The government has formed a study committee to review the service fees that workers going abroad for employment must pay to manpower agencies. The committee is finalizing its report. Manpower operators have long argued that the existing fee of NPR 10,000 is insufficient to cover their costs, and they have persistently demanded an increase. Labor experts, however, suggest that setting legal fee limits alone will not stop workers from being overcharged, and propose adopting international practices where employers bear all recruitment expenses.
Kathmandu, July 21 — The government is preparing to fix the service fees payable by workers going abroad for foreign employment. To this end, the Ministry of Youth, Labor and Employment has formed a study committee, which is nearing completion of its report. Manpower operators are encouraged by the government’s move, as they have long been requesting the revision of the service fee. They claim the current NPR 10,000 fee does not cover operational and labor management expenses.
However, labor specialists question the assumption that simply fixing the service fee will prevent extra charges. The government had fixed the service fee at NPR 10,000 twelve years ago, which remains the legal provision. In practice, most workers end up paying from NPR 100,000 up to NPR 300,000. The debate now hinges on how establishing a new fee will prevent unauthorized overcharging that the law failed to curtail earlier.
“If the old regulation could not be enforced, how can the new one prevent overcharging?” says Rameshwar Nepal, a labor and migration expert. He points out that although the legal ceiling is NPR 10,000, workers have paid as much as NPR 200,000 to NPR 300,000. Even if the government sets a fee equivalent to one month’s salary, manpower agencies’ compliance with not charging extra remains questionable.
According to Nepal, once the fee is legally raised, manpower agencies will legitimately collect that amount, but may still charge separately for airfare, medical tests, insurance, training, and other expenses. “Today the fee is NPR 10,000, and it is not fully enforced. If tomorrow it is set at NPR 40,000–50,000, workers will still have to pay additional amounts for tickets and other fees. So on what basis can the government prevent overcharging?” he asks.
Nepal argues that without effective regulation, simply raising the fee is not a solution; it may only legitimize additional charges. He recommends that Nepal adopt international best practices where employers cover the entire recruitment cost, along with diplomatic efforts to implement effective agreements with destination countries.
He warns that as long as the current model of charging fees directly from workers remains, high fees and overcharging will continue despite legal caps. An example is the previously predetermined fees for Malaysia and Gulf countries fixed at NPR 80,000 and NPR 70,000 respectively until 2015, yet investigations revealed charges of up to USD 1,000. A 2011 Amnesty International study similarly reported fees reaching that amount.
Given this, widespread questions remain over guaranteeing manpower operators will not charge more if the government sets a fee equivalent to one month’s salary or a fixed amount.
Operators Claim: Cashless Digital Systems Will Eliminate Malpractices
Manpower operators argue that the current fixed fee of NPR 10,000 has contributed to rising malpractice. They believe that government regulation of fees coupled with digitalization will eradicate these issues. According to Dik Bahadur Khatri, chairperson of the Nepal Foreign Employment Association, digitalizing the entire process will help control excess charges.
He states that the government should clearly publicize cost categories and service fees for each destination country, and then implement cashless payment systems through banking channels with full monitoring of applications and payments via the ‘Shram Sansar’ portal.
Khatri adds that once cost breakdowns are transparent and accessible, workers will find it easier to avoid paying beyond the stipulated amount. The association is also preparing to implement its own code of conduct, grievance redressal, and service audit systems. He believes that without cash or alternative payment methods, operators cannot overcharge workers, and only a single-window digital control system will effectively regulate the sector. He stresses that the government must take strict action against any operator who charges extra.
Former association chair Rajendra Bhandari emphasizes the need to track payments digitally. “A control mechanism is necessary. Payments by workers must be made through digital transactions. If operators are enabled to operate accordingly, extra charges can be prevented,” he says.
Since 2015, the law has capped service fees at NPR 10,000, but this has not been effectively enforced. If new regulations are implemented in the same manner, even fees set at NPR 50,000 may still result in workers paying additional amounts.
To alleviate the financial burden on Nepali migrant workers, the ‘Free Visa Free Ticket’ policy was introduced in 2015. Then Labor State Minister Tek Bahadur Gurung implemented this policy, fixing the manpower service fee payable by workers at NPR 10,000 for major destination countries including Saudi Arabia, Qatar, Kuwait, Bahrain, Oman, UAE, and Malaysia, effective from June 9, 2015.
Manpower operators have opposed this fee, demanding fees equivalent to one to one-and-a-half months’ salary. The Ministry of Labor is now studying the matter. Previous studies have been conducted, but some highlighted that fee-setting falls outside their remit and requires political decisions.
