Zambia Employer of Record & Payroll Solutions

Africa Deployments (ADS) Zambia provides comprehensive Employer of Record (EOR) services across all regions of Zambia. Our solutions cater to full-time and fixed-term employment contracts for both local hires and expatriates. We manage work permits under our umbrella and issue local employment contracts, ensuring compliance with Zambian labor laws.

Our expertise extends to offering best practices in Human Resources (HR) when onboarding employees in Zambia. We serve development agencies, NGOs, and private sector clients, ensuring full compliance with tax and labor regulations. ADS handles monthly tax and PAYE remittances, timely salary payments, and payslip issuance. Additionally, we provide medical, disability, life, and workmen’s compensation insurance options for employees in Zambia.

Key Facts About Zambia

• Population: 19.47 million (2021)
• Capital: Lusaka
• Currency: Zambian Kwacha (ZMW)
• Official Language: English (widely used in government, business, and education)
• GDP: $22.15 billion (2021)
• Major Industries: Agriculture, Industrial Manufacturing, Mining, Oil & Gas, Finance, Engineering & Construction

Employment Contracts in Zambia

Through our Employer of Record (EOR) solutions, we offer the following employment contracts:

• Fixed-Term Contracts – Employment for a specified period.
• Indefinite-Term Contracts – Ongoing employment with standard termination policies.

Contract Requirements:

• Must be in writing and in the local currency (ZMW).
• Should outline salary, benefits, and termination conditions.
• Probationary period: Maximum of 6 months (divided into two consecutive 3-month periods if needed).

Taxable Income in Zambia

Individuals residing in Zambia for more than 183 days annually are subject to local taxation on their earnings. Taxable income includes:

• Wages, overtime, leave pay, commissions, bonuses, gratuities, and allowances.
• Employer-provided benefits like housing, transport, and mobile allowances.
• Non-resident contractors are taxed at a flat rate of 20%.
• Expatriates are subject to standard Zambian tax rates.

Exemptions:

• Ex-Gratia payments
• Medical expenses, discharge, or funeral expenses
• Employment-related expenses
• Fringe benefits that cannot be converted into cash
• Charitable contributions

Working Hours & Overtime in Zambia

• Standard working hours: 8 hours per day, 40 hours per week.
• Overtime compensation: Regular wage + 50% extra per hour beyond standard hours.

Mandatory Contributions in Zambia

Employee Contributions:

• Social Security Fund (CNaPS): 5% of gross salary
• National Health Insurance Fund (CNAM): 1% of gross salary
• National Pension Fund (CNAPS): 5% of basic salary (for salaries above ZMW 1,000)

Employer Contributions:

• Social Security Fund (CNaPS): 5% of gross salary
• National Health Insurance Fund (CNAM): 1% of gross salary
• National Pension Fund (CNAPS): 5% of basic salary

Maternity & Paternity Leave in Zambia

• Maternity Leave: Minimum 12 weeks (84 days), starting no earlier than 8 weeks before the expected delivery date. Fully paid by the employer.
• Paternity Leave: 5 days for new fathers.

Annual Bonuses in Zambia

• Employers must pay a gratuity of at least 25% of base salary at the end of a long-term contract.

Severance & Termination in Zambia

Notice Period:

• Less than 30 days of employment: 24-hour notice
• 1 to 3 months of employment: 14 days’ notice
• More than 3 months of employment: 30 days’ notice

Severance Pay (for economic terminations):

• Employees are entitled to 2 months’ basic salary per completed year of service.
• Changes to employment agreements require employee consent; adverse changes may result in severance payouts.

Probation Period in Zambia

• Standard probation period: 3 months
• Can be extended to 6 months based on employer discretion.

Corporate & VAT Tax Rates in Zambia

• Corporate Tax: 35%
• VAT/Sales Tax: 16%

Public Holidays in Zambia

• January 1: New Year’s Day
• March 8: Women’s Day
• March 12: Youth Day
• April 7: Good Friday
• April 8: Holy Saturday
• April 10: Easter Monday
• April 28: Kenneth Kaunda Day
• May 1: Labour Day
• May 25: African Unity Day
• July 3: Heroes’ Day
• July 4: Unity Day
• August 7: Farmers’ Day
• October 18: National Prayer Day
• October 24: Independence Day
• December 25: Christmas Day

Industries We Support in Zambia

• Non-Governmental Organizations (NGOs)
• Engineering & Construction
• Government & Development Agencies
• Oil & Gas
• FMCG & Manufacturing
• Private Equity, Finance, Insurance & Banking
• Mining
• Agriculture

Zambia’s Double Taxation Agreements (DTAs)

Zambia has DTAs in place with the following countries:

• Africa: Botswana, Kenya, Seychelles, South Africa, Tanzania, Uganda
• Europe: Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Sweden, Switzerland, UK
• Asia: China, India, Japan
• North America: Canada

• Contact Us
  For detailed assistance with Employer of Record (EOR) services in Zambia, including specific payroll and employment solutions tailored to your needs, contact our team at Africa Deployments.