Hire in Sri Lanka

Sri Lanka PEO &

Employer of Record

Hire & manage teams remotely in Sri Lanka without a local entity. We handle HR compliance, payroll & taxes so you can focus on your business.

Business Language

Sinhalese, Tamil

Salary Currency

Sri Lankan Rupee (LKR)

Capital city

Sri Jayawardenepura Kotte

Time zone

UTC +5:30

EOR in Sri Lanka

Hire Employees in Sri Lanka

NNRoad provides professional employment organization (PEO) & employer of record (EOR) services in Sri Lanka to ensure that your business complies with local labor laws and regulations. We process monthly payroll and act as the Employer of Record, taking on all local employer liabilities.

Fast Hiring

Start working with your remote employees in a week.

Foreigner Visas

NNRoad assists with overseas foreign hires visa needs.


Access your payroll reports on our portal.

Employer of Record in Sri Lanka

Employer of Record (EOR) services are for companies who do not have a legal entity in Sri Lanka, but who want to hire localy. Employment and full liability are outsourced to NNRoad.

1. Candidate Selection

Select the candidates you want to hire in Sri Lanka.

2. Employee Onboarding

We sign a local labor contract with your employees based in Sri Lanka.

3. Compliance & Payroll

We manage monthly payroll, mandatory benefits & all HR compliance in Sri Lanka.

EOR service includes:

Hiring and termination of employees/local labor contracts (contract administration – engagement, extension termination and conversion to permanent hire).

All mandatory employer (and employee) contributions filed and paid for your EOR employees.

Payroll recording, reporting and administration.

Distribution of salaries to employees through direct deposit into their bank accounts.

Calculation, reporting, filing and processing of EOR employee’s individual income tax due.

Collecting and processing your employee’s invoices for business related expenses.

Guiding and organizing your expat employee’s work visa application too guarantee their successful onboarding.

Standalone Payroll & PEO in Sri Lanka

Professional Employment Organization (PEO) services are for companies who have a legal entity in Sri Lanka, and want to outsource their payroll. Employment liabilities are shared between your organization and NNRoad.

Employee Income Taxes:

Individual income tax rates in Sri Lanka are based on progressive tax brackets.

Resident individuals are subject to income tax on their worldwide income. Non-resident individuals are taxed only on their Sri Lanka-sourced income.

Tax Brackets:

Sample Calculation

6%: 0 – 3,000,000 LKR
12%: 3,000,000 – 6,000,000 LKR
18%: Over 6,000,000 LKR

Employer Contribution

12% – Provident Fund (EPF)
3% – Employee Trust Fund

Total employment cost: 15%

Employee Contribution

8% – Provident Fund (EPF)

Total employment cost: 8%

Pension Fund

The Employees’ Provident Fund (EPF) was established under the EPF Act No.15 of 1958 (Act) as a mandatory defined contribution retirement scheme for the private and semi-government sector employees who do not enjoy pension benefits.

It is required by the law that both employers and employees contribute the fund. The purpose of the fund is to give a pension for employees that retire. The retirement ages are 55 years old for males and 50 years old for females.

Working Hours Per Week

The normal working hours of a regular employee shall not exceed 8 hours per day. In any one week, working hours shall not exceed 45 hours. Overtime shall not exceed an aggregate of 12 hours in any one week.


No employee is required to work overtime, unless he is paid separately for such overtime work in respect of each hour, at a rate not less than 1.5 times the hourly rate of his ordinary remuneration.


Workers who have worked for an employer with fifteen or more employees for five years are entitled to severance pay at the following rates if the services are terminated (whether by the employer or the employee, or on retirement or death, or by operation of law, or otherwise):

  • Half a month’s wages or salary for each completed year of service for monthly rated workmen;
  • 14 days salary for each year of completed service for other workmen.

    Notice Period

    The IDA and the TEWA oversee the dismissal process in Sri Lanka, and termination of employment for non-disciplinary grounds usually necessitates clearance from the Commissioner of Labor. Non-disciplinary termination requires a notice period (typically one month) that is mutually agreed in the contract of employment.

  • Employment Contract

    The written employment contract must include the following particulars: the name of the employee and designation and nature of the appointment; the date on which the appointment takes effect; the grade to which the person is appointed; basic remuneration and the scale of remuneration; probation period; working hours.

    Sri Lankan labor law allows for the hiring of fixed-term contract workers for long-term duties.

    Probation Period

    In Sri Lanka, there is no explicit provision in the labor rules regarding the length of a probationary period. Probation typically lasts six months.

    Annual Leave

    After completing a complete year of employment, employees are entitled to 14 days of yearly leave. Annual leave is accrued based on the date the employee joined the organization after the first year.

    Sick Leave

    All employees are entitled to 7 days of sick leave per year.

    Maternity Leave

    Women with no or one child are entitled to twelve weeks of maternity leave. Two weeks prior to the due date and ten weeks after the due date should be taken.

    Women with two or more children are entitled to six weeks of maternity leave. Two weeks prior to the due date and four weeks after the due date should be taken.

    Public Holidays

  • Tamil Thai Pongal Day – January 14
  • Duruthu Full Moon Poya Day – January 17
  • National Day – February 4
  • Navam Full Moon Poya Day – February 16
  • Mahasivarathri Day – March 1
  • Madin Full Moon Poya Day – March 17
  • Sinhala & Tamil New Year Day – April 13-14
  • Good Friday – April 15
  • Bak Full Moon Poya Day – April 16
  • May Day – May 1
  • Id Ul-Fitr – May 3
  • Vesak Full Moon Poya Day – May 15-16
  • Poson Full Moon Poya Day – June 14
  • Id Ul-Alha – July 10
  • Esala Full Moon Poya Day – July 13
  • Nikini Full Moon Poya Day – August 11
  • Binara Full Moon Poya Day – September 10
  • Milad un-Nabi – October 9
  • Vap Full Moon Poya Day – October 9
  • Deepavali – October 24
  • Ill Full Moon Poya Day – November 7
  • Unduvap Full Moon Poya Day – December 7
  • Christmas Day – December 25
  • Employees in Sri Lanka


    Scroll to Top