South Africa Payroll Outsourcing

• Population: 60,041,996
  
• Gross Domestic Product (GDP): $419.95 B
• GDP Growth (April 2021): 4.9%
• Inflation, consumer prices: 4.6%
• Foreign Direct Investment (% of GDP): 0.9%
• Unemployment Rate: 33.6%
• Capital: Pretoria (executive), Cape Town (legislative), Bloemfontein (judicial)
• Currency: South African Rand
  
• Languages: Afrikaans, English, Xhosa, Zulu

Employer Contribution

• 1.00% of the employer’s emoluments must be contributed to social security for the Unemployment Insurance Fund (UIF)
• Additionally, the employer must contribute to the Compensation Fund payable on an annual remuneration of up to ZAR458,520.

Employee Contribution

• 1.00% of the employee’s emoluments must be contributed to social security regarding the Unemployment Insurance Fund.

• Value-added tax (VAT)

  The standard VAT rate is 15% in South Africa. Certain food products and other supplies are zero-rated in the country. Financial services, public transport, and accommodation are generally exempt from VAT.

Paid Time-Off

If the employee works five days a week, they are then entitled to 15 days of paid leave per year. However, best practice sees employees generally receiving to 21 days of paid annual leave.

Sick Leave

According to Section 22(1) to 22(4) of South Africa’s Employment Act, during each 36-month cycle starting from the first day at work, an employee is entitled to a paid sick leave. This should be equivalent to the exact number of days they work in a 6-week period.

If the employee works five days a week, they are then entitled to 30 days of sick leave with pay. If they work for six days a week, the amount is increased to 36 days. An employee may have 10-12 days of paid sick leave per year on average when distributed across 3 years.

Maternity Leave

In South Africa, women are entitled to 4 months of maternity leave. According to South Africa’s law, an employer has no obligation to provide paid maternity leave to their employee. However, the latter is still entitled to four consecutive months of maternity leave.

Paternity Leave

In South Africa, men are entitled to 10 days of parental leave.

Under section 37 of the BCEA, employees in South Africa may provide notice of their resignation/employers may provide notice of termination within the following periods:

• 1 weeks’ notice, if the employee has been employed for six months or less.
• 2 weeks’ notice, if the employee has been employed for more than six months but less than one year.
• 4 weeks’ notice, if an employee has been employed for one year or more.
• 4 weeks’ notice, if an employee is either a farmworker or a domestic worker who has been employed for more than six months.

A shorter notice period is possible with an agreement from both parties.

In South Africa, the minimum severance pay should be equal to 1 weeks’ pay for each completed year of service.

However, if the specified amount in the employment contract is larger, the employee is then entitled to the agreed amount.

• New Year’s Day (1st January)
• Human Rights Day (21st March)
• Good Friday (10th April)
• Family Day (13th April)
• Freedom Day (27th April)
• International Workers’ Day (1st May)
• Youth Day (in South Africa) (16th June)
• National Women’s Day (10th August)
• Heritage Day (24th September)
• Day of Reconciliation (16th December)
• Christmas Day (25th December)
• Boxing Day (26th December)