Employer of Record Mozambique
Skuad’s Employer of Record Mozambique (EOR) solutions make business expansion to Mozambique easy and hassle-free. Our unique HR platform allows companies to hire exceptionally talented employees in Mozambique, 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 via its unified employment platform. Book a demo to learn more today.
Mozambique At A Glance
Population: 3.04 Crores
Currency: MZN, Mozambican Metical
Capital city: Maputo
Languages spoken: Portuguese
Annual GDP growth rate: 1.7% (2021)
What You Must Know Before Employing In Mozambique
A large number of Mozambican people are involved in the unofficial or grey economy. Consequently, the present rate of confederation is low. The comprehensive framework of the workforce stays firm and tight. As a result, it creates an obstruction to financing and funding even after the commencement of the improved and verified Mozambique Labor Law in 2007, which applies to both citizen and non-citizen employees. Book a demo to know more.
| Entitlements |
Explanations |
| Overtime Eligibility |
Every employee is eligible for overtime. One can get exemption from overtime if he or she :
- Belongs to any regulatory or supervisory positions.
- Carries out the responsibilities which explain the acquiring of the exemptions.
|
| Statutory Working Hours |
48 hours per week |
| Paid Public Holidays |
The paid public holidays in Mozambique for 2021 are as follows:
- New Year’s Day (1 January)
- Mozambique Heroes’ Day(3 February)
- Public Sector Holiday (2 April)
- Mozambique’s Women’s Day
- Workers’ Day
- Independence Day
- Lusaka Peace Agreement Day
- Armed Forces Day
- Peace and National Reconciliation Day
- Maputo Day
- Family Day / Christmas Day
|
| Holiday Pay |
In the beginning, employees should be given one day of leave per month, which increases gradually every year. |
| Medical Leave |
Usually, employees are allowed to take 15 days of medical leave consecutively & 5 days per quarter non-consecutively. Under Mozambique’s social security system, employees are eligible to enjoy the benefits. |
| Maternity/Paternity Leave |
Women employees are allowed to take 60 days of paid maternity leave. They are also eligible to take 30 days of maternity leave per year for personal reasons such as if a child is admitted to the hospital.
Male employees are generally eligible to take one day of paid paternity leave that is usually taken right after the birth of the baby.
|
| Annual Leave Accrual Entitlement |
This is solely formulated on the agreement between the employer and employees and the timespan of the employee’s service:
- In the first year, employees are entitled to receive one day of vacation per month.
- In the second year, employees are entitled to receive two days of vacation per month.
- After the third year, employees are entitled to receive 30 days of vacation per year.
|
| Accrued Leave At Termination |
An employment contract may be terminated because of the following reasons:
- Completion of work
- Death of the employee
- To maintain competitiveness
It can be terminated without any cause as well but they must give prior notice to the employer in a written document.
|
| Employee Protection and Anti-discrimination Rights |
One can be terminated if they are involved in any wrong means under the Labor Law. |
Contractors vs Full-Time Employees
All the employee contracts are made in written documents but only to those who have a timespan of more than 90 days. The agreement should be signed by both employer and employees and it should hold the following provision:
- Testimony & recognition of both the parties.
- Executive jobs or schemes agreed.
- Place of work
- Timespan of the agreement
- Renewal of the agreement
- Size, configuration & recurrence of wages (pay scale)
- Benefits
- Starting date of the implementation of the employment contract
- Expiring date of the employment contract
There are 3 types of contracts under Mozambican Labor Law:
- Permanent employment contract
- Fixed-term employment contract (2 years)
- Unfixed-term employment contract (Unable to predict with the date of expiration)
Hiring in Mozambique
At first, the people who are looking for jobs have to apply for the best-suited job. Then, they need to ace two interview rounds and an assessment test. After this, the selection panel gives the position or job to the most deserving candidate. Skuad can help employers to hire and onboard employees (both full-time and contractual). Learn more.
Probation & Termination
Probation Period
The supervisory positions have a maximum probationary period of 180 days while other employees have a probationary period of 90 days.
Termination Of Service
| Topics |
Explanation |
| Notice For Termination Of Employment |
An employee can terminate the employment contract but he/she needs to give prior notice to the employer in a written document. In that document, they must mention the specific date of termination.
An employer can terminate but he/she must provide prior notice 30 days before the date of termination & the employee is eligible to receive compensation in this case.
|
EOR Solution In Mozambique
Mozambique Employer of Record (Mozambique EOR) solutions make it easier and faster for businesses to expand into Mozambique. Taking the EOR route ensures smooth and compliant processing of payroll and other employment responsibilities, without any entity establishment. Skuad can help you manage monthly payroll, contracts, work permits, taxation, etc. in Mozambique for your employees.
General Employer of Record Service Terms
| Taxes that apply to invoices |
17% GST |
| Minimum duration of service |
3 months ( 90 days ) |
| Currency Accepted |
MZN/ USD/ ZAR |
| Required Details & Documents |
For Mozambican Citizens: Personal information, Copy of passport, Bank details, Copy of NRIC (for permanent residents), Job description.
For Expatriates: Personal information, Job description, Educational qualifications, Technical qualifications, CV, Copy of passport, Copy of ID, Bank details, Photographs, Police verification, Medical exam results.
|
Outsourcing Employment Through An Employer of Record
When as an organization you decide to expand into Mozambique, you also need to decide the route you want to take. Whether you want to build an in-house team or take the services of an EOR to manage payroll and employee lifecycle.
Types of Visas in Mozambique
| Visa Category |
Explanation |
| Diplomatic Visa |
It is permitted to the candidates who travel to the country for conciliatory reasons. Its processing takes six days for normal visas & 1-2 days for urgent visas. It has a validity of a minimum of 1 month and a maximum of 3 months. |
| Business Visa |
It is permitted to the candidates who travel to the country for business purposes. Its processing takes two to five days and it has a validity of 2 months. |
| Tourist Visa |
It is allowed to the candidates who travel to the country for touristic reasons. Its processing takes ten to fifteen days and it has a validity of 30 days. |
| Courtesy Visa |
It is conceded to the candidates who are welcomed by the Mozambican specialists. Its processing takes ten to fifteen days and it has a validity of a minimum of 1 month and a maximum of 3 months. |
| Work Visa |
It is made eligible to the candidates who travel to the country for work reasons. Its processing takes ten to fifteen days and it has a validity of 30 days which can be extended upto 60 days. |
| Visit Visa |
It is granted to candidates who travel to the country to visit family or companions. Its processing takes ten to fifteen days and it has a validity of 180 days. |
| Official Visa |
It is allowed to the candidates who travel to the country for official reasons. Its processing takes ten to fifteen days and it has a validity of 6 months. |
| Residence Visa |
It is granted to candidates who travel to the country for permanent residence. Its processing takes ten to fifteen days and it has a validity of 1 year. |
| Student Visa |
It is allowed to candidates who travel to the country for scholarly reasons. Its processing takes ten to fifteen days and it has a validity of 1 year. |
Work Permit
Skuad’s local partner in Mozambique can sponsor foreign workers for work permits. As an EOR in Mozambique, Skuad takes care of all the requirements and responsibilities related to employment. On Skuad’s HR platform, the client company can manage their employees’ daily activities and operations. Talk to us.
| Work Permits |
|
| Can Skuad Sponsor Work Permit in Mozambique |
Yes |
| Processing time |
2 weeks |
| Work Permit Process |
Step 1: Skuad’s local partner in Mozambique applies for the Employment Pass.
Step 2: Ministry of Manpower gives an in-principle approval (IPA) letter.
Step 3: The worker enters Mozambique with the IPA letter.
Step 4: The worker is provided with a letter that permits them to start work and travel in Mozambique.
Step 5: The employee submits his biometrics at the Employment Pass Services Centre.
Step 6: The employee gets his pass card.
|
| Passport submission |
The employee's original passport is presented during their appointment. It must have a validity of 6 months. |
| Work Permit Validity |
The validity of a work permit in Mozambique is 4 years. |
| Work Permit Process for Different Countries |
For most countries, the process to obtain a work permit is the same. However, there are some exceptions for citizens of some countries like China. |
| Change of Sponsor Within Mozambique |
The employee needs to submit a new application for a change of sponsor. |
| Where is the application processed? |
The application might be prepared in Mozambique or the worker's nation of origin. |
| Work Permit Restrictions |
To obtain a work permit in Mozambique, the applicant must meet certain criteria. The applicant must have:
- Two application forms of work permit.
- A passport copy of the candidate.
- Three employment contract copies.
- A guaranteed record posting the organization's workers for the earlier year, which ought to demonstrate the total number of representatives and their pay rates and positions.
|
| When Can Employee Travel to Mozambique |
An employee can travel to Mozambique once he gets the approval of the work permit and the residence permit. |
| What is the cost of a business visa? |
It starts from $89 and can reach upto $379. |
| Duration of business visa processing |
2-5 days. |
| Switch Business Visa to Work Permit? |
No |
| Can spouses work on dependent visas? |
The spouse of the employee, who has obtained the work permit, cannot work on a dependent's visa. They need to apply for a spousal visa or family visa for it. |
| Termination of Work Permit |
A notice period is required for cancellation. One can not work in Mozambique once their work permit is terminated or canceled. |
| Special Requirements for Work Permit Cancellation |
The work permit must be canceled by the employer or appointed employment agent. |
Things You Must Know To Set Up Payroll In Mozambique
To set up Mozambique Payroll, one has to subsume in the country. Every organization’s method to set up a subsidiary is different based on the type of organization they choose. It can take weeks or months before you can legally work in the country. So, it pays off to utilize Skuad’s EOR solution.
Before you set up your Mozambique payroll, you will not need to hold on to fuse when you work with us. Our Mozambique payroll subcontracting administrations will guarantee that your payroll is consistent, and you can commence working in a couple of days rather than a couple of months. Learn more.
Taxes in Mozambique
| Tax |
Explanation |
| Income Tax Rates |
Monthly Taxable Income
| Grossed Income |
Tax Rate (%) |
| 0 - MZN 42,000 |
10 |
| MZN 42,001 - 168,000 |
15 |
| MZN 168,001 - 504,000 |
20 |
| MZN 504,001 - 1,512,000 |
25 |
| Above MZN 1,512,001 |
32 |
|
| Corporate Income Tax Rate |
32% |
| Payroll Tax |
There are no payroll taxes. |
| Tax Returns |
Tax returns are recorded on a family as opposed to a different premise. |
| Withholding Tax (For Both Residents & Non-Residents) |
- Dividends: 20%
- Royalties: 20%
- Interest: 20% / 0%
- Technical Services: 20%
|
| Sales Tax |
17% VAT is levied on the supply of goods and services. Services that are exempted from GST include exports, financial services, sale or rental of residential properties, import and supply of precious metals. |
| Employers Social Security |
Employers are needed to contribute 4% of the employer's monthly gross compensation. |
| Employees Social Security |
Employees are needed to contribute 3% of the employee’s monthly gross compensation. |
| Reimbursements |
To claim the expense reimbursements, the employees must present a scanned copy of the receipts. |
| Public Pension |
Mozambican citizens and permanent residents are entitled to public pension in two ways: old-age pension and early pension |
| Medical Insurance |
Medical insurance is not mandatory for the citizens of Mozambique. |
Incorporation: How to Set Up A Subsidiary In Mozambique
We suggest seeing two components before setting up your Mozambique subsidiary— area and construction. Various urban areas and regions can work under isolated subsume rules, expenses, and accessibility. You should explore the region where you need to join before picking an actual office space or work with an advisor who can help you pick. Mozambique recommends a few sorts of designs for organizations hoping to extend in the country. Every organization accompanies its own Mozambique subsidiary laws and advantages, so it's imperative to audit your business objectives and organizational structure to settle on the right choice.
The set up of a Mozambique subsidiary requires the following steps:
- Acquiring an authentication of your name at the Legal Entities Registrar.
- One should sign the Articles of Association before a public accountant.
- Proof of an operating license.
- Announcement of the commencement of your business activity at the tax department.
- A provisional bank account must be opened.
- All your employees must be registered with the social security system.
Skuad can simplify the process since it can become the local partner.
Professional Employer Organization (PEO)
A professional employer organization (PEO) is a firm that offers types of assistance to little and medium-sized organizations (SMBs). An organization can utilize a professional employer organization for its entire workforce. A PEO also works as the co-employer of the entity. A PEO does the work of an HR such as taking the duties & liabilities of an organization and his other functions. It gives services of 5-10 employees.
In an organization, the EOR works as a legal employer and predicts the responsibilities and liabilities of that organization. It does the work of an HR partially. It gives services of 1-5 employees. You can pick a PEO or an EOR, contingent upon your necessities and prerequisites. Comprehend your prerequisites completely and settle on the right decision to profit from their administrations. Book a demo to know which Skuad service will best suit your needs.
Conclusion
Do you think you are ready to expand your company’s business operations in Mozambique? Skuad’s Employer of Record Togo services can make the process fast and easy by handling your HR requirements in compliance with the local labor laws. If you want to discuss how Skuad’s payroll management services can help you, please get in touch with us today!
FAQs
1) What is an employer of record in Mozambique?
An EOR in Mozambique allows foreign businesses to hire employees without creating a local entity. The EOR handles payroll, tax compliance, and employment contracts, ensuring adherence to Mozambique's labor laws.
2) What is the employer of record in Africa?
An EOR in Africa, including Mozambique, allows businesses to hire employees across multiple countries without setting up local entities. The EOR ensures compliance with local labor laws and manages payroll and taxes.
3) What is the difference between employer of record and PEO?
An EOR takes full legal responsibility for employees, while a PEO operates through co-employment, sharing responsibilities with the client. An EOR is better suited for companies without a legal presence, whereas a PEO requires one.
4) What is the difference between employer of record and a staffing agency?
An EOR acts as the legal employer, handling long-term employment responsibilities. A staffing agency typically provides temporary workers and does not assume full legal responsibility for the employees.
5) What are the benefits of EOR?
Using an EOR in Mozambique helps foreign companies stay compliant with local laws, manage payroll, and hire employees without establishing a legal entity, reducing administrative and legal risks.
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