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Doing Business With Myanmar (Burma) PEO/EOR

Myanmar is a country in Southeast Asia officially known as the Republic of the Union of Myanmar and formerly known as Burma. With a population of 53,582,855, the country’s capital is Naypyidaw, and the largest city is Yangon (also known as Rangoon).

It is the largest country in Mainland Southeast Asia and the 10th largest in Asia by area. Myanmar is a country that shows consistent growth and development in several industries and is an economy rich in jade and gems, oil, natural gas, and other mineral resources. With a contribution from renewable energy to the country’s GDP, another sector that brings in a lot of revenues is the solar power sector compared to other countries of the Great Mekong Subregions.

When looking at the economic growth, a few industries that are making a mark in Myanmar’s GDP are Agriculture (with rice produce being the largest), extractive industries (Myanmar is known for precious stones that include rubies and sapphires, pearls, and jade), and tourism. 

With the large revenue contributions of the mentioned growing industries, the 2021 GDP estimate of Myanmar is $258 billion with a per capita of $1,422. As of 2020 statistics in the Human Development Index, Myanmar ranks 147 out of 189 countries in human development.

The largest cities or towns in Myanmar where many economic trades are conducted and recognized universities are located include Yangon, Mandalay, Naypyidaw, Bago, Hpa-An, and Taunggyi. 

The educational system in Myanmar is operated by the Ministry of Education, Government of Myanmar. A great ideology implemented with regards to education is that the education system in Myanmar is based on the UK’s system of education giving young students the necessary exposure during their early schooling years. With that, the adult literacy rate in Burma stands at 89.5%, indicating a contribution of the Burmese household towards education. However, English is taught as a second language with the primary language of education being Burmese. 

Major disciplines in Myanmar are Medicine, Science and Technology, Public policy, Economics, and Art. The established universities in Myanmar, if you are looking to hire graduates in Myanmar, are Yangon University, Yezin Agricultural University, Mandalay University, University of Medicine 1, Yangon University of Economics, and West Yangon Technological University. The list of top universities can be found here.

Suppose any business is looking at expanding their business in Myanmar. One key pointer to remember is that the country is known to be ethnically and linguistically diverse, which may cause a language barrier. The official language in Myanmar is Burmese, along with other recognized regional languages, including Kachin, Kayah, Karen, Chin, Mon, Rakhine, and Shan. Myanmar is known to have at least 108 different ethnolinguistic groups consisting mainly of distinct Tibeto-Burman people alongside sizeable Tai–Kadai, Hmong–Mien, and Austroasiatic (Mon–Khmer) peoples.

Although it is relatively easy to grow your business in Myanmar (Burma), considering a skilled and educated population pool in certain sectors, employers must be aware of the local tax compliances, benefits, and payroll aspects in Burma (Myanmar).

Here is where Burmese PEO or an Employer of Record can help. Multiplier’s PEO solution acts as your co-employers. We assume responsibility for all your HR operations in Myanmar (Burma) – onboarding, payroll, compliance management, employment contracts – while you focus on business matters in the country.

Why Use a Myanmar (Burma) PEO?

Employment is essential when looking to expand a business and hiring a remote team in Myanmar (Burma) would be a great idea; however, a few industries call for stringent work regulations for specific categories of employees. A major example of stringent policies established would be for laborers working for the manufacturing industry in Myanmar to protect the interests of the laborers and the industry generates a massive source of revenue in the GDP.

Myanmar’s economy is one of the fastest-growing economies in the world in 2017 according to the World Bank. The country also boasts of foreign investment that primarily comes from economies such as China, the Philippines, India, Thailand, South Korea, and Singapore.

With major industries such as Agriculture, Manufacturing Industry, Extractive Industries, and tourism being the largest revenue contributors to the Burmese GDP, these areas employ a large section of the middle-class population in Myanmar.

The government has been prioritizing creating policies that render economic reforms that would generate growth in employment, outputs, and incomes for their citizens. This ensures a promising future for finding much more skilled and educated talent for global businesses looking to hire talent from Myanmar.

​​With the economic policies on priority, Myanmar is looking at a few areas that would open the country to further global transactions that would prove to be an advantage to businesses looking to expand and hire in Myanmar. With changes such as opening the economy to foreign investments and international trade, a few import licenses have been eliminated. 

With time, Myanmar has ensured that the economy maintains macroeconomic stability by keeping a sound public financial structure by ensuring banks are prudently managed. This has made the financial systems in Myanmar intact for smoother transactions for businesses and employees. If you are an employer, you may want to read the research paper here for a better understanding of the economic development of the country.

Myanmar’s (Burma) labor codes and employment laws effectively protect employees/workers’ rights while preserving employers’ rights and legitimate interests of business expansion. Therefore, the employment law applies to all companies – national or foreign, and all the employees regardless of their citizenship.

Though understanding the labor laws are relatively straightforward, compliance is an area that requires assistance when looking for international talent in a developing country like Myanmar. 

Suppose you are starting your business or are looking to hire talent to expand your business. In that case, there is a need to understand all the details of policies, taxes, employment contracts, compliance, and matters related to the labor code.

Myanmar (Burma) PEO Costs

Usually, PEOs charge based on two pricing models – fixed and variable. A PEO based on the fixed pricing model charges a transparent fee ranging between $200 – $1000 per employee per month.

Multiplier is one such PEO solution. Our costs for Burma (Myanmar) start from $200 per employee per month. The final price depends on the complexity of employment laws of the employee’s jurisdiction.

Our prices ensure that you get the most out of your employee spending. Every employee hired through our PEO also receives HR support, benefits management, and a live dashboard to track workforce spending in real-time.

How to Hire in Myanmar (Burma)

Technology is a boon in today’s generation, especially during the post-covid-19 period – when the doors have opened to global employment opportunities for employees and employers across the globe. 

While entering Myanmar (Burma) to expand your business and your global team is reasonably straightforward, a gray area would be aspects like the country’s policies, the hiring process and where to hire from, the local labor law requirements, payroll, taxation, and compliance. 

Partnering with a Burmese PEO like Multiplier can help navigate these gray areas that require professional assistance. Multiplier is APAC’s #1 PEO and EOR, assisting global brands in gaining a competitive edge in the region. Book a demo to understand how Multiplier efficiently handles your global HR operations while you focus on the growth aspect of your business.

However, if you are looking at a DIY method, below are a few tips and tiny details you may want to keep in mind while expanding your business in Myanmar (Burma) and complying with local laws.

Myanmar (Burma) Employment Contracts

The Burmese employment contract is a written agreement between an employer and an employee. The employment contract must be issued by the employer to an employee within 30 days of employment. The employer must use the standard employment contract issued by the Government.

The employment contract in Myanmar will specify the type of employment, compensation, benefits, working hours, leave policies, probation period, termination and resignation guidelines, location of employment, roles/responsibilities/duties pertaining to the role, and overtime pay.

The contracts are usually made for an indefinite period unless specified. 

Working with global PEO and EOR partners such as Multiplier would ensure they undertake the responsibility of making employment contracts for your employees in Myanmar while being compliant.

Working hours

The maximum number of work hours that an employee must work before they are paid overtime depends on the industry they are employed in. The maximum work hours per week in an office setting is 44 with a maximum of 8 hours on a working day. 

Overtime work hours shall not exceed 12 hours per week.

Employees in Myanmar are entitled to overtime pay if work requirements exceed 8 hours on a workday. Employers are required to provide overtime pay at double the workers’ normal rate. The overtime pay also extends for any work done by employees on public holidays, Saturdays, and Sundays.

Official working hours in Myanmar for most companies are 8:30 am to 5:00 pm with a provision for 30 minutes of lunch/rest period.

Compensation

Permanent or full time employees in Myanmar must be paid monthly at the end of each payment cycle. Any company with over 100 employees is required to pay their employees within 5 days of the end of the payment cycle.

An employee in Myanmar typically on average earns 545,000 MMK per month and the salary/wages ranges between 138,000 MMK to 2,430,000 MMK depending on the industry (as per the 2021 survey). You can learn more about the salaries in Myanmar in detail on Salary Explorer if you are looking to hire talent in Myanmar with sector-specific compensation.

The national minimum wage in Myanmar is set for all employees regardless of age, experience, region, and industry. Paying an employee or a worker below the stipulated minimum wage shall be considered as a violation of law which would attract a penalty. 

Employment benefits in Myanmar (Burma)

Employment benefits are key if, as an employer, you are looking to retain your employees with your organization for an extended period. This also acts as an attractive feature to motivate employees in giving better outputs and give in better quality service while at work.

These may include benefits such as leaves, vacation policies, maternity leaves, sick leaves, healthcare insurance, and any additional benefits you may want to provide to appreciate the time and hard work.

You can now have all the benefits for your employees in just one click with the PEO and EOR platform – Multiplier.

Leaves and Vacation

The two most common forms of leave that employers must provide the employees with are Casual Leaves and Earned Leaves (also known as annual leave). 

Annual Leave

As per the Holidays Act, 1951, an employee shall be entitled to 10 working days as a part of earned leave after 12 months of continuous service with the same employer. 

  • Prior to completion of 12 months of service, the employee is not entitled to earned leave. 
  • Myanmar Law does not provide earned leave to new joiners.
  • Unused annual leave can be carried forward the next year of service with the same employer.
  • Any leave accrued if an employee resigns before one year of service, the accrued leave must be paid out at a rate that is equivalent to a daily average of the pay.

Service provided by an employee

Employer Status

Annual leave Entitlement

> 12 months

Same employer

No leave

< 12 months

Same employer

10 working days

Casual Leave

Employees are entitled to 6 days of paid casual leave in a contractual year. 

  • Casual leave entitlement extends to employees in their probationary period. 
  • Any unused casual leave is forfeited and resignation/termination of employees without a cause would not be entitled to any unused casual leave.

Public Holidays

On average, Myanmar has 25 days of Public holidays per year. Any employee required to work on a public holiday shall be paid overtime by the employer which shall be double the usual rate of pay. 

It is not mandatory for the employer to roll over the public holiday to the next working day if it falls on a weekend. Although it is at the discretion of the employer to do so.

All public holidays are recognized by Myanmar Law and the employees are entitled to take a public holiday as paid leave. However, the number and date of each public holiday are fixed by the Ministry of Home Affairs, Government of Myanmar.

Maternity Leave and Childcare Leave

Maternity Leave: Myanmar law does not state any distinction between married/single mothers or on the number of children born. 

All the female employees are entitled to 14 weeks (98 days) of paid maternity leave. The 9 weeks are divided into 6 weeks (42 days) before the birth of the child and 8 weeks (56 days) after the birth of the child and shall be provided for every pregnancy. The employee is entitled to an extra 4 weeks (28 days) if it is the birth of twins. 

In case of a miscarriage, the female employee is entitled to take up to 6 weeks (42 days) of paid leave.

Maternity Leave Breakup

Entitled Leave

Before childbirth

6 weeks (42 days)

After childbirth

8 weeks (56 days)

Total

14 weeks (98 days)

Multiple births (twins)

4 weeks (28 days)

Miscarriage

6 weeks (42 days)

To claim salary for the period of maternity leave, the employee will be required to file a claim with the Township Social Security office.

An employee is eligible for an adoption leave if a child is adopted who is below the age of 12 months. 

The maternity leave pay for employees covered under SSL is calculated as 70% of an employee’s average wage in a year. Employers must ensure additional benefits are provided to the female employees claiming maternity leave. 

Paternity Leave

All male employees are entitled to 15 days of paid paternity leave for the birth of a child. 

The salary for leave claimed is paid at 70% of the average salary of the previous years. However, paternity leave is only available for all male employees who have been working with the same employer for a minimum of 12 months with a contribution to the social security fund (minimum of 6 months within the same year).

Sick Leaves

An employee on their probation period shall not be entitled to any sick leave or any leave taken due to illness. 

Sick leaves shall be unpaid for the first six months of service with an employer. 

As per Myanmar Labor law, an employee is entitled to 30 days of paid sick leave per contractual year after the employee completes 6 months of continuous service with the same employer.

Service provided by an employee

Employer Status

Sick leave Entitlement

> 6 months

Same employer

Unpaid

< 6 months (12 months of  continuous service)

Same employer

30 days (1 month)

Insurance and Social Security

Insurance: Some employers and companies voluntarily provide private health insurance coverage. Since health insurance cover is a voluntary benefit provided by the employer, it is not regulated and shall be detailed within the internal company policy or documentation such as the employment contracts.

Social Security

All employers with more than 5 employees are required to comply with the Social Security Law, 2012. 

The benefits stipulated under the law for an employee include sickness, maternity, funeral, temporary disability, and permanent disability benefits. 

The contribution by an employee on a monthly basis is 5% of the employee’s monthly salary which is inclusive of allowances. The total maximum capping must be 15,000 Kyat per month (the US $11.50). This law is applicable to foreign employees.

Social security benefits do not include expenses relating to dependents of the employee.

Additional benefits

It is not mandatory for employers to provide their employees with additional benefits such as insurance and medical covers, pension/retirement schemes, employee stock options, transportation pay, etc. All the mentioned benefits are voluntary and must be communicated by the employers in writing. 

Probation period and Termination

The probation period and termination guidelines are important factors that must be clearly outlined between employer and employee through a written contract.

Termination

Termination of an employee during their probationary period must be with ‘sufficient grounds’ with one month’s advance notice in writing as per the Labor Act of Myanmar. 

The Myanmar law also reserves rights to the employer to dismiss the employee without notice and severance pay for any gross misconduct such as violation of employee handbook and employer’s code of conduct, sexual harassment within office premises, and/or leaking confidential data. The employer must give at least 3 prior warnings during the employee’s service with the employer.

If not subject to a probationary period, an employee must give to the employer in writing their resignation with a notice period of 30 days with the intent to terminate the contract, unless specified in the employment contract. 

The employer has an option of paying the salary of 30 days in lieu of the notice period. All the property issued by the employer to the employee must be returned back on the last day of employment.

Probation Period

For a standard contract, the statutory probationary period is 3 months as per the Labor Act and is not extendable by the employer in any circumstance.

During the probationary period, wages and salaries not less than 75% of the basic salary for the work performed must be paid to the employee/worker.

However, if an employee is looking to resign during the probationary period the employee must provide written notice of 7 days to the employer. This is required as per the Myanmar Labor Law.

A Burmese PEO like Multiplier can help you with an easy termination and also allows you to track the probation period of your new employees while being compliant with the economy.

Taxes in Myanmar (Burma)

Understanding that being compliant with employment law in Myanmar (Burma) can be challenging because the rules and being compliant are complex and subject to frequent change. 

Consequently, this may place a significant burden on admin and payroll staff when they have enough to deal with in helping a company’s Myanmar (Burma) operation be established. 

The process is why a global PEO managed services provider can be a tremendous asset in making sense of all the regulations and ensuring seamless compliance right from the start.

All the employers with employees in Myanmar are required to deduct and withhold Personal Income Tax. The taxes for each employee must be remitted to the tax authorities on a monthly basis. The employer must maintain an annual statement of the withheld Personal Income Taxes and should file the annual statement within 3 months from the end of the fiscal year.

Myanmar follows a progressive model of income tax.

The assessable income is demonstrated as below – 

Salary Range (in MMK)

Tax Rate (in %)

1 – 2,000,000

0

2,000,001 – 5,000,000

5%

5,000,001 – 10,000,000

10%

10,000,001 – 20,000,000

15%

20,000,001 – 30,000,000

20%

Above 30,000,000

25%

Why Multiplier

With Multiplier’s PEO/EOR solution, treading into a new market is as seamless as confidently ice-skating. 

We can help you onboard your preferred candidate, handle HR issues and payroll, and ensure compliance with local laws. By partnering with our EOR in Burma (Myanmar), you avoid the hassle of setting up a foreign branch or subsidiary.

Once you have chosen your desired talent, start generating and customizing employment contracts for them in a few clicks and manage the workforce from a single platform. You can also pay thousands of employees in Canadian Dollars with a single click. 

Hire and expand using the best SaaS-based PEO service in Myanmar (Burma). Contact us to grow your business today.

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