Ethiopia EOR & PEO

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Hire in Ethiopia

Horizons provides global employment solutions allowing any business to easily hire employees in Ethiopia — in full compliance with local laws and regulations. The Horizons Ethiopia EOR solution means you can do hire employees in Ethiopia without the need to set up a local subsidiary or entity.

This saves businesses time and money, and reduces or eliminates the risk of non-compliance.

Note, a Ethiopia Employer of Record is also known as a Ethiopia Professional Employer Organization (PEO).

Facts & Stats

stay compliant with Ethiopia labor laws

What is an Ethiopia EOR?

While it is technically possible to enter into a verbal contract in Algeria, we strongly recommend producing a formal written employment contract when hiring your workforce. The local language of Arabic should be used, and any references to money should be in the Algerian dinar. The contracts should include any relevant details of the employment agreement, such as compensation, vacation allowance, and more.

By partnering with our Algeria EOR, Horizons’ team of local experts can provide assistance for drafting strong employment contracts that are compliant with local regulations.

What are the benefits of engaging an Ethiopia EOR?

There are several benefits of using an EOR in Ethiopia. One benefit is the cost savings that an EOR can provide: By outsourcing HR tasks to an EOR, a client company can avoid the expenses associated with hiring and training in-house HR staff.

In addition, an EOR can often negotiate better rates for benefits such as health insurance and retirement plans, which can save the client company money.

Another benefit of using an EOR is the expertise and resources that it can offer. An EOR typically has a team of HR professionals who are knowledgeable about employment laws and regulations in Ethiopia. This can help the client company to stay compliant and avoid costly legal issues. An EOR also has access to a range of HR tools and technologies that can help the client to more effectively manage its workforce.

Using an EOR can also help a client company to be more agile and flexible. By outsourcing HR tasks to an EOR, the client can focus on its core business activities and be better positioned to respond to changing market conditions.

How does an Ethiopia EOR help businesses hire employees?

In Ethiopia, an EOR can assist client companies with the hiring process in a variety of ways. One way is by handling the administrative tasks associated with hiring, such as posting job advertisements, reviewing resumes, and scheduling interviews. An EOR can also help a client company to create job descriptions and offer letters, and to conduct background checks and reference checks on potential hires.

In addition, an EOR can provide guidance to a client company on employment laws and regulations in Ethiopia, including those related to hiring. This can help the client company to ensure that it is complying with all relevant laws and to avoid potential legal issues.

Finally, an EOR can provide training and support to a client company on effective hiring practices, such as how to conduct interviews and assess candidates. This can help the client company to make informed hiring decisions and to build a strong and productive workforce.

Specifically, an Ethiopia EOR can help ensure compliance with the following legal requirements:

Ethiopia national holidays 2023

An Ethiopia EOR can help you manage benefits in Ethiopia by managing all benefits for your Ethiopia staff. This includes leave management, healthcare, and pensions.When it comes to annual leave/vacation leave, employees in Ethiopia received 16 days paid annual leave. In addition to an are several mandatory public holidays in Ethiopia. Some of the most notable ones include:

Holiday Schedule in Ethiopia [2024]

Ethiopia has a range of national public holidays that are celebrated annually. In 2024 these holidays are:

Date	Holiday name
1 Jan, 2024	New Year’s Day
7 Jan, 2024	Orthodox Christmas
20 Jan, 2024	Epiphany
29 Mar, 2024	Good Friday
31 Mar, 2024	Easter Sunday
10 Apr, 2024	Eid al-Fitr (tentative)
1 May, 2024	Labor Day
5 May, 2024	Patriots’ Victory Day
28 May, 2024	Derg Downfall Day
16 Jun, 2024	Eid al-Adha (tentative)
11 Sep, 2024	Islamic New Year
16 Sep, 2024	Prophet’s Birthday (tentative)
27 Sep, 2024	Meskel

In addition to these holidays, there are also several other holidays that are observed by certain groups or in certain regions of Ethiopia. For example, some areas observe the Islamic holiday of Eid al-Fitr, while others observe the Orthodox Christian holiday of Timkat.

It is important to note that while these holidays are mandatory, the actual dates on which they are observed may vary depending on the lunar calendar used in Ethiopia.

Paternity and Maternity leave in Ethiopia

In Ethiopia, the maternity leave requirements are established by the Labor Proclamation No. 377/2003. According to this law, female employees are entitled to a total of 120 days of maternity leave. This covers 30 days before birth and 90 days after. During this time, the employee is entitled to receive her full pay and other benefits. Male employees are entitled to three consecutive days of paid parental leave. Civil servants get five days.

Employer pension contributions in Ethiopia

Under the Private Organization Employees’ Pension Proclamation (Proclamation No. 1268/2022) employers in Ethiopia are required to make contributions on behalf of their employees into a nationally-administered pension scheme.

Currently, employers are required to contribute 11 percent of an employee’s basic salary, while the employee must contribute 7 percent.

Evidence of compliant payment of these contributions is essential for a business in Ethiopia to maintain and have its business licences renewed.

Income tax withholding in Ethiopia

In Ethiopia, employers are required to withhold income tax from the salaries of their employees and remit the withheld tax to the government on behalf of their employees. The income tax rates in Ethiopia are progressive, with higher rates applied to higher levels of income. The current income tax rates in Ethiopia are as follows:

0% on the first 600 birr of taxable income
10% on the next 1,050 birr of taxable income
15% on the next 1, 549 birr of taxable income
20% on the next 2,049 birr of taxable income
25% on the next 2550 birr of taxable income
30% on the next 31,00 birr of taxable income
35% for all higher amounts.

Healthcare and health insurance in Ethiopia

In Ethiopia, employers are not required to provide health insurance for their employees. However, the Ethiopian Health Insurance Agency (EHIA) oversees two public insurance schemes:

Social Health Insurance (SHI) for public service employees, non-profits and private organizations
The Community-based Health Insurance (CBHI) scheme, mainly aimed at informal workers in the regions.

While the government in Ethiopia aims for universal coverage through these schemes, this has yet to be implemented.

Hire through an Ethiopia EOR

Ethiopia Employer of Record (EOR) solutions take the stress out of hiring employees in Ethiopia. By using an EOR, any company, anywhere in the world can hire quickly, cost-effectively and in full compliance with Ethiopia labor laws and regulations.

Ethiopia Employer Of Record Peo

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Hire in Ethiopia

What is an Ethiopia EOR?

Frequently asked questions

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Frequently asked questions

What is the difference between an Ethiopia PEO and an Ethiopia EOR?

Generally speaking, the terms “Ethiopia PEO” and “Ethiopia EOR” are used interchangeably.

What is the easiest way to hire employees in Ethiopia?

The easiest way for international companies to hire in Ethiopia is through an Ethiopia EOR. This ensures that employees are onboarded quickly, cost-effectively and in full compliance with Ethiopia’s labor laws.