Mozambique EOR & PEO

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Hire in Mozambique

Mozambique is a large country located on the southwest coast of the African continent. Bordered by Tanzania, Malawi, Zambia, Zimbabwe, Eswatini, and South Africa, the nation has a complex history. It has had lots of Arab contact and was a Portuguese colony until it gained independence in 1975. However, civil war and natural disasters slowed the development of the nation of over 34.858 million people.

In the 2000s, Mozambique’s economy grew steadily, tripling in value by 2014. While it hit a downturn in the years following, growth began again in 2020, and Mozambique’s GDP reached over $21 billion, which is expected to increase by 5.0% in 2024. Inflation has come under control and is predicted at 4.4% this year. If you’re thinking of hiring Mozambican workers, now might be the right time, and an EOR can help make this a reality.

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hire employees in Mozambique

What Is a Mozambique EOR?

An employer of record or EOR in Mozambique is a service provider that works in that country to help other companies hire and manage local workers. EORs typically work with client companies that don’t own business entities in Mozambique by hiring workers on their behalf. They also provide a full complement of services, including recruiting, hiring, contract preparation, payroll management, benefits administration, leave scheduling, and more. Their clients pay them regular fees to manage employees long-term. An EOR is sometimes also known as a PEO or professional employment organization.

Save Money And Time with A Mozambique EOR

What Are the Benefits of a Mozambique EOR?

Mozambique EORs can be a big help when you want to hire workers in Mozambique. Among the advantages your firm can gain by working with an EOR are:

Not needing an entity. If you want to hire employees in Mozambique, you normally have to register a legal business entity first. This can take time and money that might be better allocated elsewhere. However, an EOR can hire these workers on your company’s behalf, so you don’t need to waste resources on setting up an entity.
Language skills. The official language of Mozambique, used in education, government, and business, is Portuguese. However, Mozambicans speak over 50 local, mostly Bantu languages including Tsonga, Makhuwa, Sena, and Swahili. Most educated Mozambicans also speak English. These extensive language skills can be a big plus for employers when doing business in the region and across international borders.
Fast recruitment and onboarding. A Mozambique EOR will normally have its own networks and labor pool to recruit candidates from. It will also be familiar with the best job sites and other effective ways to attract top talent in Mozambique. This allows an EOR to fill positions in a matter of days to a few weeks, while it might take a foreign-based company months to find similar talent independently.
Affordability. Mozambique is a low-income country. Therefore, wages here are relatively low, and employer contributions are very low. This makes hiring Mozambican employees very affordable for foreign-based firms.
Constant compliance. When you work with an EOR in Mozambique, the EOR becomes the sole legal employer of your workers. For this reason, it also becomes responsible for compliance with all tax and labor laws that relate to the treatment of those workers. It, therefore, has to work to ensure that this treatment is fair, equitable, and in line with all legal statutes.

Horizons is Best IN Class

Why Choose Horizons?

Horizons stands out as a Mozambique EOR through:

A strong regional presence in Africa, meaning senior management are on the ground to deal with any issues.
Client-focused infrastructure. Horizons won’t oversell you on products and services you don’t need. Horizons offers the easiest platform to compliantly hire and pay people worldwide.
Cost-effective solutions. At $299 per employee, per month, no EOR in Mozambique is more affordable. The cost is 100% transparent (onboarding, offboarding, deposit, no extra charges).
A customer-first culture. Horizons is an efficient bootstrapped company. It is not an externally-funded company burning investor cash to aggressively acquire new clients. Horizons is the only EOR that grows with its customer, reflecting the level of care and personal attention provided to each customer. Horizons will carefully advise on the best setup in each country: the type of contract needed, how to structure your benefits, and how to offboard a person while minimizing the risk of conflicts and extra cost
A long-term partnership. Horizons is the only EOR platform with a recruitment arm — a direct response to client demand. If any employee is leaving, or if our clients want to explore a new country, Horizons can recruit new candidates directly for the client. Horizons is:
- The only EOR doing this in-house — no subcontracting
- The only EOR doing this without a retainer — clients are only charged upon success
- The only EOR charging just a 2% fee per month.

Step-by-step Mozambique EOR

How Does a Mozambique EOR Work?

A Mozambique EOR connects local employees with foreign-based client companies that want to hire them. In this three-way relationship, the EOR typically offers these services:

Hiring your employees. The EOR will work closely with your company to find out your recruitment needs. After defining the roles needed and the requirements you have for them, the EOR will actively recruit for these positions. It will dip into its talent pools and networks and advertise on your behalf to find the most suitable candidates it can for your openings. If your company accepts the candidates it puts forth, the EOR will then sign contracts with these employees. It will become their sole legal employer while contracting them to work directly for your company.
Managing employment contracts and onboarding. Candidates that you accept can take job offers or negotiate terms directly with your company. The EOR will advise you on compensation that’s fair and appropriate and also ensure that contracts are full and legal. When it’s time to hire, the EOR will sign contracts with the employees that include these negotiated terms. It will then collect their personal and banking information, sign them up for tax and social security programs, and prepare them to start working for your company.
Processing payroll and handling employment taxes. An EOR will typically handle payroll functions for your Mozambican workers for every pay period. Your company will make payments to the EOR to cover salaries and contributions regularly. Based on the worked-hours data you also provide, the EOR will calculate each employee’s gross salary and then figure out deductions for social contributions. Mozambican workers must also be deducted between 10% and 32% of their gross salaries for income tax, depending on their income levels. The remainder, the employees’ net salaries, will then be dispersed to them by the EOR.
Administering benefits. You may offer additional benefits to your Mozambican workers as part of their compensation packages. These benefits may include things like life insurance, medical insurance, disability insurance, or private pensions. The EOR can search for appropriate plans for your workers and sign them up, then manage regular contributions to these plans from both your company and the workers’ salaries.
Taking care of exit procedures. Whether your workers come to the end of their fixed-term contracts or need to be terminated for economic or individual reasons, the EOR can handle this function for you. It will calculate notice periods and severance payments in accordance with Mozambique’s labor statutes and administer them as needed.

stay compliant with Mozambique labor laws

Labor Laws

Mozambique has fairly extensive laws overseeing employment and the protection of workers’ rights. At the same time, these laws are written in Portuguese and are spread over various instruments such as the Constitution, Labor Law of 2007, other orders and decrees, International Labor Organization treaties Mozambique has ratified, and other statutes. This can make managing compliance quite difficult and better left to an EOR to manage. It’s useful, however, for employers to know some of the basic provisions of these laws so that they know what Mozambican employees expect and are entitled to.

Employment contract types

Contracts must be written unless they are for fewer than 90 days of work. These contracts should normally be permanent. Fixed-term contracts can be given but should only be for non-durable work. All legal contracts must include the identities of the employer and employee, job title and description, workplace, contract duration, renewal details, salary and payment interval, and start date of the work. Fixed-term contracts must also include the contract term, justification for a fixed term, and termination date. Fixed-term contracts are normally limited to two years and may only be renewed twice. However, Labor Law No. 13/2023 has recently allowed new companies with up to 100 workers unlimited use of fixed-term contracts during their first eight years of operation.

Project-based

Fixed-term

Indefinite

Working hours in Mozambique

Mozambican workers normally work eight hours a day, six days a week, for a total of 48 regular hours per week. Their hours can be increased to nine hours/day for five days if they get an extra half-day of rest per week. Overtime is possible, but they cannot work more than 56 hours a week. Overtime may not exceed 96 hours per quarter or 200 hours per year.

Overtime must be compensated in the following way:

Holiday Schedule in Mozambique [2024]

There are 9 paid public holidays in Mozambique. Employees are entitled to these days off with pay. If they work, they must be paid 200% of their normal wages.

Date	Holiday name
1 Jan, 2024	New Year’s Day
3 Feb, 2024	Mozambican Heroes Day
7 Apr, 2024	Mozambican Woman’s Day
1 May, 2024	May Day
25 Jun, 2024	Independence Day
7 Sep, 2024	Victory Day
25 Sep, 2024	Armed Forces Day
4 Oct, 2024	Peace and Reconciliation Day
25 Dec, 2024	Family Day

Paid time off

Workers are entitled to at least one rest period of 24 hours per week.

Sick leave in Mozambique

Absence due to sickness is considered justified in Mozambique. Employees are paid 70% of their normal salary for a period of up to six months through social insurance. This payment starts, however, after the first three days which are unpaid.

Less than 6 months of sick leave:

(percentage of regular wages owed to the employee)

Over 6 months of sick leave

In order for employees to receive the full wages due to them, workers must present a valid medical certificate from a certified doctor to their employer.

Maternity leave in Mozambique

Expecting mothers are entitled to 60 days of maternity leave paid by social insurance and another 30 days of unpaid leave if desired.

Fathers can avail themselves of seven paid days of paternity leave within a 24-month period. If the mother dies or is disabled, however, paternity leave can be extended to 60 days.

Annual leave in Mozambique

Mozambican employees who work for an employer for one year are entitled to 12 days of paid leave. In subsequent years, annual leave is increased to 30 calendar days per year.

Termination & severance in Mozambique

Mozambican workers must be provided with justification for termination. In case of gross negligence or misconduct, an employee may be dismissed immediately. In all other cases, 30 days’ notice in writing must be given. Severance is paid according to seniority and salary as follows:

30 days’ wages for every year of service if the worker’s salary is 1-7X the minimum wage
15 days’ wages for every year of service if the worker’s salary is 8-10X the minimum wage
10 days’ wages for every year of service if the worker’s salary is 11-16X the minimum wage
3 days’ wages for every year of service if the worker’s salary is more than 16X the minimum wage

Mozambique's compulsory social security contributions

Social security contributions are mandated by law and cover various social security benefits such as pensions, disability benefits, and healthcare. These contributions are typically shared between employers and employees and paid through the National Institute of Social Security (INSS).

Mozambique social security for foreigners

Foreign workers are also typically required to contribute to the social security system unless exempted under specific bilateral or multilateral agreements.

Individual income tax

Individual income tax is levied on the income of residents and non-residents who earn income within the country. The income tax system is progressive, meaning that higher income levels are taxed at higher rates.

Health insurance

In Mozambique, while the public healthcare system provides a foundation of health services, access to quality healthcare can be challenging due to resource limitations. Private health insurance and employer-sponsored plans offer more comprehensive and higher-quality healthcare options, especially for those who can afford them.

hassle-free Mozambican compensation & benefits

Compensation & Benefits

Mozambique compensation laws

Unlike in many other countries, the minimum wage in Mozambique is set according to the worker’s industrial sector.

Overtime must be paid at the rate of 150% of normal wages until 8:00 p.m. Any hours performed between that time and the start of the employee’s regular working hours must be paid at 200% of normal wages.

13 month salary in Mozambique

A 13th-month annual bonus is mandatory in Mozambique. However, the government may restrict the size of this bonus as it did in 2023, limiting it to 30% of a worker’s normal monthly salary to help employers.

Social security for Mozambican nationals

Employees are deducted 3% of their salaries to contribute to Social Security. Employers pay another 4% of the value of the employee’s gross salary. These contributions go towards old age, disability, survivors, and death benefits.

Mozambique Employer Of Record Peo

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Hire in Mozambique

What Is a Mozambique EOR?

What Are the Benefits of a Mozambique EOR?

Why Choose Horizons?

How Does a Mozambique EOR Work?

Labor Laws

Employment contract types

Working hours in Mozambique

Compensation & Benefits

Frequently asked questions

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Frequently asked questions

What are the common challenges of using an EOR in Mozambique?

For some companies, using an EOR can limit their direct control over their workers. EORs also often use different human resources information systems to manage workers and different payroll software to pay them compared to their client companies. This can make data exchange more difficult, especially if these systems cannot be harmonized.

How does an EOR in Mozambique manage employee terminations?

If an employee needs to be terminated, the EOR is legally responsible for making this happen. It will serve workers with 30 days’ notice and the reason for the termination, except in the case of gross negligence, in which case no notice is required. The EOR will also calculate severance pay based on the employee’s average salary and pay it if necessary. If a fixed-term contract is terminated, the EOR will have to help the employer pay the employee’s wages until the end date of the contract.

Mozambique EOR & PEO

Start hiring in Mozambique

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Hire in Mozambique

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hire employees in Mozambique

What Is a Mozambique EOR?

Save Money And Time with A Mozambique EOR

What Are the Benefits of a Mozambique EOR?

Horizons is Best IN Class

Why Choose Horizons?

Step-by-step Mozambique EOR

How Does a Mozambique EOR Work?

stay compliant with Mozambique labor laws

Labor Laws

Employment contract types

Project-based

Probationary period

Termination

Severance

Fixed-term

Probationary period

Termination notice period

Severance

Indefinite

Probationary period

Termination notice period

Severance

Working hours in Mozambique

Overtime must be compensated in the following way:

For a regular workday:

For a rest day:

For a statutory holiday:

Paid time off

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Sick leave in Mozambique

Less than 6 months of sick leave:

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Over 6 months of sick leave

Under 1 year of employment

1-3 years of employment

3+ years of employment

Maternity leave in Mozambique

Annual leave in Mozambique

Termination & severance in Mozambique

Mozambique's compulsory social security contributions

Mozambique social security for foreigners

Individual income tax

Health insurance

hassle-free Mozambican compensation & benefits

Compensation & Benefits

Mozambique compensation laws

13 month salary in Mozambique

Social security for Mozambican nationals

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