EOR Service in South Africa

Hire, Onboard and Pay Employees in South Africa Quickly and Efficiently

Hiring in South Africa at a glance

CURRENCY
South African Rand (ZAR)
working hours
45 hours/ week
public/bank holidays
13 days
capital
Pretoria
language
Afrikaans, English, Xhosa, Zulu, Southern Sotho, Venda, Tswana, Northern Sotho, Tsonga, Swati, Ndebele
date format
DD/MM/YYYY
remote workers
1.2M
tax year
1 April - 31 March
minimum hourly salary
No minimum wage
CURRENCY
South African Rand (ZAR)
working hours
45 hours/ week
public/bank holidays
13 days
capital
Pretoria
language
Afrikaans, English, Xhosa, Zulu, Southern Sotho, Venda, Tswana, Northern Sotho, Tsonga, Swati, Ndebele
date format
DD/MM/YYYY
tax year
1 April - 31 March
payroll frequency
Monthly
GDP
$405.87B (2022)

Employer of Record in South Africa

For employers seeking to venture into South Africa's dynamic business landscape, understanding the intricacies of the country's payroll policies and procedures is paramount. South Africa, positioned as the 39th largest nation globally with a mixed economy, offers a diverse and skilled workforce. Its high GDP per capita underscores its status as one of the wealthiest African countries, with the financial sector playing a pivotal role, mainly centered in Johannesburg.


To tap into this potential for business success, employers need to be well-versed in South Africa's payroll requirements. Compliance with these regulations is essential for a smooth and legally sound operation. Navigating the nuances of payroll in South Africa is crucial for effectively managing a workforce and ensuring the success of business endeavors. This overview provides employers with insights into the economic landscape, emphasizing the importance of understanding and adhering to the payroll policies integral to establishing and sustaining a successful business in South Africa.


Why use South Africa EOR?

Opting for a South Africa Employer of Record (EOR) or Professional Employer Organization (PEO) is a smart move for employers entering the South African market. Navigating the country's intricate labor laws and ensuring compliance becomes more manageable with EOR/PEO services, minimizing legal risks. These services streamline payroll management, including tax regulations and social security contributions, ensuring accurate and timely payments. EOR/PEO providers facilitate swift market entry without establishing a separate legal entity, offering access to South Africa's skilled talent pool. Beyond simplifying administrative complexities, EOR/PEO services provide crucial support in areas like human resources, recruitment, and compliance, making them a comprehensive solution for a successful business entry in South Africa.


EOR Costs in South Africa

The expenses associated with EOR/PEO services in South Africa vary based on factors like the number of employees, the scope of required services, and project complexity. Typically, the pricing structure involves a monthly fee per employee or a percentage of their salary. Additional charges may apply for supplementary services or customization, providing businesses flexibility based on their specific needs. It's advisable for employers considering South Africa EOR/PEO services to discuss their requirements with service providers to determine a tailored cost structure aligned with their business objectives.

Key Metrics For Foreign Employers 

Here are a few factors for you to consider before considering hiring in South Africa.

Factors Global Ranking Interpretation
Rule of law 57 Indicates effectiveness of law enforcement
Labour-employer cooperation 124 Indicates positive labor-employee relationships
Reading Maths, and Science n/a Indicates average scores in OECD's survey of 15-year old students
University Ranking 42 Indicates average QS rankings
Labour productivity per employee 55 Indicates total output by the total labor input used to produce that output
Ease of finding skilled employees 115 Indicates findability of skilled talent
Workforce with tertiary education 85 Indicates % of workforce with PG degrees
Digital Skills 41 Indicates prevalence of advanced digital skills in the population

Source: The Global Talent Competitiveness Index 2023

Through the Gloroots’ Recrew platform, you can discover amazing talent in South Africa.


Why work in South Africa ?

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Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

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Grow your team in South Africa

Growing your team in South Africa requires strategic hiring aligned with business needs. Navigating local employment intricacies, including compliance, payroll, tax, and benefits, is seamless with Gloroots's Global Employer of Record (EOR) service. Entrust experts to handle administrative complexities, allowing you to focus on nurturing your team and fostering company growth in South Africa.

Risks of misclassification

Misclassifying employees in South Africa poses risks, potentially depriving them of legal protections. Engaging a PEO/EOR in the country mitigates these risks by ensuring compliance with labor laws, accurate classification, precise payroll management, and comprehensive benefits. This strategic approach lets businesses concentrate on core operations while entrusting employment responsibilities to seasoned experts.

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Employing in South Africa

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

Tax

Tax and Social Security contribution:

Employer

Payroll Tax Income Rate
Skills Development Levy (SDL) Maximum 212,544 ZAR 1.00%
Unemployment Insurance (UIF) Maximum 212,544 ZAR 1.00%
The Workers Compensation Fund (OID) in South Africa
operates with varying ratios, influenced by factors like workers'
earnings, job type, industry, and associated work risks.
For the 2023/24 period, the OID earnings limit is set at R568,959.
Variable
Total Employment Cost 2.00% and up

Employee

Payroll Tax Income Rate
Unemployment Insurance (UIF) Maximum 212,544 ZAR 1.00%
Total Employment Cost - 1.00%

Employee Income tax

Taxable Income Range (ZAR) Tax Rate
Up to 237,100 18%
237,101 – 370,500 26%
370,501 – 512,800 31%
512,801 – 673,000 36%
673,001 – 857,900 39%
857,901 – 1,817,001 41%
Above 1,817,001 45%

Annual Tax Rebates:

  • Primary: 17,235 ZAR
  • Secondary (Persons 65 and older): 9,444 ZAR
  • Tertiary (Persons 75 and older): 3,145 ZAR

Separation

The termination procedure is contingent on the terms stipulated in the employment or collective agreement and is contingent on the contract type and grounds for termination.

Upon the conclusion of employment, the employee is eligible to receive a service certificate encompassing their complete name, the employer's name and address, a description of any applicable council or sectoral employment standard governing the employer's business, the commencement and termination dates of employment, the job title or a succinct work description, remuneration at the termination date, and, upon the employee's request, the rationale for termination.

Severance Pay

In South Africa, severance pay is termed a transition payment and is outlined in the employment contract or collective agreement. Typically, employees are entitled to receive one week's severance pay for each year of employment unless the termination results from poor performance or misconduct, in which case no severance payment is applicable.

Notice Period

In South Africa, the notice period for a permanent employee is contingent on the length of the employee's service, as outlined below:

  • 0 – 6 months of service: 1 week's notice
  • 6 months – 1 year of service: 2 weeks' notice
  • 1 or more years of service: 4 weeks' notice

The specific notice period for employees may vary and is specified in the employment contract or collective bargaining agreement; however, it cannot be less than two weeks' notice after six months of service.

Probation period

Probation or trial periods are typically stipulated in the employee's employment contract, with the standard practice in South Africa being three months. Employers can establish a longer probation period if it is considered reasonable based on the nature of the job and specific circumstances.

Start Hiring in South Africa today

When expanding globally, ensuring compliance poses unique challenges. Employers must navigate employment laws, adhere to payroll protocols, uphold DE&I standards, comply with GDPR and data protection regulations, and more. While establishing local entities and commencing hiring can be daunting, staying abreast of a dynamic compliance landscape is even more demanding.

Gloroots streamlines this process, offering a centralized platform to manage these tasks effortlessly. Our in-house experts provide comprehensive protection against cross-border employment and payroll compliance risks. We assist in crafting employment contracts, ensuring timely payments, and delivering compliant benefits, allowing you to concentrate solely on talent screening.

Our commitment is to provide a seamless global employment experience, alleviating stress for you and your employees.

Connect with our experts today to launch your global recruitment initiative.

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Experience Seamless Hiring in South Africa ?

Let us take care of all your employment needs. We guarantee easy onboarding & compliant workforce management in South Africa .

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