses that employees are entitled to pay.
• This is capped at one and a half time the employee's salary, any overpayment will be an offence.
• Remuneration other than wages are allowed, however those cannot be in alcoholic form.

• Brunei Darussalam does not impose social security taxes.
• However, under the government-run Tabung Amanah Pekerja (TAP) and Supplementary Contributory Pension (SCP) employee trust fund schemes, employees who are Bruneian citizens or permanent residents and their employers are required to contribute to the funds for the benefit of the employees.
• Under the TAP scheme, employees must contribute at least of 5% of their basic salaries to the fund and employers must make a contribution at a minimum rate of 5% for their employees.
• Under the SCP scheme, the employees’ and employers’ contributions are calculated at a rate of 3.5% of basic salaries of the employees.
• These contributions are each subject to a maximum contribution of BND98 per month per employee.
• The employers withhold the employees’ contributions.
• These contributions and the employers’ contributions are payable monthly by the employers to the funds.
• These schemes do not apply to foreign nationals who are not permanent residents.

Immigration Brunei

• Employers in Brunei Darussalam who wish to hire foreign workers are allocated quotas that permit them to employ foreign nationals.
• An applicant is advised to verify with his or her potential employer that an appropriate quota is available and is suitable for the employment position and nationality of the applicant.
• To work in Brunei Darussalam, foreign nationals must obtain employment visas, which are usually granted for an initial period of up to two years, and subsequently extended for two-year periods, if certain requirements are met.
• The following are the procedures to obtain an employment visa in Brunei Darussalam:
  • The employer must apply to the Department of Labor for a foreign workers’ license by submitting an application through an approved employment agency. The application must state the employment position and nationality of the prospective employee. It takes about 14 working days or less for a foreign workers’ license to be issued.
  • The employer must then enter into an employment contract with the employee, which must be filed with the Department of Labor. The employee may also be required to attend an interview.
  • The employer must submit copies of the foreign workers’ license, employment contract and employee’s passport to the Department of Immigration, together with a security deposit to cover the employee’s repatriation expenses. It usually requires one to two weeks for an employment visa to be issued.
  • An employment visa is initially granted on a temporary basis, usually for three months, during which the employee must undergo medical tests. The employee must also obtain an identity card, normally renewable every two years, which is issued by the Department of Immigration.
  • On expiration of the initial temporary visa, if the results of the medical tests are satisfactory, an employment visa valid for a two-year period is normally granted.

Value Added Tax (VAT) in Brunei

• Brunei does not have a VAT or sales tax

Mandatory Benefits in Brunei

• These are mandatory benefits as postulated by law
• These include probationary period, annual leave, public holidays, sick leave, maternity leave, overtime pay, notice period, 13th month pay and severance pay
• Mandatory benefits also include social security benefits.

Payroll Accrual in Brunei

Country Accruals Additional Information

Description

The prescribed contribution rate at the moment is 8.5% (wages of employee) and (8.5%) from the employer.

Payroll Accruals Additional Information

Accrued Benefits in Brunei

Why use Global Expansion to hire in Brunei

Establishing a branch office or subsidiary in Brunei can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Brunei labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Brunei law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Brunei. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Brunei Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.