Navigating the complex labour laws governing employment practices is essential when running Angola payroll. However, building an in-house compliance team may not be the most efficient way to manage your remote team’s payroll in Angola.

Regardless of size, global companies need help to secure in-country expertise for localised payroll service. This is where a partner like Workforce Africa provides significant value in supporting global firms to maintain compliance when handling payroll in Angola, addressing every intricate detail, including;

• Salary computation requirements,
• Taxation legislation specifics (social security, employee income tax, corporate tax, VAT and other employee deductions.
• Benefits administration, and more (health insurance, pension, paid leaves, holiday compensation.

Workforce Africa simplifies hiring and payroll compliance for offshore talent management in Angola. No need for a subsidiary or entity setup. From contracts and onboarding to taxes, payroll, and admin tasks, partnering with us – a payroll firm in Angola will help you focus on growth for greater levels of success.

Employment Contract Termination

Under Angolan law, employment contracts may be terminated by either party with prior notice, typically a minimum of 30 days, depending on the contract terms. Employers may also terminate contracts without notice in cases of just cause, such as gross misconduct or breach of contract. Similarly, employees may resign by submitting written notice, which must be acknowledged by the employer. Adhering to proper termination procedures is crucial to avoid legal disputes or penalties.

Angola Country Overview

The Republic of Angola is located in Southern Africa and is predominantly Portuguese-speaking. Key cities include Luanda, the capital and main economic center and Huambo. These urban hubs serve as gateways to ecotourism sites and coastal resorts. With a population of over 38.5 million, Angola represents a significant demographic force in the region.

Angola is actively diversifying its economy, with notable growth in renewable energy, adding 1.1 GW of solar capacity in 2023 and agriculture, projected to reach USD 20.6 billion by 2030. While oil remains dominant, sectors like construction, mining, and services are expanding. The textile industry is being revitalized through state-led initiatives. Low labor costs and rich natural resources continue to attract foreign investment. These developments position Angola as a promising market for business expansion.

Although Angola possesses a highly skilled workforce, hiring and establishing a team can be time-consuming and challenging. However, partnering with an Employer of Record (EOR) or Professional Employer Organisation (PEO) in Angola facilitates swift market entry. It manages all legal complexities associated with operations in the country.

Payroll Processing in Angola

Local labour laws in Angola govern payroll processing, with each employee’s salary potentially calculated differently. Due to compliance concerns, processing payroll at scale can become complex, cumbersome, and risky. Here are the phases of payroll processes global businesses should understand:

• Pre-payroll Phase: Your organisation’s unique approach to payroll compliance shapes its policies and processes, including payroll preparation. Global firms must prioritise essential business elements in the pre-payroll phase, such as accurate business profile documentation and tailored work location policies, which is crucial. Customise leave and work policies to align with local standards in Angola to ensure compliance and transparency while collaborating closely with compliance teams or partners to help adhere to statutory requirements throughout the payroll management process for your remote team. In this phase also, standardising compensation packages to conform with local payment norms, such as payment cycles, which enhance compliance and meet employee expectations, is necessary.
• Payroll Calculation Phase: Streamlining input collection and validation processes ensures accurate wage calculations in this phase of payroll processing. This phase involves the actual calculation of wages, with a primary focus on this task. Utilising software automation and digital document submission tools makes payroll calculations efficient and reduces the risk of human error in this process.
• Post-payroll Phase: The post-payroll phase in Angola refers to the period after payroll processing, where employers review and settle any outstanding issues related to employee compensation, benefits, and taxes. This phase typically includes: salary payment, compliance reporting, benefit administration, audit and reconciliation. The post-payroll phase is crucial in Angola as it ensures that employers comply with regulatory requirements, maintain a good employer-employee relationship, and reduce the risk of penalties or fines associated with non-compliance.

Payroll Components in Angola

Here are some aspects comprehensively needed to navigate Angola’s payroll compliance:

• Salary/Wages
• Overtime benefits
• Social security contribution
• Paid leaves
• Paid holidays
• Payroll taxes
• Other laws

Angola’s employment regulation primarily revolves around Law No. 12/23 of December 2023, along with pertinent sections of other laws and acts. The Labor Law outlines critical aspects of payroll processing and compliance with crucial employment practices:

Salary/ Minimum Wage

The minimum monthly wage is set at AO 40,066.44 for employees in the transportation, services, and manufacturing sectors. In the extractive industry and trade sectors, the minimum wage rises to AO 48,271.73. Meanwhile, workers in agriculture and other miscellaneous sectors earn a minimum of AO 32,181.15 per month. In Angola, it is mandatory to provide a 13th salary, with 50% paid as a vacation bonus before the employee’s leave and the remaining 50% as a Christmas bonus.

Working Hours

In Angola, the standard workweek is 44 hours, with a daily limit of 8 hours. This may be extended to 54 hours per week, or 9 hours per day, under certain conditions. Employees are entitled to a meal break of at least 45 minutes, with a maximum of 90 minutes. A minimum rest period of 10 hours is required between workdays. Overtime is limited to 2 hours per day, 40 hours per month, and 200 hours per year.

Overtime Rates

Employees who work an additional 30 hours in a month are entitled to 50% extra pay based on their regular salary. If overtime hours exceed this, the compensation increases to 75% of their standard salary.

Social Security Contribution:

The Employer contributes 8%, while the Employee pays social security contributions of 3%.

Health Insurance Scheme: In Angola, employees are covered by a state-funded universal healthcare system. However, due to limitations in public healthcare quality, many employers opt to provide private medical insurance for their staff.

Personal Income Tax

Up to 100,000.00: 0% 

• 100,001.00 and 150,000.00: 13%
• 150,001.00 and 200,000.00: 16% + 12,500.00
• 200,001.00 and 300,000.00: 18% + 31,250.00
• 300,001.00 and 500,000.00: 19% + 49,250.00
• 500,001.00 and 1,000,000.00: 20% + 87,250.00
• 1,000,001.00 and 1,500,000.00: 21% + 187,250.00
• 1,500,001.00 and 2,000,000.00: 22% + 292,250.00
• 2,000,001.00 and 2,500,000.00: 23% + 402,250.00
• 2,500,001.00 and 5,000,000.00: 24% + 517,250.00
• 5,000,001.00 and 10,000,000.00: 25% + 1,117,249.00
• Over 10,000,001.00: 25% + 2,342,248.00
• Corporate Tax Rate: 25% (standard rate)
• VAT / Sales Rate: 14%

Payroll Taxes Summary

Paid Leaves

• Annual Leave: Employees are entitled to 22 days of annual leave per year. In the first year of employment, leave accrues at a rate of two days for each month worked, with a minimum of six days required to be taken during that period.
• Maternity Leave: Female employees who have contributed to social security for at least six months prior to pregnancy are entitled to 12 weeks of maternity leave. This leave begins four weeks before the expected due date or eight weeks in the case of multiple births and continues for nine weeks following the birth. If the delivery occurs later than expected, the leave is extended to ensure a full nine-week period after childbirth.
• Paternity Leave: Under Angola’s General Labor Law, employees are entitled to one day of paid leave for the birth of a child.
• Parental Leave: After maternity leave ends, employers may grant female employees an additional four weeks of unpaid leave for childcare. Employees are also entitled to one day of leave per month to care for their newborn during pregnancy and throughout the child’s first year.
• Family Support Leave: Employees are entitled to eight days of paid family leave each year, contingent upon prior approval from the employer.
• Military Service Leave: Employees are permitted to take up to two days of paid leave per month for military duties, capped at a maximum of 15 days per year.
• Education Leave: Employees may take up to 60 days of unpaid leave for education or training, provided they give the employer 30 days’ written notice in advance.
• Paid Public Holidays: In Angola, the paid holidays are as follows:
  • January 1: New Year’s Day
  • February 4: Liberation Day
  • Carnival: Date Varies
  • Women’s Day: March 8
  • Good Friday: Date Varies
  • Easter: Date Varies
  • Peace Day: April 4
  • Labour Day: May 1
  • National Heroes’ Day: September 17
  • All Soul’s Day: November 2
  • Independence Day: November 11
  • Christmas Day: December 25

Payroll Outsourcing in Angola

Payroll in Angola also encompasses termination and probationary periods law. Employees are not generally eligible for severance pay, except the termination is unjustified, or the employer voluntarily decides to make severance payment.

Collaborate with an Africa employer of record and payroll solutions provider such as Workforce Africa to strategically outsource your payroll operations while ensuring compliance with local labour regulations. Additionally, leverage our flexible service offerings to expand your international teams as needed.