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Updated on:
16 Jan, 2024
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Employer Of Record In Madagascar

Skuad’s Employer of Record Madagascar (EOR) solutions make business expansion to Madagascar easy and hassle-free. Our unique HR platform allows companies to hire exceptionally talented employees in Madagascar, without having to set up a separate legal entity. It streamlines the process of hiring and onboarding a remote team by handling payroll management, taxation, and other legal compliances. To learn more, Book a demo today.

Madagascar At A Glance 

Madagascar is situated in the Indian Ocean and is the fourth-largest island country in the world. Madagascar is only one of the 17 countries in the world to have a megadiverse wildlife climate. 

Population: 27.58 million citizens.

Currency: Malagasy Ariary (MGA).

Capital city: Antananarivo

Languages spoken: Malagasy and French.

GDP: 4.9% at 1,411.46 crores USD(2019)

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Employment In Madagascar 

Things to Know Before Employing In Madagascar

The National Employment Council of Madagascar regulates the employment laws within the jurisdiction of Madagascar. The employment laws also set some criteria for the employer and the employee before they start functioning.

The National Employment Council has made it mandatory to have a written contract for every employee to work in any organization. These contracts must also include details like the benefits, salary, reimbursements, and other agreements. The ILO also grants certain privileges and exempts any employees from discrimination. There are few limitations set like only 30% of the workforce can be of foreign nationality and must pass all the criteria for employment.

Let us take a quick look at the rights and entitlements of employees in Madagascar.

Privileges Explanations
Working hours All employees should work for eight (8) hours for five (5) days every week. The maximum working hours for every week are 40 hours.
Overtime eligibility All employees are entitled to 130% of their usual pay for the first 8 hours of overwork and 150% after that.
Compensation laws in Madagascar The laws governing employment in Madagascar have set the monthly minimum wage to 168089 MGA for general employees and 170442 MGAs for workers from the agricultural sector. It also grants benefits and holidays like national holidays and paid leave for two(2) and a half days for every month of work. The Labour Code of 2006 also regulates salaries.
Forms of wages The International Labour Organization (ILO) stipulates a minimum salary for all the employees in Madagascar. The wages must also account for the average cost of living, status, class, etc. There are three general forms of wages in Madagascar:
  • Fortnight basis: Wages must be paid less than 20 days for workers who work every 14 days.
  • Weekly: wages get paid before the 8th day for workers working on a 7-day basis.
  • Monthly basis: permanent employees are entitled to be paid by the 8th of every month.Weekly: wages get paid before the 8th day for workers working on a 7-day basis.
Maternity Leave Generally, eight(8) weeks and six(6) weeks of paid leave are granted to women before and after the child is delivered. The period of the leave can increase for additional reasons. Women are entitled to their wages which get paid partially by insurance and the employer.
Medical leave Every employee working in Madagascar is entitled to at least five(5) days of paid sick leave, extendable in the case of chronic illnesses. A Certified Health certificate must be provided.
Annual leaves All the employees working in Madagascar have the right to claim 30 days of paid leave per year if they have worked in any organization for more than a year. If these leaves are unused for some reason, they can get transferred to the next calendar year for three(3) consecutive years.
Health benefits in Madagascar The Ministry of Health oversees the health benefits of the employees. All employees have the right to a safe work environment. The administration has also launched several health schemes and programs across the country.
Employee Protection and Anti-discrimination Rights The Labor Code and the provisions of the Constitution of Madagascar state that no employee should face any form of discrimination at work. However, the employer must create a safe workplace since there is no organization to look after the implementation of these laws.
Data protection laws in Madagascar The laws in Madagascar have made it clear that The Malagasy Commission on Information Technology and Liberties will look after all the confidential information related to all the employees. It was adopted after 2014 and came into effect by 2015, more popularly known as the data protection laws.
Paid public holidays list All the employees are generally entitled to 13 paid public holidays:
  • New Year’s Day (1st January)
  • International Women’s Day(8th March)
  • Martyr’s Day (29th March)
  • Easter Day (5th March)
  • Labour Day (1st May)
  • Ascension Day (13th May)
  • Eid ul Fitr (13th May)
  • Whit Monday (24th May)
  • Independence Day (26th June)
  • Eid ul Adha (20th July)
  • Assumption Day (15th August)
  • All Saints Day (1st November)
  • Christmas (25th December)

For starting a business in Madagascar, it is crucial to understand Madagascar’s employment laws and the cultural traditions which dictate the business structure. You can either groom your local team to manage the HR process, which requires a lot more investment of time, effort, and expertise, or you can take aid from any EOR service like Skuad. Skuad can handle all the HR-related responsibilities on your behalf per the law, enabling you to focus on other priorities like growing your business. 

To ensure compliance with Madagascan employment laws, Contact Skuad today

Contractors Vs. Full-Time Employees

There are two types of employees in the country of Madagascar; contractors and full-time employees. Contractors work independently on their terms, as they can work for more than one employer and are responsible for their taxes and other expenditures. Full-time employees have strict orders and rules to follow from a single employer, and they get specific working hours, organizational perks, and other benefits. 

It is vital to understand your business venture and the type of worker it demands before hiring either contractors or full-time employees. Full-time workers are generally more knowledgeable and more focussed on the company's projects as there is only one client. On the other hand, part-time workers are more adaptive and hold more experience. Part-time workers are also economical and have fewer chances of dragging the company into litigation. 

Advantages Of Hiring Contractors:

  1. Adaptability: As contractors get hired for short-term periods, the nature of the work depends on your business venture. New contracts can also be issued anytime.
  2. Cost: Hiring Part-time workers are inexpensive compared to full-time workers, and they will be responsible for their taxes.

Advantages of hiring full-time employees:

  1. Dedication: Full-time employees are expected to stay committed to the company's missions as they get extra benefits for your company.
  2. Training: All the full-time employees go through extensive training to be the best fit for your business venture. They harness particular skills before joining.

Book a demo with us for more information about hiring contractors and full-time employees.

Hiring In Madagascar

According to the laws in Madagascar, the employer must issue an employment contract that contains all the details about the basic salary, holidays, benefits, and compensations. The minimum duration of a contract is six(6) months, which is extendable. The contract must be either in Malagasy or French, and monetary values should be in Malagasy Ariary (MGA). . A company in Madagascar allows employment of 30% of foreign employees and the rest has to be filled by Madagascar citizens.  

You will need to understand the culture and the traditions of Madagascar and the goals of your company, to successfully find the right employees.

Skuad enables organizations to find the best employees for their enterprise. Skuad’s unified employment platform will ensure seamless hiring and onboarding, effective payroll management, and absolute compliance with Madagascar’s taxes and employment laws.

Few portals through which search for candidates in Madagascar are:

  1. Madagascar – Jobs in Africa – Find work in Africa | Careers in Africa
  2. Best job sites in Madagascar | Compare | Jobboard Finder
  3. Portal job Madagascar : offres d'emploi gratuit a Madagascar, recrutement et formation (portaljob-madagascar.com)

To ensure that your hiring process is compliant with the obligatory laws and regulations in Madagascar, speak to Skuad’s experts today.

Probation and Termination

Probation in Madagascar

According to Convention Number 158 of the ILO, a probation period of any employee can last for at least six (6) months. During this period, workers will get debarred of their privileges in the case of inefficiency in productivity. This period can increase if there are no changes in the results, and the employee can get dismissed under reasonable grounds. However, employees get some form of severance pay or other reimbursements. 

Termination in Madagascar

An employment contract can be terminated in Madagascar when the term of the contract comes to an end. There must be some practical reasons for the termination of the employment contract. During the probation, the employment contract can be deemed void without any notification. An employee can get sacked if they are found guilty of any criminal offenses or moral misconduct. Usually, a notice is issued 8 to 10 days before the termination of the contract. Workers are entitled to severance pay in terms of economic conditions.
Find out more about the probation and termination laws in Madagascar at Skuad.

EOR Solution In Madagascar

Madagascar Employer of Record (Madagascar EOR) solution makes it faster and hassle-free for businesses to expand into Madagascar. Leveraging the EOR route ensures effortless and compliant processing of all employment responsibilities including payroll that too without establishing any entity. Skuad can help you manage employment contracts, monthly payroll, taxation, work permits, etc. in Madagascar for your employees.

Topic Explanation
VAT details A VAT rate of 20 % gets levied on most of the goods and services in Madagascar.
Minimum duration of service The minimum duration for a Work Employment contract is six(6) months but extendable with a mutual agreement.
Currency Accepted Malagasy Ariary (MGA).
Required Details & Documents

Important personal information, passport copy, bank-related details, passport size photo,

For outsiders: Personal details, letter of employment from the employer, payment proof duty and responsibilities within the organization, educational and technical qualifications, CV, passport copy, bank details, passport size photos, medical report, and police verification.

Learn More about the EOR Solution in Madagascar in detail.

Types Of Visas In Madagascar

Most overseas workers need a working permit to work in Madagascar. There are two types of visas to enter Madagascar; transferable visas and non-immigrant visas, both of which must be authorized by any recognized Embassy of Madagascar. All visa applicants will need a valid passport of at least six(6) months.

Visa Explanation
Working visa Any employee or employer who seeks to conduct business in the country of Madagascar will need either an immigrant or non-immigrant visa to start their business venture/employment journey. It takes 2-5 days to process a working visa/ transformable visa. It is generally valid for more than 90 days, and it enables the applicant to start working for the company in Madagascar.
Requirements for a Working visa Any individual who wants to obtain a working visa in Madagascar needs to submit the following documents:
  • The employment certificate by the company/ employer in Madagascar.
  • The company’s registration certificate in Madagascar by the Registrar of Companies (RCS).
  • A verified employment contract from the (MFPTLS) Ministry of Public Service, Labor Administration Reform, and Social Laws.
  • Statistics card of the company.
  • Company’s (TIN) Tax identification number.
  • A passport with at least six(6) months validity.
  • A passport with at least six(6) months validity.
  • A completed and verified working visa application from the Ministry of Employment in Madagascar.
Transferable/ Business visa A transferable visa is usually valid for 30 days and allows the visa-holder to start operating in the country. It gets issued from the Madagascar Embassy.
Requirements for a business visa in Madagascar. Any employer who wants to conduct business in Madagascar needs to submit the following to obtain a business visa:
  • A completed and verified application form from the embassy of Madagascar.
  • Details about the return flight.
  • Copy of the passport.
  • The criminal history of the candidate of at least 6 months in the national language of Madagascar to the embassy of Madagascar.
  • A letter of motivation explaining the purpose of the visit.

Skuad can assist you with visas and related procedures. Contact us now to know more

Work Permits

Any person who wants to work in Madagascar will need a work permit with a completed and verified visa from the consulate of Madagascar. However, if the work duration exceeds 90 days, the employee will need a temporary residence visa. Independent contractors can also apply for a working permit without an employment contract, but they will have to fund themselves.

The process of obtaining a working permit in Madagascar is pretty simple:

  1. The employment contract issued by you must be certified by the Department of Labor. Skuad can initiate this application process for the employee, and it does not require their physical presence.
  2. Once the contract is authorized, employees will need to apply for a transformable visa valid for 30 days issued by the Madagascar embassy.
  3. Employees can change their transferable visa to a work and residence permit for the same validity as the duration of their work in Madagascar. It takes around two(2) weeks for a work permit to be processed.

Find out more about obtaining work permits in Madagascar here.

Payroll And Taxes In Madagascar

As a company looking to expand into the Madagascar market, it is essential to be aware of and comply with the tax, business laws, and other regulations. You can choose one of these two routes for your company’s payroll process:

  1. You can groom and micromanage your local team to handle the payroll and taxes payment procedure.
  2. Skuad’s local contacts from Madagascar can assist you in making the payroll and taxes easier. Further, Skuad will manage the payroll of your company as per the Madagascar Laws.

Taxes in Madagascar

Tax Explanation
IRSA (Salary Income tax) The minimum income tax to be levied on any worker is the 2000 Malagasy ariary.
Annual salary Tax rate
0-350,000 Malagasy Ariary 0%
350,000- 400,000 Malagasy Ariary 5%
400,000 to 500,000 Malagasy Ariary 10%
500,000 to 600,000 Malagasy Ariary 15%
More than 600,000 Malagasy Ariary 20%
Corporate tax Companies and business owners on the island of Madagascar need to pay a corporate tax of 20% to the government at the annual rate.
Withholding tax

Interest income: 20%

Dividends percentage: 10%

Sales tax rate 20% sales tax is levied on most of the products and services in Madagascar.
Company social security tax All companies must pay 18% social security tax to the administration for the citizen's welfare.20% sales tax is levied on most of the products and services in Madagascar.
Employee social security tax All employees contribute 1% of their salaries for the country’s welfare towards the employee social security fund.

Connect with Skuad’s experts to leverage the best solution for payroll and taxes for your company.

Incorporation In Madagascar 

As an employer, if you wish to incorporate a subsidiary without any legal presence in Madagascar, you have to know the subsidiary laws and regulations relating to this process. The steps for a successful incorporation of a subsidiary in Madagascar are as follows:

  1. First, you must decide where you will set up the subsidiary or a holding company in Madagascar. You will also need to understand the local rules and regulations which will affect your business. You can also take Skuad’s help with understanding the local laws with the aid of their international contacts.
  2. You will have to choose the entity type for your business company. The most popular form of company is the Limited Liability Company. There are also other options like a Free Trade company, Branch Office, etc.
  3. Every form of business entity has different laws and regulations governing them according to the needs of your business venture in Madagascar.

There are immense business opportunities in Madagascar, and many businesses find it attractive to expand into the country. However, it is essential to know the various laws for incorporation.
Learn more about setting up a subsidiary in Madagascar with Skuad’s robust EOR solution.

Professional Employer Organization (PEO)

Hiring the right employees and compensating them forms an integral part of your business expansion in Madagascar. However, a lack of knowledge of the local law leaves room for error, resulting in heavy penalties for your company.

To safeguard yourself from this, you can opt to engage the services of a Professional Employer Organization (PEO). Even though you can outsource your HR requirements to both PEO and EOR organizations, understanding the minor differences between the two will help you choose what is correct for your organization.

  • A PEO acts as a co-employer and manages all the HR-related functions such as setting up the payroll, processing the compensation and other benefits, and handling all the tax-related compliances. However, your company will hold the allied liabilities and responsibilities.
  • On the other hand, an EOR provider is a complete payroll outsourcing partner that provides all the services offered by a PEO. In addition, it becomes the legal employer of all the employees on your payroll. It means that they are responsible for compliance with the regulations and liable for non-compliance as well.
  • PEOs are suitable for companies looking for a long-term payroll partner, whereas EOR services are more suitable for companies looking for HR solutions for a quick international expansion. Further, while PEOs can only operate if you have an entity established in the country, EOR services have no such requirements.

Skuad provides both PEO and EOR solutions for companies. Hire Skuad’s EOR Madagascar solution to take care of all compliance and HR-related tasks, from onboarding to training and retirement. Talk to Skuad experts to learn more.

Conclusion: What Gives Skuad’s Madagascar Solutions an Edge? 

If your business is ready to benefit from the lucrative business opportunities in Madagascar's growing economy, collaborating with Skuad’s Madagascar EOR services will fulfill all your expansion-related HR requirements. 

Further, our tech-enriched, unified HR platform works with our extensive network of experts from over 150 countries. We can ensure full compliance with the local laws in the country of your choice. 

Want to know more about how Skuad can help your business? Get in touch with us today!


1) What is an employer of record in Madagascar?

An Employer of Record (EOR) in Madagascar serves as the legal employer for employees for a client company. The EOR handles responsibilities such as payroll processing, tax compliance, benefits administration, and ensures adherence to local labor laws. This allows companies to hire employees in Madagascar without setting up a local legal entity.

2) What are the employment laws in Madagascar?

Employment laws in Madagascar are primarily governed by the Malagasy Labor Code. The standard workweek is 40 hours. Employees are entitled to paid annual leave, typically calculated at 2.5 days per month of service, and various types of special leave such as maternity leave. Employees also receive overtime pay for extra hours worked.

3) What is the contract law in Madagascar?

Contract laws in Madagascar specify the terms of employment. They are governed by the Malagasy Civil Code and the Labor Code and include job description, salary, working hours, and duration of the contract (if fixed-term). The Labor Code outlines the rights and obligations of both employers and employees, including conditions for modifying, suspending, or terminating contracts.

4) What is the minimum wage in Madagascar?

The minimum wage is approximately MGA 200,000 per month (around USD 50-55) for non-agricultural workers, while for agricultural workers, it is slightly lower. These rates undergo periodic review by the government to reflect changes in economic conditions.

5) What is the difference between EOR and PEO?

An EOR is the legal employer for workers for a client company, handling all aspects of employment administration. This allows companies to hire employees in foreign countries without setting up a local entity. A PEO, on the other hand, enters into a co-employment arrangement with the client company and shares employer responsibilities with the client. The PEO typically manages HR functions, payroll, and benefits administration, while the client company retains control over workforce management.

EOR in 
best value
Pay monthly at a discounted rate with a 12-month commitment
(billed annually)
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Employ contractors and employees in 160+ countries

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EOR in 
(billed annually)
Pay monthly at a discounted rate with a 12-month commitment
(billed monthly)
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Employ contractors and employees in 160+ countries

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Employ contractors and employees in 160+ countries