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Employer of Record (EOR) in Zimbabwe

Zimbabwe At A Glance

Population:  14.8 million

Currency: USD

Capital city:  Harare    

Languages spoken:  Chewa, Chibarwe, English, Kalanga, Koisan, Nambya, Ndau, Ndebele, Shangani, Shona, Sign Language, Sotho, Tonga, Tswana, Venda, and Xhosa

GDP: -8.1% (2019).

Employment in Zimbabwe: What You Must Know Before Employing In Zimbabwe?

It is a time-consuming and complex process to establish a branch office or a subsidiary in Zimbabwe for engaging a small team. The strict labor laws in Zimbabwe protect its workers by ensuring that employees have better attention to detail and complete knowledge of the best practices. In such a scenario, if you want to easily expand and hire employees in Zimbabwe, seek Skuad’s EOR solutions to hire the best talent. Skuad will handle the HR and payroll matters ensuring compliance with the local laws without requiring you to set up a foreign branch or subsidiary in Zimbabwe. Contact Skuad experts to know more about its customized solutions.

There are strict laws related to employment contracts in Zimbabwe which protect all types of employees such as those involved in contacts without time limit, fixed-term jobs as well as casual contracts. It doesn't cover the employees in disciplined forces, those in public services, and the cases like the service of an attorney general where the Constitution regulates the conditions of service of the person.

The Public Service Act regulates the service of members in public services. Defense Forces act, Prisons Services Act, and the Police act regulates the service of the members in disciplined forces. Similarly, Judicial Services Act regulate the service of members in the judiciary system.

Entitlement Explanation
Working hours 8.5 hours per day and 44 hours per week. This is set by collective bargaining agreements or other agreements.
Overtime rate 150% of the normal wage is the minimum overtime rate. When overtime is on a public holiday, a 200% premium over the normal salary must be paid.
Public holidays The public holidays in Zimbabwe are:
  • New Year’s Day
  • Robert Mugabe National Youth Day
  • Good Friday
  • Easter Monday
  • Independence Day
  • Workers’ Day
  • Africa Day
  • Heroes’ Day
  • Defense Forces Day
  • National Unity Day
  • Christmas
  • Boxing Day
Medical leave 180 days per year. With a medical certificate, an employee can get fully paid 90 days of medical leave. A written opinion from the doctor is needed for further extending it to another 90 days
Maternity leave Female employees who have completed a year of work with the company can get 98 days of maternity leave, of which 45 days can be taken before birth. Paid maternity leave can be taken only once every 2 years. It must not be more than 3 times while working with an employer as, beyond this, it is unpaid. Newborn’s father is allowed to take up to 12 days of unpaid leave.
Annual leave After completing 1 year of employment, an employee can accrue a month of paid annual leave every year for up to 90 days. Saturdays, Sundays, and holidays falling during this vacation are also counted as a vacation.
Employee health benefits in Zimbabwe The country has universal healthcare. It also has private facilities and healthcare providers. Certain firms provide their employees with private health insurance.

Contractors vs. Full-time Employees

According to Zimbabwe's Labour Act, a person employed under a casual contract with a certain employer for more than 6 weeks in any 4 months consecutively, then becomes a contract of employment without limitation.

This also happens when a contract period for some casual or seasonal work or a specific service exceeds the period of continuous service as specified by the concerned employment council or Minister.

The Labour Law also states that when the fixed-term contract ends but the employee legitimately expects its renewal but the employer employs someone else, then it would mean that the employee had been unfairly dismissed.

Hiring in Zimbabwe

Full-time employees in Zimbabwe are entitled to remuneration for their work at an annual rate but sometimes it becomes expensive on the part of the hiring companies in Zimbabwe to engage full-time employees because of which they opt for independent contractors. They are also known as freelancers and provide services to an organization as per the terms specified in a contract or verbally agreed upon.

There is no clear demarcation between the employees and part-time independent contractors as it evolves continuously. But organizations have separate hiring policies, classifying them, and implementing taxation rules.

Employment contract law, Zimbabwe

It can be a verbal or written one though a written one is always better. Here are the things that have to be included in the written contract in the employment agreement in Zimbabwe:

  • Employer's name and address 
  • Duration of the job is it is for a fixed term
  • Duration of probation if applicable
  • Details about the salary and payment interval
  • Entitlement of the employee to vacation and other leaves
  • Number of working hours
  • Bonus or incentive scheme related details
  • Details related to any other benefits
  • Other employment conditions.

Probation & Termination

Probationary period Zimbabwe:

As per Zimbabwe employment laws, a casual or seasonal worker has a probation period of 1 day. But for other instances of full-time employment, the standard probation period in Zimbabwe is 3 months.

Termination of employment in Zimbabwe:

Employment period Notice period for termination
Seasonal work/ casual work/ less than 3 months of employment 1 day
3 or more months but less than 6 months 2 weeks
6 or more months but less than 1 year 1 month
1 year or more but less than 2 years 2 months
2 or more years or when there is no time limit of a contract 3 months

It involves ending the employment by giving notice in the circumstances related to:

  1. Employment code
  2. Mutually agreed upon termination.
  3. Employment of the employee based on a fixed-term contract.
  4. Pursuant to retrenchment.

EOR Solution

Managing the workforce single-handedly can be highly challenging for organizations expanding into new markets. With Skuad’s EOR solutions, human resource management becomes easy and quick. In Zimbabwe, Skuad can manage your employees' monthly payroll, contracts, taxation, work permits, and other documentation efficiently. Its customized employer of record services will ensure that the needs and issues of employees are addressed while you focus on the operational tasks that are crucial for business expansion. The expertise and experience of Skuad will save your company a lot of time, money, and energy for workforce management and expansion.

You can talk to us to learn more about EOR solutions in Zimbabwe.

Outsourcing Employment Through An Employer of Record:

Skuad provides Employer of Record services for customers who wish to recruit people and run payroll. This facilitates a smoother process that doesn't require establishing branches or subsidiary offices first. Candidates will be hired through Skuad PEO as per the labor laws. This is a quick process that would need a few days instead of taking months for completion. The candidates who are hired will then work on the behalf of your company just like an employee to accomplish the requirements.

Types of Work Visas

Foreign nationals need a visa for visiting Zimbabwe, Here are the three distinctions of the foreign nationals:

Category Explanation
Category A It includes people of the countries which don't need a visa for traveling to Zimbabwe.
Category B It includes foreign nationals who can get a visa on arriving at Zimbabwe airport. The countries are the US, UK, and other member states of the EU.
Category C It includes nations that require getting a visa before traveling to Zimbabwe. The countries are India, Pakistan, some member states of the EU, and others.

Requirements for obtaining a Zimbabwe work visa:

It varies from one embassy to another but needs an applicant to provide a passport with a minimum validity of 6 months and 2 blank pages. Along with this, a certificate of vaccination against yellow vaccination is also needed.

The requirements for obtaining a temporary employment permit are as follows:

  • A job offer letter from a Zimbabwean firm. It is not possible to get a Zimbabwe work permit without a job offer.
  • Proofs showing applicant’s qualification for the position along with previous work experience.
  • 2 photos of passport size.
  • Birth certificate and marriage certificate(if any)
  • Application fee payment.

Getting a visa in Zimbabwe:

Visa applications can be applied at the nearest embassy or through the eVisa System of the Department of Immigration. The employer has to begin the application for the permits if they have foreign employees. Zimbabwe work visa requirements include the following steps:

  • The employee needs to send the required documents to the employer.
  • The employer has to apply for a Zimbabwe work permit for foreigners to the concerned officials in Zimbabwe.
  • The employee can travel to Zimbabwe to start working, once the application is approved.

Work Permits

To sponsor the foreign workers for a work permit in Zimbabwe, Skuad has local partners in the country. It takes care of various needs and responsibilities related to employment through its EOR solution in Zimbabwe. The regular activities and operations of the employees can be easily managed by the client company on the HR platform of Skuad. Book a demo with us today to learn more about the process.

Payroll & taxes in Zimbabwe

Zimbabwe payroll tax rates are applicable on any income such as salary, allowance, leave pay, wages, commission, overtime pay, superannuation allowance, bonus, allowance, gratuity, retiring stipend,  fee, pension, emolument, commutation of a pension, or an annuity, Zimbabwe employer payroll taxes are even applicable on the benefits granted to the employee, his spouse, or kids. This includes the use of furniture, occupation of quarter or residence, motor vehicle, enjoyment of corporeal or incorporeal property like availing a loan, allowance, or other benefits in form of remuneration.

Personal income tax rates in Zimbabwe:

Annual taxable income(USD) Tax rate in USD
0-840 0%
841-3600 0-20% for every USD above 840
3601-12000 552+25% for every USD above 3600
12001-24000 2652+30% for every USD above 12000
24001-36000 6252+ 35% for every USD above 24000
More than 36001 10452+40% for every USD above 36000

Pay As You Earn or PAYE system issued by the country for taxation in which employers have to deduct the taxes directly from the paycheck of their employees. A percentage of an employee's taxable income has to be contributed to AIDS Levy which is currently 3%. This is paid to ZIMRA(Zimbabwe Revenue Authority) during the submission of withheld PAYE amounts by the employer.

Squad's comprehensive solutions help customers run payroll easily as it takes on responsibilities of HR services, taxation, and compliance management matters. You can expect the best practices of employment contracts and trust Skuad to keep its customers informed about any changes in the labor or employment laws in Zimbabwe. Connect with Skuad experts today to learn more about Skuad’s payroll outsourcing in Zimbabwe.

Incorporation

Incorporating a holding company in Zimbabwe needs investing time as well as money. Also, when it comes to expanding to the country, one has to be aware of the laws, the process of hiring employees, running the payroll, and providing compensation and benefits to run the subsidiary successfully.

Here are the steps of setting up a subsidiary business in Zimbabwe:

  1. Check for the location with favorable rules and regulations as it varies between cities, regions, and localities. Working with an expert can help you make the right decision.
  2. Consider the type of subsidiary which suits your business goals because the subsidiary structure is not just one size that fits all. For example, you can opt for a limited liability company or LLC, branches, or representative offices. For handling limited activities, a branch or representative office would be enough but with better benefits and operating freedom, it is recommended to go for LLC structure.
  3. Choose a unique name for the company and complete the registration process.
  4. Get the investment license from ZIA.
  5. Comply with the indigenization requirements.
  6. Depending on the sector you are in, get the operational permits.
  7. Get the residence and work permits from the immigration department.

It is important to follow the correct regulations depending on your subsidiary structure as the concerned laws of Zimbabwe change by the entity. LLCs need to have one director, and one shareholder of any nationality. Since no specific amount has been outlined by Zimbabwe's laws, the minimum paid-up share capital will be decided by the investors. There won't be any annual audit even though the LLCs operate as a resident firm in this country.

Advantages of the incorporation process in Zimbabwe:

After completing the process of setting up a subsidiary, the firm will be entitled to all advantages of working in Africa. It can operate with new firms, get benefits from new employees, provide the new client base with updated products and services.

You can also protect your parent company and subsidiary through the LLC structure. Shareholders are limited in liability by the amount they contribute, and your parent company and subsidiary will operate separately to avoid fines and litigation.

Sometimes it takes a month to as long as a year to avail these advantages but in many cases, businesses need to begin operating immediately or expand quickly by sticking to the subsidiary laws. Book a demo today to learn more about incorporating a subsidiary in Zimbabwe.

Professional Employer Organization (PEO)

Companies outsource human resource functions such as payroll, training, benefits, and guidance for assisting small and medium-sized firms to PEOs. A PEO helps in maintaining compliance with the labor and employment laws of the federal and state.

A CSA or Client Service agreement is signed between the client company and PEO which specifies the following:

i. For certain administrative services, PEO acts as an administrative employer and client as a worksite employer.

ii. Client company hires and manages the employees and handles various other aspects

such as sales, marketing, and customer service.

iii. Employee wages, benefits, withholdings, remission, and reporting of taxes to any state and federal authorities during the CSA are all processed by PEO.

iv. As specified in the CSA, the client company and the PEO share some responsibilities like developing an employee handbook.


PEOs and EOR companies both provide HR solutions but differ on the following grounds.

  1. PEOs act as co-employers of your company. It implies people hired by you are employees of your company. EOR acts as the legal employer of your employees.
  2. You are still the decision-maker in HR functions if you collaborate with a PEO whereas EOR will make all decisions regarding employee management. EOR will hire the employees, look after the contracts, benefits, and insurance.
  3. EOR is better than PEO in risk management and employee benefits as EOR leaves you with less paperwork related to insurance so that you can have more time for planning your business. Besides this, EOR takes the full liability of arranging employment for the client company.

i. You need a cost-efficient solution for the conversion of international contractors to employees. Your current contractors are also asking  for improving their working status to full-time employees

ii. When you have an overseas contractor and you intend to convert them into your employee, invest in them and prove your commitment to them

iii. You want to avoid setting up any legal entity while converting your contractors to employees. 

iii. When you find it is expensive and risky to maintain compliance with a foreign corporate entity for your benefits and it doesn't align with your long-term goals.

iv. When you are looking for an interim solution for immediate hiring while setting up your foreign entity.

So, if you are an employer and have been looking for an EOR, contact us today to talk to Skuad Experts who can walk you through all the details of employment and hiring in Zimbabwe.

Conclusion

If you have been looking for employers of record companies in Zimbabwe, then your search ends here as Skuad makes it easy for firms to expand their business in foreign countries. Since market compliance takes a lot of time and energy, it assists in the process of getting a Zimbabwe work visa, work permits, payment of local taxes, and payroll matters along with all other support related to tapping the wider talent pool in a hassle-free manner. This is applicable when firms are looking for contract workers or full employees. Chances of running into the risk of paying fines or getting penalized are drastically reduced. With Skuad’s dedicated team of experts, the cross-border business expansion will no longer be a limitation for companies.

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