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

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 Tunisia, addressing every intricate detail, including;

• Salary computation requirements,
• axation 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 Tunisia. 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 Tunisia will help you focus on growth for greater levels of success.

Employment Contract Termination

In accordance with the laws Tunisia, employment contracts can be terminated by either party upon giving notice, depending on the terms of the contract. The employer may also terminate an employee’s contract without notice if there is just cause, such as gross misconduct or breach of contract. Conversely, an employee may terminate their contract by resigning in writing, which must be acknowledged by the employer. It is essential to follow the proper procedures for terminating an employment contract to avoid any potential legal disputes or penalties.

Tunisia Country Overview

The Republic of Tunisia lies in North Africa. It is predominantly an Arabic-speaking country. Three critical cities in Tunisia are Tunis, the capital and the economic hub, Sfax and Sousse. These urban centres act as transit points to ecotourism destinations and beach resorts. With a population exceeding 12.5 million people, Tunisia boasts a significant demographic presence.

In recent years, key industries experiencing growth include renewable energy and agriculture. Tunisia boasts a market-based, diversified economy comprising oil, manufacturing, mining and services. Considerations such as the low labour cost and abundant natural resources make Tunisia attractive for businesses seeking expansion opportunities.

Although Tunisia 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 Tunisia facilitates swift market entry. It manages all legal complexities associated with operations in the country.

Payroll Processing in Tunisia

Local labour laws in Tunisia 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-:

A. 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 Tunisia 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.

B. 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.

C. Post-payroll Phase:

The post-payroll phase in Tunisia 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 Tunisia 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 Tunisia

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

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

Navigating Tunisia Payroll Compliance

Tunisia’s employment regulation primarily revolves around Labour Code of 2017 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 national minimum wage officially established is TND 528.320 for a 48-hour week and TND 448.238 for a 40-hour week.
• Working Hours: The standard workweek is either 48 hours or 40 hours, depending on the applicable collective labour agreement or employer policy. A typical workweek consists of five days (Monday to Friday) and should not exceed 48 hours. Employees must not work more than 10 hours per day or 60 hours per week.
• Social Security Contribution: The Employer contributes 16.57% and 1% housing levy, while the Employee pays social security contributions of 9.18%. 
• Health Insurance Scheme: Health Insurance Benefits in Tunisia. To qualify for sickness benefits, employees must have either: 
  • 50 days of covered employment in the last two quarters, or 
  • 80 days of covered employment in the last four quarters before the illness begins. 
  • After a five-day waiting period, the insured employee receives 66.7% of their daily average earnings for up to 180 days.
  • For each subsequent year, they are entitled to 50% of their daily average earnings for up to 180 days annually.
  • Workplace Accident Contribution: The rate varies between 0.4% and 4%, depending on the business sector. However, most industries typically apply a standard rate of 0.5%. 
  • Pension Contributions: Pension contributions are governed by Public Servants’ Social Security Administration for employees in the public sector and Private Organization Employees’ Social Security Fund Administration for employees in the private sector.
• Payroll Taxes:

• Paid Leaves:
  • Annual Leave: An employee who has completed at least one month of actual work with the same employer is entitled to one day of annual leave per month. The total annual leave allowance is capped at 15 calendar days per year, including 12 working days. This entitlement increases with the length of service.
  • Sick Leave: Tunisian law does not specify a set number of sick days. However, employees must notify their employer of their illness within 48 hours and provide a medical certificate. Eligible employees receive sick leave payments through social security.
  • Maternity Leave: An employee is entitled to 30 days of paid maternity leave upon childbirth. In cases of illness or complications related to pregnancy or childbirth, an additional 15 days of leave may be granted. In addition, a female employee is entitled to two paid nursing breaks of 30 minutes each per day to breastfeed her child until the child reaches 12 months of age. One break is scheduled in the morning and the other in the afternoon, with the exact timing determined by mutual agreement between the employee and employer. These breastfeeding breaks are in addition to regular breaks and are counted as part of the working hours.
  • Paternity Leave: The spouse is entitled to one day of paid leave for the birth of a child. This leave can be taken within seven days from the child’s birth date.
  • Other Leave: In Tunisia, employees may be granted compassionate/ special leaves on some family events. Such leave shall be paid within the limits and deadlines specified. Public holidays are not fixed days and they can be changed according to the government decision.
• Paid Public Holidays: In Tunisia, the paid holidays are as follows:
  • January 1: New Year’s Day
  • January 14: Revelation and Youth Day
  • March 20: Independence Day
  • April 9: Martyr’s Day
  • May 1: Workers’ Day
  • July 25: Republic Day
  • August 13: Women’s Day
  • October 15: Evacuation Day
  • May/June: Eid Al-Fitr
  • June/July: Eid Al-Adha
  • Islamic New Year
  • October/November: Prophet Mohammed’s birthday.

Payroll Outsourcing in Tunisia

Payroll in Tunisia 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.