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Cameroon payroll outsourcing and compliance requirements for your employees and independent contractors.
Navigating the complex labour laws governing employment practices is essential when running Cameroon payroll. However, building an in-house compliance team may not be the most efficient way to manage your remote team’s payroll in Cameroon.
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 Cameroon, addressing every intricate detail, including;
Workforce Africa simplifies hiring and payroll compliance for offshore talent management in Cameroon. 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 Cameroon will help you focus on growth for greater levels of success.
Yaoundé
The notice period for terminating an employment contract in Cameroon varies depending on the employee's length of service; less than a year is one month, between 1-3 years is two months, and more than three years is three months.
Yes
Central African CFA franc (FCFA/ XAF)
French, English
41,875 FCFA per month
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The Republic of Cameroon lies in west-central Africa. It is predominantly a French-speaking country with English also holding official status. Two critical cities in Cameroon are Yaoundé, the capital plus largest city, and Douala, a seaport. These urban centres act as transit points to ecotourism destinations and beach resorts. With a population exceeding 27.9 million people, Cameroon boasts a significant demographic presence.
In recent years, key industries experiencing growth include petroleum production, food processing, and timber. Cameroon boasts a market-based, diversified economy comprising oil and gas, timber, aluminium, agriculture, mining, and services. Considerations such as the low labour cost and abundant natural resources make Cameroon attractive for businesses seeking expansion opportunities.
Although Cameroon 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 Cameroon facilitates swift market entry. It manages all legal complexities associated with operations in the country.
Local labour laws in Cameroon 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 Cameroon 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: This stage involves sending an invoice to the bank or payment processor to initiate salary disbursement. The post-payroll phase primarily focuses on salary payments, although accounting and reporting are also vital for related purposes. Payroll accounting internally tracks all wages disbursed, representing a significant company expense.
Reporting all payments and deductions to an external authority ensures compliance with regulations, as governing bodies often demand various supporting documents like tax forms related to payroll.
Ensuring compliance with local labour laws while running payroll in Cameroon necessitates understanding the essential components that require careful consideration.
Here are some aspects comprehensively needed to navigate Cameroon’s payroll compliance:
Cameroon’s employment regulation primarily revolves around Law No. 92/007 of 14 August 1992, commonly referred to as the Labor Code, along with pertinent sections of other laws and acts.
The Labor Code outlines critical aspects of payroll processing and compliance with crucial employment practices:
Salary/ Minimum Wage: The government formalised three separate minimum wages in the country for the first time. Commencing 22nd March 2023, government employees covered by the Labour Code received a minimum salary of 41,875 FCFA per month. Employees in the agricultural and related sectors, 45,000 FCFA per month. Another category encompasses all workers in sectors other than those mentioned, with a monthly pay of 60,000 XAF.
Initially, the state proposed a uniform quantity of 41,875 XAF for all workers. It’s worth noting that the previous revision of the Minimum Guaranteed Interprofessional Salary (Smig) in Cameroon occurred on 24 July 2014, setting the minimum wage at 36,270 FCFA.
Overtime Benefits: Employees in Cameroon typically work 40 hours a week, except for the agriculture sector. Although no specific provisions exist for daily working hours, it is customary to adhere to eight-hour workdays. Cameroon permits up to 20 hours of overtime per week, with overtime pay structured as follows:
Social Security Contribution: Employers and employees in Cameroon must make monthly contributions to the National Social Insurance Fund.
Employers contribute at a rate of 11.2%. Additionally, employers must contribute to the National Social Insurance Fund for Industrial Accidents at rates of 1.75%, 2.5%, or 5% of total salaries, depending on their classification in groups A, B, or C based on the type of activity. These contributions are calculated based on the gross salary, including assessed benefits in kind. Employees must contribute to the National Social Insurance Fund (NSIF) for their welfare, with the contribution rate determined by their salaries. Employers withhold this contribution from the employee’s salary.
The employee’s contribution covers old age pension, permanent and total disability pension, and survival pension. The contribution rate is 4.2% based on the taxable salary. The rate for voluntary insurance for this contribution is 8.4%.
In Cameroon, employers must contribute 2.5% of their employees’ total salaries and fringe benefits each month to the Housing Loan and Employment Fund of Cameroon.
Payroll Taxes:
The PIT is levied on an employee’s income per graduate scale provided by the tax code. Under Article 34 of the General Tax Code, the net taxable income is determined by deducting from the gross salary and assessed benefits.
The rates drawn therein are applied to gross taxable wages, which comprise the entirety of the remuneration paid to the taxpayer by the employer (salary + benefits and taxable bonuses). The law has retained these rates as follows: Housing 15%; Electricity 4%; Water 2%; Per servant 5%; Per vehicle 10%; Feeding 10%.
Professional expenses are calculated at a flat rate of 30%, as are contributions to the state and the National Social Insurance Fund (NSIF).
Alongside PIT are other taxes levied on salaries. These are incidental payroll taxes as explained below;
The basis for calculating them is the gross number of wages earned. The monthly audiovisual royalty borne by employees is fixed as follows:
Paid Leaves: Worker shall be entitled to paid leave of two (02) working days per month of effective service. Hence, annual leave of 24 working days for each year of service. The leave policy is to pay 12 months’ salary for 11 months worked and leave must be taken
The length of the paid leave is increased according to the seniority of the worker in the enterprise in conformity with the table below:
Employees receive Statutory Sick Pay if they experience an illness lasting more than four days. While Cameroon has not ratified International Labor Organization conventions regarding sick leave, it is recommended that workers receive at least 45% of their pay during the first six months of illness.
Every pregnant woman is entitled to 14 (fourteen) weeks of maternity leave starting 4 (four) weeks before the due date of confinement. Such leave may be extended by 6 (six) weeks in case of a dully certified illness resulting either from pregnancy or confinement. During such leave, the employer shall not terminate the employment contract of the woman in question. Where the confinement occurs before the due date, the rest period shall be extended so that the worker receives the full 14 (fourteen) weeks of leave to which she is entitled. Where the confinement occurs after the due date, leave taken before may be extended to the date of confinement without such extension leading to the reduction of the postnatal leave.
The woman shall be entitled, during the maternity leave, to a daily allowance, payable by the National Social Insurance Fund (NSIF) and equal to the amount of the wages, received at the time of suspension of the employment contract; she shall retain the right to benefits in kind. Maternity leave is increased by 4 (four) weeks in the event of twin births. This additional period of leave, which is not borne by the NSIF, is paid at 80% of the normal rate by the company.
In Cameroon, according to section 64 of the collective convention of commerce, employees can be granted compassionate/ special leaves on some family events. Such leave shall be paid within the limits and deadlines specified. Provided that in number they do not exceed twelve working days per calendar Year. These leaves are:
Paid Public Holidays: In Cameroon, the paid holidays are as follows:
Other Laws: By law, employers in Cameroon must provide employees with a mandatory end-of-year bonus, amounting to one month’s salary. Typically disbursed in December, this bonus forms an integral part of the employee’s compensation package.
Payroll in Cameroon also encompasses termination and probationary periods law. Probation typically spans six months, extending to eight months for managerial roles. Termination notices hinge on employee work classification and tenure. For instance, workers in specific sectors with over five years of service necessitate three to four months’ notice.
Payroll outsourcing in Cameroon primarily helps global companies in the country file tax returns on time, ease the pressure of work, reduce the burden of processing payment for their workforce in Africa with 100% accuracy and within timelines – Companies want to avoid errors in employee salaries, as salary is one of the critical reasons for attrition.
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.
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