Hire Contractors in Morocco

Several global companies in the MENA (Middle East and North Africa) region see Morocco as a promising destination for business expansion. 

The country offers a range of unique advantages, including a growing economy and a flexible labor market. 

With nearly half the workforce in Morocco being self-employed, hiring contractors can save upfront costs for your expansion in the region. 

By understanding the nuances of the Moroccan business environment, you can effectively leverage contractor talent to achieve your project goals. 

This guide will delve into the key factors concerning contractor onboarding and provide insights into the legal framework and best practices to follow in Morocco.

How to Hire Contractors in Morocco

A sole proprietorship is the default business model for independent contractors, and you can hire them in the following way: 

• Establish a legal entity in Morocco in any one of the following structures: 
  • Limited liability companies
  • Private limited companies
  • Limited partnerships with shares
  • General and limited partnerships
  • Joint-ventures 

• Explore professional networking groups, online platforms, and local job boards to find suitable candidates.
• Draft a comprehensive service agreement outlining the terms and conditions, payment terms, intellectual property rights, and dispute resolution mechanisms.

Alternatively, there is another way to hire contractors in Morocco without much legal hassle.

That is by hiring independent contractors through an AOR.

Hiring contractors in Morocco via a contractor management platform, like Skuad, takes the administrative burden off of your shoulders.

With a contractor management software, you can:

• You can hire and onboard independent contractors
• Automate contractor lifecycle management
• Ensure compliance with local laws
• Pay contractors in multiple currencies

Hiring contractors through Skuad AOR

Skuad is an Agent of Record (AOR) platform that simplifies hiring contractors in Morocco and globally by eliminating the need to establish a legal entity. 

• Skuad manages payments for your contractors in the currency of their choice and provides payslips for your remote team. All this with $0 onboarding fees. 
• As the agent of record, Skuad manages taxes, and any applicable benefits, adhering to Moroccan laws. 
• Skuad helps protect your intellectual property by ensuring proper contractual agreements and data security measures with independent contractors.

How to pay contractors in Morocco

Independent contractors may set their rates and be responsible for their taxes. 

Unlike employee salaries, contractor payments do not involve tax deductions or social security contributions. 

However, you must make timely payments based on the invoice for services rendered, with payment terms agreed upon in the contract. 

These terms can range from upfront payments to final payments upon project completion. 

While companies use direct bank transfer or payment wallets like Paypal, you can automate contractor payment with Skuad payroll services to simplify contractor management. 

You can pay in local currency (100+ currencies), track invoices, and more. 

Challenges of Hiring Contractors in Morocco

Hiring contractors in Morocco presents the following challenges for businesses:

1) Demand surpasses the supply of contractor 

• A smaller pool of potential employees can lead to a shortage of skilled individuals who might otherwise consider freelance work.
• With a low labor force participation rate of 46.7% and fewer skilled workers available, competition for Morocco contractors can be intense, driving up rates and making it challenging to find the right fit.
• Due to the challenges in finding employees, there might be a higher risk of businesses misclassifying contractors as employees to avoid the complex hiring process.

2) Hiring ex-pats as Morocco contractors

• If a contractor's services necessitate their physical presence in Morocco, they will likely require a work permit, which can be time-consuming and complex.
• Moreover, proving the unavailability of qualified Morocco contractors for a specific role can be a bureaucratic hurdle.
• To affirm this, you need to produce a certificate from the ANAPEC (National Agency for the Development of Employment and Skills). 

Thankfully, Moroccan laws allow you to use contractor management software like Skuad AOR for legal compliance during onboarding, generating pay stubs of independent contractors, and more.

Hiring Contractors Directly vs Hiring Contractors via Skuad

The table summarizes the benefits of hiring contractors via Skuad compared to hiring contractors directly. 

You can avoid misclassification risks and make hiring contractors in Morocco more affordable by following this easy checklist.

Cost of Hiring Contractors in Morocco

Morocco laws prescribe a national minimum wage for full-time employees: about 2,970 MAD (USD 297) monthly. You can benchmark contractor pay above the minimum wage, varying it per the project scope and market standards. 

According to wage reports of Moroccan contractors, the annual salary range is MAD 166,201 and MAD 296,060. Moreover, the cost of hiring contractors will also depend on your business structure in Morocco. 

Partnering with a contractor management company lets you save onboarding costs and pay contractors in Morocco in any currency at a currency conversion cost.

How to Convert a Contractor into an Employee in Morocco

Morocco may not have a detailed procedure for switching contractors into an employee as in the US. 

But there are two ways to convert an independent contractor into an employee and exert a greater degree of control over the work schedule: 

• Through a local entity
• Through an employer of record (EOR)

Begin with drafting a formal employer-employee relationship within your existing Moroccan entity. It requires adherence to Moroccan labor laws, including providing statutory benefits, social security contributions, and complying with work-hour regulations. 

However, you can skip the administrative hindrance and compliance requirements and focus on your contractor team. 

Your EOR solution partner will onboard and manage employment contracts, payroll & tax deductions, benefits administration, payroll, and termination proceedings per the Moroccan labor laws.

Hire Contractors in Morocco with Skuad

Expand your team seamlessly across Morocco with Skuad. 

Whether you need talent in Fes, Casablanca, Marrakesh, or beyond, our platform simplifies the process of hiring, onboarding, and managing independent contractors. 

Skuad offers expert contractor management in Morocco and over 160 other countries. With deep local knowledge, Skuad ensures compliance with local laws, handling payroll, tax compliance, and benefits. 

Trust Skuad to simplify your contractor management, allowing you to focus on business growth.

‍Get started with a demo today!

FAQs

1) Can I hire an independent contractor in Morocco?

Yes, you can hire contractors in Morocco to fulfill specific project needs. Unlike employees, contractors are self-employed individuals responsible for their taxes and benefits. It's essential to draft clear contracts to define the scope of work, payment terms, and intellectual property rights.

2) How do I pay an independent contractor in Morocco?

You can issue payments based on the pre-defined terms outlined in the contract. This usually involves transferring funds directly to the contractor's bank account or through a digital wallet. An alternative way to pay Morocco contractors is through Skuad payroll services, which can automate payment schedules and generate pay stubs. 

3) How does Skuad help hire, pay, and manage independent contractors in Morocco?

Skuad is your Agent of Record to guide you through onboarding, paying, and managing independent contractors in Morocco. Skuad AOR handles the complexities of employment, including contract management, payroll, benefits, IP protection, and compliance. This allows businesses to focus on their core operations while Skuad ensures adherence to local labor laws. 

4) Do I have to issue a 1099 to foreign contractors?

No, you generally do not have to issue a 1099 to foreign contractors. A 1099 form is a U.S. tax form used to report payments made to independent contractors by employers registered in the USA.

5) What is the difference between an independent contractor and an employee in Morocco?

In most countries, including Morocco, independent contractors are differentiated from employees based on zero employer control over work schedules and fulfilling contractual obligations on a project basis. Independent self-employed contractors typically invoice for their services and are responsible for their taxes and benefits.