Ethiopia Employer of Record & Payroll

Africa Deployments Ethiopia (ADS) offers comprehensive Employer of Record (EOR) & Payroll services, covering the entire Ethiopian region. We provide tailored solutions to meet your staffing needs, whether for full-time employment or fixed-term contracts, specifically for local talent. Note that Ethiopia’s HR regulations do not permit the employment of expatriates, and all employment must be for Ethiopian nationals.

As your trusted Ethiopia Employer of Record, ADS ensures full compliance with Ethiopian labor laws, taking care of tax filings, PAYE remittances, and social security contributions. We also manage the timely disbursement of salaries and provide employees with detailed pay slips. Beyond payroll, ADS offers advice on best Human Resource practices to ensure a smooth and legally compliant employment setup in Ethiopia.

In addition, we provide employees with essential benefits, including Medical, Disability, Life, and Workmen’s Compensation insurance. By working with a local Employer of Record, you gain peace of mind knowing that all aspects of employment are handled with care and compliance.

Key Facts about Ethiopia:

• Population: 120.3 million (2021)
• Currency: Ethiopian Birr
• Capital: Addis Ababa
• Languages: Amharic, Oromo, Somali, Tigrigna
• GDP: 111.3 billion USD (2021)
• Main Industries: Agriculture, Textile

Language Breakdown:

• Oromo: 33%
• Amharic: 29%
• Somali: 6%
• Tigrinya: 5%
• Sidama: 3.5%
• Other: 23.5%

Types of Employment Contracts Offered:

• Fixed Term
• Indefinite Term All contracts must be in writing, in the official language (Amharic), and must specify salary, benefits, and termination terms.

Taxation and Employment Compliance: Employees working in Ethiopia for more than 183 days a year are subject to local taxes. Expatriates are not permitted to be employed, and only Ethiopian nationals can be legally employed under the EOR solution.

Mandatory Contributions:

• Employee: Social Security Fund (8%), National Health Insurance (1.5%), National Pension Fund (2%)
• Employer: Social Security Fund (11%), National Health Insurance (3%), National Pension Fund (0.7%)

Maternity & Paternity Leave:

• Maternity: 30 days before delivery, 60 days post-delivery.
• Paternity: 3 days following the birth.

Fringe Benefits: Available but subject to PAYE tax. Benefits that cannot be converted to cash are exempt.

Corporate & VAT Rates:

• Corporate Tax Rate: 30%
• VAT: 15%

Public Holidays in Ethiopia:

• January 7 – Ethiopian Christmas
• January 19 – Orthodox Epiphany
• March 02 – Victory of Adwa
• April 14 – Ethiopian Good Friday
• April 16 – Ethiopian Easter
• April 22 – Eid al-Fitre
• May 01 – Labour Day
• May 05 – Patriots’ Victory Day
• May 28 – Downfall of the Derg
• June 29 – Eid Al Adaha
• September 11 – Ethiopian New Year
• September 27 – Meskel
• September 27 – Moulid

Industries Supported:

• NGOs & Non-Profits
• Engineering & Construction
• Oil & Gas
• FMCG & Manufacturing
• Banking, Finance & Insurance
• Mining
• Agriculture

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