Hiring foreigners in Nepal involves navigating a complex web of labor and immigration regulations designed to prioritize local employment. This guide offers a clear, step-by-step explanation of the process, legal requirements, and practical tips for hiring foreign workers (work permit in Nepal).
Reasons for Hiring Foreign Workers
Nepal’s businesses may need foreign professionals for various reasons:
Unique Expertise: Fields like software development, engineering, or clean energy often require specialized skills not yet widespread in the local market.
Global Project Experience: Major infrastructure or donor-backed initiatives frequently rely on foreign consultants or managers with international track records.
Skill Development: Multinational firms and NGOs hire foreigners to mentor and train Nepali staff, building long-term expertise.
Regulatory Alignment: Companies with foreign investment may bring in specialists to ensure compliance with global standards.
Strategic Leadership: Startups or ventures funded by international capital often appoint foreign executives with worldwide business insight.
International Growth: Firms expanding abroad may need staff with foreign language skills or regional market knowledge.
Despite these demands, Nepal’s laws require employers to prioritize local hires and justify the need for foreign workers.
Legal Requirements for Hiring Foreign Workers
Hiring foreign workers in Nepal is governed by a framework of laws and policies:
Labor Act, 2017 (Section 22)
- Foreign workers can only be hired if no qualified Nepali candidate is available.
- Employers must obtain a work permit from the Department of Labour and Occupational Safety.
- Job vacancies must be advertised locally to demonstrate the absence of suitable Nepali applicants.
- Exceptions may apply for specialists hired under government-approved investment deals, bypassing the advertising requirement.
Detail the process for applying for work permits, required documents, renewal procedures, and conditions for permit revocation.
Immigration Act, 1992 and Rules
- Foreigner needs to apply for Working Visa at the Department of Immigration after a work permit is secured.
Foreign Employment Directive, 2075
- Outlines eligibility, application steps, fees, and restrictions to ensure foreign hiring aligns with Nepal’s labor market goals.
Foreign Investment and Technology Transfer Act, 2019 (Section 27)
- Allows foreign workers in foreign-invested businesses if no qualified Nepali is available and the role supports skill transfer.Such hires must be reported to the Department of Industry (DoI).
Industry-Specific Regulations
- Sectors like finance, telecommunications, or insurance may have additional conditions for foreign employment.
Responsible Authorities
Key government bodies involved include:
- Department of Immigration: Grants work concurrence and Non-Tourist Work Visas.
- Department of Labour and Occupational Safety: Issues work permits.
- Department of Industry: Provides recommendations for permits and visas.
Exemptions from Work Permits
Certain categories are exempt from work permit requirements under Section 23(2) of the Labor Act:
- Diplomats with immunity.
- Individuals covered by international treaties with Nepal.
- Technicians hired for short-term tasks (e.g., equipment maintenance) for less than three months.
How to Hire Foreign Workers: Step-by-Step
Step 1: Post a Job Advertisement
- Announce the vacancy in a national newspaper and the DOLOS online job platform, including:
- Job title and number of openings.
- Required qualifications and experience.
- Application process and deadline.
- Role duties and expectations.
Step 2: Request DOI Recommendation
If no qualified Nepali applicants are found, apply to the DoI for a work permit and work concurrence recommendation. Submit:
- Formal application letter.
- Copy of the newspaper advertisement.
- Candidate’s resume, academic certificates, and passport (valid for at least six months).
- Signed employment contract.
- Company board resolution approving the hire.
- Business registration documents (e.g., MOA, AOA, PAN, industry registration).
- Latest tax clearance certificate.
- Plan to train Nepali staff to eventually replace the foreign worker.
- Power of attorney and foreign investment approval (if relevant).
Step 3: Secure Work Concurrence
Submit the DOI recommendation and supporting documents to the Department of Immigration to obtain work concurrence.
Step 4: Apply for a Work Permit
File an application with DOLOS using the designated form (Annex 1, Labor Rules, 2075), including:
- Original newspaper ad and DOLOS portal confirmation.
- Notarized passport copy, resume, and passport-size photo.
- Employment contract (signed and notarized).
- DOI recommendation and Immigration work concurrence.
- Explanation of why no local candidates were selected.
- Training plan, PAN certificate, tax clearance, and Social Security Fund (SSF) registration.
- Relevant ministry approval (if required).
Fees:
- NPR 15,000 for up to 6 months.
- NPR 20,000 for over 6 months.
- Overseas applicants pay in convertible foreign currency.
Processing Time: Around 7 working days.
Step 5: Request Work Visa Recommendation
After obtaining the work permit, apply to the DOI for a Work Visa recommendation.
Step 6: Apply for Working Visa
Submit to the Department of Immigration:
- Online visa application.
- DOI recommendation and work concurrence.
- DOLOS work permit.
- Employment contract.
- Company’s recent tax clearance certificate.
- Applicant’s tax certificate (for renewals).
- Passport and existing visa copy (if already in Nepal).
Permit and Visa Validity
- Initial Validity: One year, renewable annually.
- Maximum Duration: Five years for highly skilled workers; three years for others.
- Renewals must be requested before expiry to avoid legal issues.
Process Overview
- Assess staffing needs.
- Advertise for local candidates.
- Document the need for a foreign hire.
- Obtain DOI recommendation and Immigration work concurrence.
- Secure a DOLOS work permit.
- Apply for a Work Visa.
- Onboard the employee and comply with labor/tax regulations.
- Renew permits and visas as needed.
Consequences of Non-Compliance
Hiring foreign workers without proper authorization can lead to:
- Fines up to NPR 200,000, plus NPR 5,000 per worker per month for continued violations.
- Visa cancellation and deportation of the worker.
- Legal penalties or employer blacklisting.
- Increased scrutiny in regulated industries.
Special Cases
- NGOs and Donor Projects: May require coordination with the Social Welfare Council or other bodies.
- Foreign Investors/Entrepreneurs: Must secure Business or Investor Visas via the Investment Board Nepal or DOI, but work permits are still needed for foreign employees.
FAQs
Can foreigners work legally in Nepal?
- Yes, with a DOLOS work permit and a Non-Tourist Work Visa
What steps are needed to hire a foreign worker?
- Advertise locally, justify the hire, secure DoI and Immigration approvals, obtain a work permit, and apply for a Work Visa.
Who is exempt from work permits?
- Diplomats, treaty-covered individuals, short-term technicians (under 3 months), and certain investment-related hires.
How many foreign workers can a company employ?
- Up to 5% of the workforce, or three for foreign-invested firms, unless otherwise approved.
What documents are required for a work permit?
- Ad proof, justification letter, candidate’s resume and passport, contract, tax clearance, training plan, and SSF registration.
How long does a work permit take to process?
- Typically 30–45 working days, depending on the application.
How long is a work permit valid?
- One year, renewable up to five years for skilled workers or three years for others.
What are the work permit costs?
- NPR 15,000 (up to 6 months) or NPR 20,000 (over 6 months).
What visa is required for foreign workers?
- A Non-Tourist Work Visa, aligned with the work permit’s duration.
Can foreign workers send earnings abroad?
- Yes, up to 75% of net income, 100% of retirement benefits, or USD 36,000 per year.
What happens if regulations are violated?
- Fines, visa revocation, deportation, and possible employer sanctions.
Are work permits renewable?
- Yes, within 30 days of expiry, based on performance and sectoral impact.
This guide equips employers with the knowledge to hire foreign workers in Nepal while staying compliant with local laws and meeting business objectives.