Build a global team in minutes
Get expert helpLaos doesn’t usually top the list when companies start thinking about global expansion. But that’s beginning to change. Its location in Southeast Asia, growing workforce, and lower operating costs make it worth a closer look—especially if you’re trying to stretch your hiring budget without sacrificing quality.
The tricky part comes into play when you try to figure out the process of hiring and paying someone there. Laos has its own labor laws, payroll rules, and compliance requirements that don’t line up with what you’re used to. And getting it wrong can cost you more than the savings you expect.
What follows is a practical breakdown of hiring in Laos—how to do it legally, set up payroll correctly, and sidestep the mistakes that catch most first-timers off guard.
Understand key labor laws and hiring foundations
You’ve found the talent. Now it’s time to make sure you’re following the rules. Here’s what you need to know about how hiring works in Laos.
Labor law basics for employers
Employment in Laos is governed by the 2013 Labor Law, updated in 2018. It covers everything from contracts to working hours to termination. Enforcement comes down to two main bodies: the Ministry of Labour and Social Welfare (MoLSW) and the National Social Security Fund (NSSF).
To legally hire in Laos, you’ll need to:
- Register your business with the Ministry of Industry and Commerce
- Sign a written employment contract in Lao
- Enroll your employee in the national social security system
What kind of contract?
You’ve got two options:
- Fixed-term contracts (with clear start and end dates)
- Indefinite-term contracts (open-ended employment)
Most employers use a 30 to 60-day probation period. Just make sure all contracts are written in Lao and include things like job duties, pay, benefits, and how termination works.
Wages, hours, and leave—here’s what’s required
As of December 2025, the minimum wage in Laos is LAK 2,500,000 per month (around US$114). That’s the baseline, but many companies pay more depending on the role.
The workweek is 48 hours, spread across six days. Overtime kicks in after that, with extra pay depending on when and how it’s worked.
Here’s what else you’re expected to provide:
- Annual leave. 15 paid days
- Public holidays. 11 per year
- Sick leave. Up to 30 days (with a doctor’s note)
- Maternity leave. 105 days, with at least 60 post-birth
Practical steps for hiring employees in Laos
Where to find candidates
For local hires, start with the popular job board that most employers in Laos use: 108.jobs. Facebook groups and local agencies can work too, especially in Vientiane. For more specialized roles, LinkedIn or regional headhunters may help.
Onboarding without missing anything
Once you’ve made the offer:
- Draft and sign the employment contract in Lao
- Register the hire with the MoLSW
- Enroll the employee in the NSSF
- Apply for a work permit if they’re not Lao
- Collect documents: ID, tax number, emergency contact, banking info
Plan on 2–3 weeks for full onboarding.
Payroll setup, payment, and compliance
This is where things often go sideways because payroll in Laos has its own set of rules. Getting it wrong means fines or even invalidated contracts. Here’s how to get it right from the start.
What payroll includes
Here’s what most payroll breakdowns in Laos look like:
- Gross salary (paid in Lao Kip)
- Allowances (often for transport, meals, or housing)
- Deductions (social security, income tax, and any approved absences)
You’ll need to set up a calendar to handle monthly tax submissions and payments to the NSSF. Most employers pay on the last workday of the month.
Paying people the right way
Payroll has to be issued in Lao Kip. Bank transfers are the norm, and you’ll need a local business account to run payroll properly. Even if your HQ is elsewhere, Lao law doesn’t allow you to pay in foreign currency.
If you’re managing payroll from another country, work with an EOR provider like Pebl that understands multi-currency payroll rules and local banking compliance.
Tax and social contributions
Your responsibilities as an employer:
- Withhold Personal Income Tax (PIT) (rates vary by income)
- Contribute to Social Security (6% from you, 5.5% from your employee)
All of this gets reported monthly to the tax office and NSSF. If you miss a deadline, expect fines or audit issues.
Cost structures and common payroll pitfalls
Real costs, not just salary
Here’s what a monthly cost might look like for a mid-level hire:
- Base salary. LAK 4,000,000
- Employer social contribution. LAK 240,000
- Common allowances. ~LAK 400,000
- Total cost. LAK 4,640,000 (~US$225)
Exchange rates move, so use tools like Xe when planning.
What trips up most employers
- Contracts not written in Lao
- Employees paid in USD or another currency
- Missing the 30-day registration window with MoLSW
- Misclassifying full-timers as contractors
These aren’t small mistakes—they can lead to invalid contracts, denied visas, and tax penalties.
Tips and resources for successful applications and partnering with EOR providers
Hiring in Laos doesn’t have to mean building an HR department from scratch. Here’s how to make it smoother.
Visa and permit tips
Foreign employees need a work visa and permit. You’ll sponsor both. Start early—processing takes time and requires clean paperwork.
Helpful resources
- Official job boards like 108.jobs
- NSSF and tax guidance from local service providers
- Understand the difference between a work permit and a work visa
- Understand what labor law entails
What is an Employer of Record (EOR)?
An Employer of Record (EOR) hires your team in Laos for you—legally. You still manage the work, but the EOR handles contracts, benefits, payroll, taxes, and compliance. It’s a great fit if you’re:
- Hiring in Laos without an entity
- Testing a new market
- Short on internal HR or legal support
With an EOR, you skip the paperwork but still stay compliant. They manage the labor law side while you grow your team.
Your options for hiring in Laos: Employer of record or local entity setup
Option 1: Use an EOR
Fast, flexible, and ideal if you’re hiring one or two people to start. EORs let you:
- Onboard quickly without a Lao legal entity
- Handle payroll, benefits, and compliance through one provider
- Avoid visa delays or contract errors
Option 2: Set up your own entity
If you’re planning to scale a full team in Laos long term, forming a local company makes sense. You can choose:
- Representative office (non-commercial)
- Branch of your existing company
- Subsidiary registered in Laos
Setup takes about 2–3 months and comes with capital requirements and ongoing admin.
Start mapping your hiring and payroll plan in Laos
The opportunities in Laos are real, but so are the rules. With clear contracts, smart payroll systems, and a plan for compliance, you’ll be ahead of the curve.
Whether you hire directly or use an EOR, the key is knowing what’s required and not getting stuck in guesswork. This guide gives you the tools to make a confident first hire.
How Pebl helps simplify hiring and payroll in Laos
At Pebl, we make it simple to hire and pay employees in Laos and 185+ countries without setting up a local entity. Our EOR services handle contracts, benefits, payroll, and compliance, so your team is covered from day one.
We’re here to help you:
- Hire fast with no legal gaps
- Stay compliant with Lao labor law and payroll
- Scale flexibly with a partner who knows the local rules
Ready to make your first hire in Laos? Let’s talk.
This information does not, and is not intended to, constitute legal or tax advice and is for general informational purposes only. The intent of this document is solely to provide general and preliminary information for private use. Do not rely on it as an alternative to legal, financial, taxation, or accountancy advice from an appropriately qualified professional. The content in this guide is provided “as is,” and no representations are made that the content is error-free.
© 2025 Pebl, LLC. All rights reserved.
