Mongolia Employment Law & Compliance Guide for Employers
Key employment laws in Mongolia: what employers need to know
Employment in Mongolia is governed by the revised Labour Law of 2 July 2021, in force since 1 January 2022, the General Law on Social Insurance (in force 2024) and the Personal Income Tax Law. Foreign employers are often surprised that income tax on salaries became progressive (10% to 20%) in 2023 and that foreign staff are covered by social insurance like local staff. This page summarises the core employer rules, with official sources.
Mongolia employment rules at a glance
| Topic | What the rule is | Official source |
|---|---|---|
| Minimum wage | MNT 792,000 a month (MNT 4,714 an hour) since 1 April 2025, under National Tripartite Committee Resolution No. 3 of 7 October 2024. On 17 August 2026 the committee agreed MNT 1,000,000 a month (MNT 5,952.30 an hour) from 1 January 2027. | PwC Worldwide Tax Summaries – Mongolia, significant developments (reviewed June 2026) |
| Standard working hours | Normal working time is up to 40 hours a week and 8 hours a day (Art. 84). Overtime may add up to 4 hours a day, with total weekly hours capped at 56. Shorter hours apply to minors and some other protected groups. | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency) |
| Overtime pay | Overtime generally needs the employee's agreement and is paid at 1.5 times average pay unless time off is given instead. Night work is paid at 1.2 times and work on public holidays at 2 times average pay. | Invest Mongolia Agency – labour (overtime pay, leave, foreign workers) |
| Paid annual leave | Basic paid leave of 15 working days a year once 6 months have been worked (20 for minors and employees with disabilities), plus extra days for long service: 3 days from year 6, rising to 14 days from year 32, and more in non-standard conditions. | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency), Art. 99 |
| Public holidays | 15 public holiday days a year (Art. 97): New Year (1 Jan), Tsagaan Sar (3 days), Women's Day (8 Mar), Buddha's Birthday, Children's Day (1 Jun), Naadam (11–15 Jul), Chinggis Khaan's Birthday, Republic Day (26 Nov) and Independence Day (29 Dec). | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency), Art. 97 |
| Sick leave | Employees on certified sick leave receive a temporary incapacity benefit from social insurance, funded by benefit contributions (employer 1%, employee 0.8%) and calculated from average pay and contribution record. | PwC Worldwide Tax Summaries – Mongolia, other taxes |
| Maternity and parental leave | Pregnancy and maternity leave of 120 days (140 for twins), with a social insurance maternity benefit, then childcare leave on request until the child turns 3. Fathers get at least 10 days of leave at average pay after a birth. | GRATA International – GILS Employment Law: Mongolia (April 2024) |
| Probation period | Up to 3 months, extendable once by up to 3 more months by mutual agreement (Art. 64.2). Probation cannot be used for apprentices, seasonal or one-off work, or temporary replacements. | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency) |
| Notice period | Employer: at least 30 days' written notice for liquidation, redundancy, lack of skills or health unfitness (Art. 80.4); none for serious misconduct. Employee: may leave 30 days after giving written notice, or sooner by agreement (Art. 79). | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency) |
| Severance pay | For liquidation, redundancy, lack of skills or health unfitness (Art. 82): at least 1 month's base salary after 6–24 months' service, 2 months after 2–5 years, 3 months after 5–10 years and 4 months after 10+ years. None for misconduct dismissals. | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency), Art. 82 |
| Employer social contributions | 12.5% to 14.5% of gross pay: pension 8.5%, benefits 1%, health 2%, unemployment 0.5% and industrial accident 0.5%, 1.5% or 2.5% by industry and job. Foreign employees are covered. | PwC Worldwide Tax Summaries – Mongolia, other taxes (reviewed June 2026) |
| Employee social contributions | 11.5% of gross pay: pension 8.5%, benefits 0.8%, health 2% and unemployment 0.2%. Employee contributions are capped at MNT 910,800 a month (exceptions apply). | PwC Worldwide Tax Summaries – Mongolia, other taxes (reviewed June 2026) |
| Income tax on salaries | Employer withholds monthly. Progressive since 1 January 2023 on annual income: 10% up to MNT 120 million, 15% from 120 to 180 million, 20% above. Non-residents pay a flat 20%. | PwC Worldwide Tax Summaries – Mongolia, taxes on personal income (reviewed June 2026) |
| Mandatory bonuses and 13th-month pay | None required by law. Bonuses are payable only if set in the employment contract, a collective agreement or the employer's internal pay rules. | Labour Law of Mongolia (revised, 2021) (Legalinfo.mn) |
| Work permits for foreign nationals | The employer obtains a work permit for each foreign worker from the General Agency for Labour and Social Welfare Services under the Labour Migration Law, typically within about 10 business days. Permits last up to 1 year. The worker also needs a work visa and residence permit. | Invest Mongolia Agency – labour (overtime pay, leave, foreign workers) |
| Employment contract requirements | Must be in writing and signed by both parties, or put in writing within 10 business days of starting work (Art. 48). Contracts are open-ended by default; fixed-term contracts totalling more than 2 years become open-ended (Art. 50). Foreign employees are covered too. | Labour Law of Mongolia (2021), official English translation (Invest Mongolia Agency) |
Employer obligations in Mongolia, topic by topic
Filter by primary service relevance
Does an employment contract in Mongolia have to be in writing, and how long can probation last?
How many hours can employees in Mongolia work, and how is overtime handled?
What is the minimum wage in Mongolia in 2026, and how is it set?
How much paid leave, sick leave and maternity leave do employees in Mongolia get?
What does an employee in Mongolia cost on top of gross salary?
How can an employer end an employment contract in Mongolia, and what does it cost?
Can a company in Mongolia hire a foreign national, and what permit is needed?
Is it risky to use contractors instead of employees in Mongolia?
Key employment laws in Mongolia and official sources
- Labour Law of Mongolia (revised edition, 2 July 2021, in force 1 January 2022) — Main employment law: contracts, probation, working time, leave, termination, severance and dispute resolution; applies to foreign employees too.
- General Law on Social Insurance (7 July 2023, in force 1 January 2024) — Sets employer and employee social insurance contributions for pension, benefits, health, unemployment and industrial accident insurance.
- Personal Income Tax Law (revised 2019; progressive salary rates from 1 January 2023) — Sets the 10%, 15% and 20% rates on salaries and the employer’s monthly withholding duty.
- National Tripartite Committee Resolution No. 3 (7 October 2024) on the minimum wage — Set the minimum wage at MNT 792,000 a month (MNT 4,714 an hour) from 1 April 2025.
- Labour Migration Law (in force 1 July 2022) — Governs invitation and work permits for foreign workers, sector quotas and employer duties; replaced the 2001 law on receiving foreign labour.
- Law on the Legal Status of Foreign Citizens — Governs entry, visas, residence permits and registration of foreign nationals, administered by the Immigration Agency of Mongolia.
FAQs: hiring employees in Mongolia
Can a foreign company hire employees in Mongolia without a local entity?
Not as a direct local employer. To sign Mongolian employment contracts, register staff for social insurance and withhold income tax, a company needs a registered entity or branch in Mongolia. Without one, companies often use an Employer of Record, whose Mongolian entity employs the worker and runs payroll while the client directs the work. Long-term activity in Mongolia can still create a taxable presence, so check that as well.
How much does an employee cost in Mongolia on top of gross salary?
Employer social insurance is 12.5% to 14.5% of gross pay: 8.5% pension, 1% benefits, 2% health, 0.5% unemployment and 0.5% to 2.5% industrial accident insurance depending on the job. The employee’s own 11.5% contributions and income tax are deducted from gross pay. Also budget for overtime premiums, holiday work, severance and any benefits you offer.
What is the minimum wage in Mongolia in 2026?
The minimum wage in Mongolia is MNT 792,000 a month, or MNT 4,714 an hour, in force since 1 April 2025 under National Tripartite Committee Resolution No. 3 of 7 October 2024. It applies nationwide. On 17 August 2026 the committee agreed to raise it to MNT 1,000,000 a month (MNT 5,952.30 an hour) from 1 January 2027, so budget for the higher rate.
How much notice and severance does an employer owe when dismissing an employee in Mongolia?
For liquidation, redundancy, lack of skills or health unfitness, the employer must give at least 30 days’ written notice and issue a written dismissal decision. Severance is at least 1 month’s base salary after 6–24 months’ service, rising to 2, 3 and 4 months after 2, 5 and 10 years. Serious misconduct needs no notice and carries no severance, but the disciplinary procedure must be followed.
Can a company hire a foreign national in Mongolia, and what permit is needed?
Yes. Under the Labour Migration Law, the Mongolian employer obtains a work permit for each foreign worker from the General Agency for Labour and Social Welfare Services, usually in about 10 business days, and generally pays a monthly workplace fee of twice the minimum wage. Quotas for 2026 apply only in two public-sector fields. The worker also needs a work visa and residence permit from the Immigration Agency.
Is it risky to engage contractors instead of employees in Mongolia?
It can be. Civil Code service contracts are lawful for independent, result-based work. If the person works regular hours under your direction and follows your internal rules, the authorities can treat the arrangement as employment. You may then owe back social insurance contributions, income tax that was not withheld, leave pay, severance and penalties. Review long-running contractor arrangements regularly.
Related NNRoad resources for Mongolia: Employer of Record in Mongolia · Payroll in Mongolia · Hiring foreign employees in Mongolia · Contractors and on-demand talent in Mongolia · Mongolia employer cost calculator
Interested In Learning More?
Talk to our local compliance specialists to discuss your specific situation:
Including employment, payroll, tax, and ongoing regulatory obligations.
Hiring in Mongolia without a local company? See our Employer of Record in Mongolia service.
Regulation Updates in Mongolia
Discover the latest employment and compliance updates in Mongolia — helping you stay ahead in a changing regulatory landscape.
Law on Amendments to the Law on Personal Income Tax
What it is: A proposed amendment to the Law on Personal Income Tax that would provide a 100% exemption of personal income tax on monthly income up to 792,000 MNT and adjust simplified reporting thresholds, affecting payroll withholding obligations.
What it changes: The change proposes a 100% personal income tax exemption for monthly income up to 792,000 MNT and adjustments to simplified reporting thresholds, which will affect employer payroll withholding obligations.
Who is affected:
- Employers with payroll withholding obligations
- Workers whose monthly income is up to 792,000 MNT
What employers should do:
- Prepare updates to payroll withholding processes in anticipation of the new exemption and adjusted reporting thresholds
- Review payroll systems and reporting thresholds for alignment with the proposed changes
Notes: Effective month: 2027-01.
Procedure for Issuing Expert Conclusions on Violations of Occupational Safety and Health Standards
What it is: The procedure for issuing expert conclusions on violations of occupational safety and health standards is being jointly developed by the Ministry of Family, Labour and Social Protection and the Ministry of Justice and Home Affairs to formalize how expert determinations are produced.
What it changes: A joint effort will formalize the process by which expert conclusions are produced in cases of occupational safety and health standard breaches, affecting how such determinations are issued and used in enforcement and liability processes.
Who is affected:
- Employers
What employers should do:
- Monitor for updates to the formal procedure and prepare to align internal processes with the newly formalized expert conclusion procedure.
- Coordinate with relevant internal teams to understand how expert conclusions may be issued in cases of OSH standard breaches.
Notes: Effective month: 2026-02.