Employing remote workers in Africa? How to stay compliant

1. Remote or hybrid worker?

There is an important distinction that needs to be made between remote and hybrid workers. While both are employees, there are critical differences:

• Hybrid workers

Hybrid workers work partly at the office (or some other designated location such as a co-working space), and partly in a remote way: either at home or in a location-independent way.

• Remote workers

Remote workers, on the other hand, do not come to the office or another designated location. They are typically fully location-independent and can be located anywhere in the globe, as long as they have a good internet connection.

2. Labour contracts and establishing a primary work location

While remote employees are not location-dependent, they must still declare a primary work location.

Why?

There are many reasons, the most important of which is establishing which country’s laws govern the employee –subsequently determining their work relationship with you and their worker rights. Remote workers must absolutely do this, even if they are always on the move, and even if they wound up spending more time in one country than in the country designated as their primary work location.

So, for example, if your business operates in Côte d’Ivoire (Ivory Coast), and you want to onboard a remote worker from Angola, the worker in question will be bound by Angolan labour law. This remote employee will need to be given the statutory benefits as stated by Angolan labour law. This also means that their employer and employee contributions must be calculated and remitted to Angolan authorities.

Complex legislation

In some African countries, employers may run into more complex issues when employing remote workers.

In some countries, depending on the remote employee’s nationality, the latter may be required to get a specific visa to allow them to work in the country. Employers may then be required to certify that this employee is working for them.

Further complications can arise when, in some cases, remote employees are required to pay taxes or make contributions in more than one country, if they stay there long enough. This is known as double taxation. Bilateral non-double taxation treaties exist, but unfortunately not between all African countries. As such, this may be an issue that remote employees have to face. This issue can then escalate to the employer’s level.

As an employer yourself, these extremely complex regulatory issues may prove to be too much to manage all on your own. Besides, even when the situation is more straightforward, having several remote employees – each from a different country, governed by a different set of regulations, and owed different worker rights – adds several new layers of complexity to the situation. In such cases, many companies risk non-compliance, a serious offence which can result in fines, legal sanctions, as well as a damaged employer reputation.

In these cases that require deep legal understanding, it is not recommended to take on the responsibility of compliance all by yourself.

Instead, working with an EOR may prove a better use of your time and resources.

Looking for an EOR? Africa HR Solutions is here to help.

3. Contracts and onboarding

Before onboarding remote workers, one important step for companies to take is to verify whether the person they intend to onboard can actually work in the country they want to declare as their primary work location.

Beyond that, it is well within the employer’s rights to dictate where an employee should work from. In the employment contract, employers may specify an African country in particular, or an African region, as well as a list of countries that an employee can work from, all while taking time zones and time differences into account. After all, if an employee is working at night because of the time difference between the country you operate in, and the country they work on, this employee may be entitled to night pay.

4. Salary

When employing a remote worker, the salary offered to the latter must comply with the labour law from the country which is the worker’s primary work location. This means keeping up to date with the minimum wage in that country, and also considering any mandatory monetary bonuses such as the 13th month, the 14th month, and performance bonuses. In this list of considerations, employers should also add overtime pay, night/unsociable hours pay, payroll frequency as prescribed by the law or as is customary in the primary work location.

5. Benefits

Any benefits a remote employee receives must be aligned with the benefits prescribed and mandated by the labour law they are governed by. As such, employers must be careful and account for both employer and employee contributions, among which are:

1. Social security contributions
2. Pension contributions
3. Health insurance contributions
4. Life insurance contributions
5. Unemployment contributions (by the employee)

Other benefits include statutory maternity leave, paternity leave, as well as workmen’s compensation.

6. Taxes

Employers ought to carefully consider tax deadlines, tax rates (all of which are heavily conditional), and tax remittances when employing remote workers based in other countries.

7. Leave

In Ghana for instance, employees are entitled to 15 fully paid working days for their annual leave, after completion of 12 months of continuous service. In Mauritius however, workers who have completed 12 consecutive months of continuous service, are entitled to 22 working days’ leave on full pay.

So, depending on where your remote worker is based, and depending on the laws they are governed by, it may be that your remote employee is entitled to more, or fewer annual leave than your on-site, in-country workers are.