How to hire remote employees in

South Africa

South Africa’s a great place to hire remote talent. But labor laws are complicated, and it’s nearly impossible to figure out how to hire there on your own. That’s what we’re for. By the end of this page, you’ll know exactly how you can hire remote talent in South Africa—without spending thousands in fees.

Country snapshot

CURRENCY
South African Rand (ZAR)
EMPLOYER TAXES
2%
PAYROLL FREQUENCY
Monthly/Bi-Weekly/Weekly
OFFICIAL LANGUAGE
Afrikaans,English

What to know before you hire in 

South Africa

Laws about hiring are complicated. Especially when they’re in countries you’re not used to hiring in. But we’re here to make things simple. Below, you’ll learn the two options you have for hiring in South Africa—and the advantages and disadvantages of each.

If you want to successfully hire in 

South Africa

, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in 

South Africa

. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Panther for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in 

South Africa

 is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Why hire independent contractors in 

South Africa

Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in 

South Africa

.

It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Panther’s locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Panther, then $49 per month to hire your contractors with Panther. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

Hiring contractors in 

South Africa

 means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

It’s less risky than hiring employees

Hiring employees is a bigger commitment, and generally puts you at a bigger risk for legal fees. When you hire contractors overseas, your biggest risk is misclassification—but even then, misclassification penalties are often minimal and just require you to pay off any compensation that the person would have been owed as an employee.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

How can I pay people in 

South Africa

?

If you’re hiring contractors in 

South Africa

, you can pay them with Panther in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

Hiring and paying your team in 

South Africa

Hire and pay with Panther

Pay everyone with a single click
Get great currency conversion rates
Pay $0 in platform fees
Run payroll in seconds
Let Panther automatically create & store invoices
Let Panther automatically write locally-compliant contracts
Let Panther automatically file local tax documents

Hire and pay without Panther

Pay all your contractors individually
Do all currency conversions yourself
Shoulder the burden of platform fees
Spend hours each month making payments
Manually track & store invoices
Manually write & sign contracts
Manually file relevant tax documents

Let Panther save you from hiring headaches.

Sign up today for $0

If you want to hire employees in 

South Africa

If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in South Africa than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in South Africa.

Taxes in 

South Africa

Employer tax

Employer Contributions

  • 2%

Individual tax

Leave

Paid Time Off (PTO)

The minimum mandatory annual leave in South Africa is 15 workdays and it is accrued monthly at a rate of 1.25 days per month. 

Public Holidays

There are 13 public holidays in South Africa.

Sick Days

In South Africa, sick leave is based on a 36–month cycle.  

For the first 6 months of employment, the employee is entitled to 1 day of sick leave for every 26 days worked. From the first day of the 7th month, the employee receives:  

  • 30 days if they work a 5-day work week or  
  • 36 days if they work a 6–day work week  
  • 33 days if an employee works Monday- Friday and a Saturday every 2 weeks, but does not apply to employees who work less than 24 hours a month. In this case, sick leave would need to be determined when negotiation the employment contract.   

The number of sick days taken is subtracted from these amounts to come up with the total number of sick days the employee is able to take.   

At the end of the 36–month cycle, the number of sick days resets.  

If the employee is absent for more than 2 consecutive days, they must produce a medical certificate.  However, if the employee is sick from Friday to Monday, this is not considered consecutive days of sick leave, and are not obligated to produce a medical certificate.  

During a leave due to illness, the employee is entitled to full pay and cannot be terminated so long as they have a medical certificate.

Maternity Leave

In South Africa, a woman is entitled to 4 months of unpaid maternity leave.

This entitlement can begin from at least 4 weeks before the birth.  However, If the woman is not able to work due to her medical condition, it is possible to begin the leave earlier.

The employer is not obligated to pay the employee for maternity leave. Instead, a claim can be made from the Maternity Benefit Fund if contributions have been made to the Unemployment Insurance Fund (UIF).  The maximum the employee is able to receive from this benefit is 60% of their regular pay and are paid for 121 days.

Paternity Leave

Paternity falls under Parental leave.

Parental Leave

Fathers are entitled to 10 days of parental leave, paid by the UIF at a rate of 66% of the regular pay.  For the father to exercise parental leave, they must inform their employer in writing at least one month before the expected due date of the child. This leave also applies to adoptive fathers

Termination

Termination Process

In South Africa, employers are not able to terminate an employee at will, but can be dismissed for the following:

  • Misconduct– usually given without notice
  • Incapacity (health or poor performance)- termination due to poor performance is usually given after the employee receives an opportunity to meet his or her performance standards.
  • Operational requirements of the company

When the employee and employer would like to separate amicably, a separation agreement is common.

Notice Period

Both the employee and employer must follow the same notice period based on the length of the employment relationship:

  • 6 months or less – 1 weeks’ notice
  • 6- less than 1 year – 2 weeks’ notice
  • More than 1 year- 4 weeks’ notice

For farm and domestic employees, the above notice periods must be followed and may not be shortened.

It is possible, however, to shorten the notice of 4 weeks to no less than 2 if stated under a collective bargaining agreement for other types of employees.

Severance Pay

If the employee is terminated due to poor performance or misconduct, the employee is not entitled to provide severance pay.

If the employee is terminated due to operational requirements, the company is obligated to pay the employee one week’s severance pay for every year employed.

Probation Period

3 months is the common practice. 

Employee requirements in 

South Africa

Working Hours

Full-time employment is considered 45 hours weekly, and 9 hours daily.

Overtime

Up to 10 hours overtime per week is permitted. Employees earning below the threshold (R 205,433.30 per year) must be paid 150% of their normal wage for overtime worked on weekdays and 200% for Sundays. 

Employees who earn in excess of the threshold (R 205,433.30 per year) are not subject to overtime pay. However, the employer cannot force employees to work overtime without compensation unless the employee agreed to this. 

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