Hire in South Africa

South Africa PEO &

Employer of Record

Hire & manage teams remotely in South Africa without a local entity. We handle HR compliance, payroll & taxes so you can focus on your business.

Business Language

English, Afrikaans

Salary Currency

South African Rand (ZAR)

Capital city

Pretoria

Time zone

UTC +2

EOR in South Africa

Hire Employees in South Africa

NNRoad provides professional employment organization (PEO) & employer of record (EOR) services in South Africa to ensure that your business complies with local labor laws and regulations. We process monthly payroll and act as the Employer of Record, taking on all local employer liabilities.

Fast Hiring

Start working with your remote employees in a week.

Foreigner Visas

NNRoad assists with overseas foreign hires visa needs.

Platform

Access your payroll reports on our portal.

Employer of Record in South Africa

Employer of Record (EOR) services are for companies who do not have a legal entity in South Africa, but who want to hire localy. Employment and full liability are outsourced to NNRoad.

1. Candidate Selection

Select the candidates you want to hire in South Africa.

2. Employee Onboarding

We sign a local labor contract with your employees based in South Africa.

3. Compliance & Payroll

We manage monthly payroll, mandatory benefits & all HR compliance in South Africa.

EOR service includes:

Hiring and termination of employees/local labor contracts (contract administration – engagement, extension termination and conversion to permanent hire).

All mandatory employer (and employee) contributions filed and paid for your EOR employees.

Payroll recording, reporting and administration.

Distribution of salaries to employees through direct deposit into their bank accounts.

Calculation, reporting, filing and processing of EOR employee’s individual income tax due.

Collecting and processing your employee’s invoices for business related expenses.

Guiding and organizing your expat employee’s work visa application too guarantee their successful onboarding.

Standalone Payroll & PEO in South Africa

Professional Employment Organization (PEO) services are for companies who have a legal entity in South Africa, and want to outsource their payroll. Employment liabilities are shared between your organization and NNRoad.
PEO and employer of record in South Africa

Employee Income Taxes:

Individual income tax rates in South Africa are based on progressive tax brackets.

Tax Brackets:

Sample Calculation

18%: 0 – 266,000 ZAR
26%: 266,001 – 353,000 ZAR
31%: 353,001 – 488,700 ZAR
36%: 488,701 – 641,400 ZAR
39%: 641,401 – 817,600 ZAR
41%: 817,601 – 1,731,600 ZAR
45%: Over 1,731,601 ZAR
Single taxpayer yearly income = 1,000,000 ZAR

0.18 * 266,000 = 47,880
0.26 * (353,000 – 266,001) = 22,620.74
0.31 * (488,700 – 353,001) = 42,006.69
0.36 * (641,400 – 488,701) = 54,971.64
0.39 * (817,600 – 641,401) = 68,637.61
0.41 * (1,000,000 – 817,601) = 74,723.59

Yearly income tax = 47,880 + 22,620.74 + 42,006.69 + 54,971.64 + 68,637.61 + 74,723.59 = 310,840.27 ZAR

Employer Contribution

1% – Skills Development Levy (SD)
1% – Unemployment insurance (UIF)

Total employment cost: 2%

Employee Contribution

1% – Unemployment insurance (UIF)

Total employment cost: 1%

Pension Fund

The Unemployment Insurance Fund (UIF) gives short-term relief to workers when they become unemployed or are unable to work because of maternity, adoption and parental leave, or illness. It also provides relief to the dependents of a deceased contributor.

Healthcare Insurance

South African citizens and permanent residents get free primary healthcare, however, it is means-tested and mostly provided to individuals with lower earnings. Those who earn more than the poverty line will have to pay for some or all of the treatment they receive from the government health system.

Working Hours Per Week

The Basic Conditions of Employment Act (BCEA) stipulates that the maximum weekly regular working time is 45 hours. If the employee works a five-day week, this is nine hours per day (excluding lunch), and if the employee works more than five days per week, this is eight hours per day (excluding lunch). This does not imply that the employee must work normally for 45 hours per week. The amount of typical time worked is determined by a contract between the employer and the employee.

Overtime

All overtime is optional, and it can only be worked if both the company and the employee agree. The maximum amount of overtime that can be worked in a single day is three hours or ten hours in a week. Except for Sunday and public holiday labor, which must be paid at twice the standard wage rate, remuneration must be 1.5 times the normal salary rate.

An employee has the right to a fair dismissal under the Labour Relations Act 66 of 1995 (“LRA”).

A fair dismissal must be equitable in both substance and procedure.

In terms of the LRA, there are three recognized fairgrounds of dismissal:

Misconduct;
1. Operational Requirements (redundancy/retrenchment); or
2. Incapacity (this is inclusive of ill health, poor work performance and incompatibility).

Severance

In South Africa, severance pay usually consists of 1 week’s salary for every year of service. This is usually only given for redundancy, not for other types of dismissals.

Notice Period

The notice period for termination depends on the length of service:

1 week – in case the employee has been with the company for 6 months or less
2 weeks – in case the employee has been with the company for more than 6 months but less than one year
4 weeks – in case the employee has been employed for more than one year

Employment Contract

It is critical that an employee’s status – permanent, fixed-term, temporary, and so on – be determined from the start of the employment relationship. Section 29 of the Basic Conditions of Employment Act mandates that certain written employment particulars be provided as a minimum, and every employer is legally obligated to disclose these minimum particulars in writing to all employees no later than the first day of employment. Even if there isn’t any legal requirement to give a written contract, it is strongly advised for employers to provide a written contract to the employees, so to avoid potential problems in case of labor disputes.

Probation Period

Probationary durations should be kept to a minimum. This will be determined by the nature of the job, which will determine how long it takes to evaluate whether or not the employee is functioning properly. As a general rule, the longer the probation time, the more complicated the task is.

Annual Leave

An annual leave cycle is a 12-month period with the same company, beginning with the employee’s first day on the job or ending with the employee’s previous leave cycle. In each annual leave cycle, an employee is entitled to 21 consecutive days of paid annual leave; if an employee works a five-day week, this equates to 15 working days; if an employee works a six-day week, this equates to 18 working days.

Sick Leave

In South Africa, paid sick leave is calculated on a three-year cycle (at 100% of the employee’s usual rate of pay). For every 26 days worked during the first six months of employment, the employee is entitled to one day of paid sick leave.

From the first day of the 7th month, the employee receives:

  • 30 days if they work a 5-day work week
  • 36 days if they work a 6–day work week
  • 33 days days if an employee works Monday- Friday and a Saturday every two weeks
  • No paid sick leave if an employee works less than 24 hours a month.

    Maternity Leave

    A pregnant employee is entitled to four months of unpaid maternity leave under South African labor legislation. The employee can take the leave starting four weeks before the due date and must not return to work until six weeks after the due date. If the employee has paid into UIF, they may be eligible for a maternity benefit of up to 60% of their usual salary rate, depending on their income and insurance coverage.

    Paternity Leave

    There isn’t any statutory paternity leave for father but when their children are born/given to the parent, all new parents, including fathers, adopting parents, and surrogates, are entitled to ten days of unpaid parental leave (s).

    Unpaid Childcare Leave

    In South Africa, mothers are entitled to up to four months of unpaid leave within four weeks after giving birth, or sooner if a medical expert deems it appropriate. In the contract between the employer and the employee, more liberal terms can be negotiated.

    Study Leave

    An employee in school can take two paid days per topic per year, up to a total of ten paid days per year, at the employer’s option. Any additional absence taken for the purpose of studying after the ten days must be taken as unpaid leave.

  • Public Holidays

  • New Year’s Day – January 1st
  • Human Rights Day – March 21st
  • Good Friday – April 15th
  • Family Day – April 18th
  • Freedom Day – April 27th
  • Labour Day – May 1-2
  • Youth Day – June 16th
  • National Women’s Day – August 9th
  • Heritage Day – September 24th
  • Day of Reconciliation – December 16th
  • Christmas Day – December 25th
  • Day of Goodwill – December 26th
  • PEO EMPLOYER OF RECORD IN AFRICA

    Resources

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