Employment of Record In Iraq
Skuad's Iraq EOR (Employer of Record) solution helps your business expand into Iraq without the need for an entity setup. Our unified and automated global HR platform enables you to expedite the onboarding of your remote team and manage their payroll, benefits, and compliances, etc. We help you streamline the global expansion process with the able assistance of our international network.
Iraq At A Glance
Population: 38,433,600 (2018 Estimate)
Currency: Iraqi Dinar
Capital City: Baghdad
Languages spoken: Arabic, Kurdish
GDP: $399.4 Billion (2020 Estimate)
Iraq has always been lucrative for business organizations. The government in Iraq is taking many initiatives to facilitate an entrepreneurial atmosphere in the country and boost the ease of doing business here. If you are looking to expand your business operations in Iraq, you should know that the oil sector drives the economy of Iraq. All prominent multinational companies in the oil business have set-ups here. Whether you are a budding entrepreneur or an experienced business, you need a good local partner to tackle the complexities of employment in Iraq.
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Employment In Iraq
The Iraq employment laws aim to safeguard the employment of workers in Iraq. These laws have several provisions for pension, benefits, and leaves, etc. All employment contracts in Iraq have different clauses, terms, and conditions that all employees and employers should follow.
According to a 2011 survey, an average worker works for about 10.3 hours per week. However, this has increased with corporations expanding into Iraqi territories.
The employment agreements in Iraq also have some laws concerning the employer to ensure the wellness of the employees. The policies also safeguard the employees from unjust practices.
Some of these employee entitlements are as follows:
The system of employee health benefits in Iraq is complex. Companies provide several health benefits to their employees, like insurance cover, etc. The cost of all of this forms a part of the total compensation figure given in the employment contract. Make sure that you read the entire document very carefully before signing it.
An EOR like Skuad handles all the policies related to employee entitlements. Skuad also helps employees who might be confused about the employee entitlements. Book a demo with Skuad to know how it can help you navigate Iraq labor laws and employment contracts.
Contractors vs. Full-Time Employees
While the work of a contractor and a full-time employee can be similar, the laws that protect the full-time employees are very different from the few rules that safeguard the interests of the contractors. Full-time employees have an employment contract with an indefinite period. So, they can fight for their rights in a court of law if they are terminated without a reason. On the other hand, for a contractual employee, the contract may be dissolved as soon as the work is over irrespective of the end date mentioned in the contract. These employees won’t have a case to make if this kind of termination happens.
A contractual employee might get into a standard fixed contract for one year for a job in Iraq. The company can easily withdraw this offer. However, the company will have to intimate the employee at least 30 days in advance that he will no longer be a part of the organization. Every employee, be they contractual or full-time, should have a valid written or typed contract. Verbal contracts are not binding in the court of law. Contracts should specify if they are fixed or indefinite. The status of the contract will depend upon the kind of work, period of employment, etc.
As regular full-time employees, contractual employees can also take leave based on the policy of the company. Therefore, read through the documents carefully to ensure that you are safeguarded against injustice.
Hiring In Iraq
If you want to hire employees in Iraq, you can look for local talent to become a valuable resource for your company. You can surf websites like Trabajos.com, Stepstone, or LinkedIn to connect with the right people. After the pandemic kicked in, people are mostly relying on these websites to look for jobs. However, posting jobs on these sites and finding the right talent can become a little challenging.
There are several hiring companies in Iraq providing EOR services and other related services. These EOR companies are experienced in delivering best-in-class solutions for human resources management. Collaborate with a reputed EOR in Iraq for your hiring needs and give your business valuable resources.
Probation & Termination
In simple terms, probation is a trial period to assess the employee’s performance and behavior. Once the probation period is over, the employee is absorbed as a full-time resource in the organization. Therefore, employees are kept under scrutiny during their probation period.
The standard probationary period in Iraq is up to three months, i.e., it can be a month or two, but not more than three. The duration of the probation period is explicitly mentioned in the contract. Employees must go through the agreement carefully.
Termination of employment in Iraq
Iraq has a very complex system when it comes to the termination of employment. Like any other country, there are several guidelines for termination of employment in Iraq. Therefore, you need to have a comprehensive knowledge of the system and its implications.
Following are the grounds of termination laid down by the Labor Law of Iraq:
- A mutual agreement between the two parties, i.e., the employer and the employee.
- Expiration of a fixed contract.
- Will of the employee.
- In case the employee becomes incapacitated for more than six months due to an illness.
- In case of some significant deformities or if the employee becomes more than 75% incapacitated, he will be terminated.
- The downfall of the company.
Skuad specializes in managing the termination of employees, handling severance pay, etc. Talk to an expert from Skuad today to ensure that the process is carried out without hassle.
An Employer of Record is the perfect way to access the Iraqi workspace without setting up a subsidiary unit. It has many benefits, including eliminating the need to create a separate entity, opening up time and money to concentrate on other facets of growth plans, and simplifying legal compliance.
With Skuad’s experience, company expansion becomes a cost-saving and quicker process without creating a separate team responsible for all workforce management processes. Although companies may set up an organization to engage their personnel, the management of employees, payroll management, and navigating regulatory obstacles can be time-consuming.
If you cannot choose out of the several employers of record companies in Iraq, book a demo now to know how Skuad solutions can give you a competitive edge. Your company will save a lot of time and effort by subscribing to the services of Skuad. It can help you with tailor-made employment contracts, process compliances, compliance with the legal laws, etc.
You can partner with Skuad if:
- Your company is looking to hire talented staff and employees from around the globe.
- If your company is new and has not been appropriately incorporated in Iraq
- If you have a definite budget in place to work with
- If you want to try out a specific alternative in Iraq
- If you need help with payroll, taxation, immigration, recruitment, etc.
Register yourself on the Skuad platform to figure out the best possible course of action for your company's growth.
Types Of Visas In Iraq
Applying for an Iraq work visa is not very complicated. You have to adhere to the Iraq work visa requirements and submit documents like proof of birth, passport, passport-size photographs, etc. As a company, you can also apply for an entry visa on behalf of your employee. The form has to be submitted to the Iraqi embassy of the employee's resident country.
Types of Work Visas
There are two primary kinds of work visas in Iraq:
Get in touch with Skuad to understand the requirement of visas and which kind of visa to be taken.
Getting a Work permit in Iraq can be cumbersome. When a company stationed in Iraq hires a foreign national employee, it has to take care of the work permit for its employees. However, Arab employees do not require a work permit in Iraq, unlike non-Arab foreign nationals, who need a work permit. Getting an Iraq work permit without a job offer is extremely difficult. Therefore, it is recommended to look for a job first and then apply for a work permit. You do not require a work permit if you are a citizen of Iraq and are working in a branch of a foreign company. Skuad can help you obtain a work permit in Iraq and handle all the documentation and the paperwork without any hassles.
Book a demo now!
Payroll & Taxes In Iraq
Iraq’s taxes include a corporate tax that the companies need to pay after being registered in the country. Several rules and regulations are imposed on payroll management of a company with both Iraqi and foreign nationals as employees. Both the regional and foreign companies have to take care of the Iraq payroll tax rates as the taxes must be paid by all kinds of organizations.
Handling the payroll of multiple employees can be tedious. Your company can go ahead with payroll outsourcing in Iraq to manage all the formalities, paperwork, and management of your company's payroll.
Iraq payroll tax rates
Taxes are an integral part of any organization.
Iraq follows a flat Income tax rate system where everyone has to pay 15% of their income as tax.
About 312 hours are given to the employees to prepare and pay the taxes.
Employers of Records companies like Skuad can even handle the tax element for companies. They have been in space for quite a while now, and they know the subject's intricacies.
There are abundant opportunities for business in Iraq. Once you decide the industry and the business model, you can incorporate a holding company in Iraq. You can scan the environment and business opportunities in Iraq and then set up your business here.
It is not necessary to open a new business. You can even expand your existing business in Iraq. While you are setting up your business in Iraq, you need to consider the following factors:
- Business factors such as the industry and the type of the business, trade documents between two countries, etc.
- Location of the business as in the city, locality, etc. You can take help from advisors before deciding a location for your business, as the location is a crucial aspect of any business.
- Regional languages or the languages are spoken in the country.
Under Companies law 21 of 1997, Foreign nationals can come to Iraq and incorporate a company. You can also register a branch of a foreign company under Regulation no 5 of 1989. Obtaining an authorization certificate from the ministry of trade is essential. You can get in touch with an expert from Skuad who can help you understand the law of the land, etc.
Professional Employer Organization (PEO)
A professional employer organization (PEO) collaborates with medium- and small-sized organizations to provide HR services. A PEO handles various HR services such as recruitment, payroll, training, and other HR tasks. An EOR also provides similar HR services; however, the difference lies in the arrangement or association between the outsourcing company and the business.
A PEO acts as your co-employer, whereas an EOR acts as the legal employer of your employees. The latter assumes all the responsibilities and liabilities of your remote team. You can outsource a specific HR function or end-to-end activities.
Furthermore, EORs allow organizations to expand their workforce without setting up a business entity. It handles payroll management, worker’s compensation, and unemployment claims and reports. It files taxes under its file ID number.
Skuad serves as both Employer of Record as well as a professional employer organization in Iraq. Talk to a Skuad expert today to understand the benefits of the two kinds of services offered by Skuad.
Setting up a new entity or expanding into new economies can be a draining process. Though Iraq presents a plethora of opportunities for business expansion, the employment system in the country is complex, especially with regards to employee benefits, termination, and payroll management. Instead of delving deep down into all the nitty-gritty yourself, collaborate with a trusted EOR that has rich expertise in onboarding and managing employees in compliance with the local laws that govern the HR policies of a company.
Your search for a reputed EOR ends with Skuad, a company with a global presence and the best team to help your company scout the best employees in Iraq. Contact Skuad experts to know more.