South Africa Employer of Record & Payroll
Africa Deployments South Africa offers our clients Africa Employer of Record solutions in South Africa covering all of the regions within. We offer full-time employment or fixed terms contracts based on your requirements in South Africa for local hires. ADS will issue local work contracts to your contractors. We will also advise our client’s on best Human Resource (HR) practices when setting up the employee’s locally in South Africa.
ADS takes care of the local tax & PAYE remittances to the Revenue Services on a monthly basis ensuring that they are fully compliant with the law. We will also ensure that their salaries are paid on time monthly and issue them with their pay slips.
In addition to our services we can offer you the employee in South Africa, Medical, Disability, Life, and Workmen’s Compensation Insurances.
South Africa is a country on the southernmost tip of the African continent, marked by several distinct ecosystems. Inland safari destination Kruger National Park is populated by big game. The Western Cape offers beaches, lush Winelands around Stellenbosch and Paarl, craggy cliffs at the Cape of Good Hope, forest and lagoons along the Garden Route, and the city of Cape Town, beneath flat-topped Table Mountain.
What is the main language spoken in South Africa:
There are 11 official languages in South Africa including: English, Afrikaans, Zulu, Xhosa, Northern Sotho, Southern Sotho, Venda, Tswana, Tsonga, Swati, and Ndebele.
What type of employment contracts can you offer in South Africa:
Through our employer of record (EOR) solutions in South Africa, we can offer the following types of employment contracts:
- Fixed Term [not for tasks that are permanent in nature; duration must be specified]
- Indefinite term [most common in South Africa]
Contracts and Offer Letters must:
- Be in writing
- Be in the official local language and the local currency
- Include salary/compensation, benefits and termination requirements
Full-time Employees:
- Have specific working terms and conditions
- Can be eligible for organizational perks and/or other benefits
- Tend to be more focused [as only one employer] and familiar with the specific business – due to e.g. ongoing company training etc.
- Probationary period is 3 months [standard] to 6 months [maximum]
- Probationary period must be a “reasonable time period” within the job context
Standard working hours: Number Overtime to be paid?
In South Africa, the standard working hours are generally 45 hours per week for employees who work more than 5 days a week or 9 hours per day for those who work fewer than 5 days.
Mandatory contributions?
Employee
| Contribution Type | Contribution Rate | Threshold |
|---|---|---|
|
Unemployment Insurance Fund |
1% of monthly remuneration |
Capped at the Monthly Threshold |
|
Skills Development Levy |
Not applicable (paid by employers) |
Not applicable |
|
Pension and Provident Funds |
Varies based on fund or scheme |
Based on employee's earnings and fund rules |
Employer
| Contribution Type | Contribution Rate | Threshold |
|---|---|---|
|
Unemployment Insurance Fund |
1% of employee's monthly remuneration |
Capped at the Monthly Threshold |
|
Skills Development Levy |
1% of total remuneration |
Not applicable |
|
Compensation for Occupational Injuries and Diseases Act (COIDA) |
Varies based on industry and employee's earnings |
No specific threshold |
Social
| Contribution Type | Employers | Employees |
|---|---|---|
|
Unemployment Insurance Fund |
1% of employee's monthly remuneration |
Capped at the Monthly Threshold |
|
Skills Development Levy |
Not applicable (paid by employers) |
Not applicable |
|
Compensation for Occupational Injuries and Diseases Act (COIDA) |
Varies based on industry and employee's earnings |
No specific threshold |
What is the Maternity and Paternity policy within South Africa:
Maternal leave:
- In most cases:
- 16 weeks minimum [4 consecutive months minimum]
- Ideally minimum of 4 weeks to be pre-birth*
- Minimum of 6 weeks to be post birth*
- Medical certification may be required here*
Paternal leave:
- No specific policy in place currently
- 3 days per year [not cumulative] of family responsibility leave may be allocated here
Unpaid leave may also be negotiated [normally ±10 days]
Do I need to pay a mandatory bonus annually OR is it discretionary in South Africa:
In South Africa a performance bonus is not statutory or mandatory, but is normally paid for good performance, hence it is common for this to be incorporated as a condition of employment.
Such a bonus would usually be a percentage of the employee’s renumeration, and paid annually.
What Gratuity / Severance payments do you need to provide for South Africa:
In South Africa, employers are not legally obligated to offer a fixed gratuity or severance payment to employees upon the termination of their employment. However, it’s important to note that severance pay may be applicable in certain circumstances, such as when a company shuts down or undergoes significant workforce reductions. The specific amount of severance pay is typically determined through negotiations between the employer and employee or outlined in collective bargaining agreements within specific industries. It is advisable to carefully review employment contracts, agreements, and consult with professionals to ascertain whether severance pay applies to a particular situation.
Mandatory Probation period of South Africa
In South Africa, there is no set probation period required by law. It varies depending on the agreement between the employer and the employee. During this time, both parties assess if the job is a good fit before committing long-term. It’s important to have clear terms in the employment contract for everyone’s understanding.
Is 13th month pay (Bonus) mandatory?
South Africa has no legislation relating to 13th-month pay. However, it is common in South Africa to give performance-based or incentive bonuses.
Some companies offer a 13th-month pay as part of their employee benefits package, typically paid out at the end of the year, as a discretionary or non-mandatory benefit.
What are the Corporate and VAT / Sales tax rates in South Africa?
Corporate Tax Rates: 27% [in general]
VAT / Sales Tax Rates: 15% [on most goods and services]
Public Holidays in South Africa:
- January 1 - New Year's Day
- January 2 - New Year's Day
- March 21 - Human Rights Day
- April 7 - Good Friday
- April 27 - Freedom Day
- May 1 - Workers' day
- June 16 - Youth Day
- August 9 - National Women's Day
- September 24 - Heritage Day
- September 25 - Heritage Day
- December 16 - Day of Reconciliation
- December 25 - Christmas Day
- December 26 - Day of Goodwill
What Industries we support in South Africa:
- Non-Governmental Organization’s (NGO) / Non- profit
- Engineering & Construction
- Government / Development Agencies
- Oil & Gas
- FMCG & Manufacturing
- Private Equality, Finance, Insurance & Banking
- Mining
- Agriculture
