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Uganda payroll, hiring, talent management, and compliance requirements for your employees and independent contractors.
Workforce Africa simplifies hiring, payroll, talent management as well as your compliance needs for employees and independent contractors in Uganda. No need for a subsidiary or entity setup. From contracts and onboarding to taxes, payroll, and admin tasks, partnering with us — the Employer of Record in Uganda, will help you focus on growth for greater levels of success.
Kampala
Employment and labor laws in Uganda encompass three types of contracts: express term contracts, which involve agreed-upon conditions between employer and employee; fixed-term contracts, where employment is for a specified period and ends automatically upon expiry; and indefinite period contracts, which establish permanent employment for specific positions.
Yes
Ugandan Shilling
The best practice in Uganda is 130000 UGX/Month. However, employers consider the Uganda Revenue Authority PAYE computations.
English
Workforce Africa makes it hassle free to hire and manage your remote staff in Uganda without having to first set up a subsidiary or entity in the country. We handle staff contract management and onboarding, payroll, compliance, taxes, and other administrative matters. With Workforce Africa, you can now focus more on strategic activities and growing your business. These items include >>
Payroll frequency is monthly and bi-monthly.
The probationary period lasts for a maximum of six months. However, it can be extended for up to six months with the employees’ agreement.
Day of rest: Employees have the right to 24 consecutive hours of rest per week, which can occur on a customary rest day (Sunday) or a day mutually agreed upon by both the employer and the employee.
In Uganda, the minimum age for commercial employment is 16 years. Children aged 14 and above can be engaged in light work under the supervision of an adult over 18. However, the work hours and tasks should not interfere with the child’s education.
An employee's standard working hours in Uganda are a maximum of eight hours per day and 48 hours weekly. Including lunch and worship time, the working hours can be nine hours daily.
There are the official public holidays in Uganda:
New Year’s Day – 01 January
NRM Liberation Day – 26 January
International Women’s Day – 8 March
Good Friday (exact day varies)
Easter Monday (exact day varies)
Labour Day – 1 May
Martyrs’ Day – 3 June
National Heroes’ Day – 9 June
Eid al-Fitr (end of Ramadan, exact day varies)
Independence Day – 9 October
Eid al-Adha (Feast of the Sacrifice, exact day varies)
Christmas Day – 25 December
Boxing Day – 26 December
To qualify for a work permit in Uganda, you must satisfy the following conditions:
Have a valid passport
Secure a job offer from a Ugandan company or organization
Demonstrate the requisite qualifications and experience for the position offered
A Uganda EoR offers this service to help global businesses manage their team expansion.
An employee working sixteen or more hours per week is eligible for 21 working days of paid annual leave. This entitlement accrues at a rate of 7 days for every continuous 4-month period of service after completing 12 months of continuous service. Both parties must mutually agree upon the timing for taking annual leave.
Sick leave: Following one month of uninterrupted employment, employees working at least 16 hours per week become eligible for paid sick leave. This sick leave is compensated at employee’s total regular salary rate.
Maternal leave: Employees are entitled to 60 days of maternity leave. Following the child’s birth, a minimum of four weeks of maternity leave must be taken. In cases of illness or delivery complications, maternity leave may be extended for four weeks.
Paternal leave: Male employees are entitled to four days of paternity leave.
Parental leave: Following the birth of a child or the miscarriage of his wife, a male employee is entitled to four fully paid working days of paternity leave per year.
Bereavement leaves: The law is silent on bereavement leave
Social Security Contributions: An employed individual must contribute 5% of their gross earnings to the national social security fund. Employers must also contribute 10% of each employee’s gross pay to the national social security fund.
Personal income tax (Resident):
| Taxable Income Monthly (UGX) | Tax Rate Amount |
|---|---|
|
0 to 235,000 |
Nil |
|
235,000 to 335,000 |
(Taxable Income – 235,000UGX) x 10% |
|
335,000 to 410,000 |
(Taxable Income – 335,000UGX) x 20% + 10,000UGX |
|
410,000 to 10,000,000 |
(Taxable Income – 410,000UGX) x 30% + 25,000UGX |
|
Above 10,000,000 |
((Taxable Income – 410,000UGX) x 30%) + (25,000UGX + (10,000,000UGX) x 10%) |
Personal income tax (Non-Resident):
| Taxable Income Monthly (UGX) | Tax Rate Amount |
|---|---|
|
0 to 335,000 |
Taxable Income x 10% |
|
235,000 to 335,000 |
(Taxable Income – 335,000UGX) x 20% + 33,500UGX |
|
335,000 to 410,000 |
(Taxable Income – 410,000UGX) x 30% + 48,500UGX |
|
410,000 to 10,000,000 |
(410,000UGX) x 30% + 25,000UGX |
|
Above 10,000,000 |
((Taxable Income – 410,000UGX) x 30% + 48,500UGX) + ((Taxable Income – 10,000,000UGX) x 10%) |
Workers who work in multiple places are subject to a fixed tax rate of 30% on their total income from all employment.
Corporate Tax Rate: The corporate income tax rate stands at 30%. However, oil, gas, and specific mineral exploitation activities face varying tax rates, ranging from 25% to 45%. These rates depend on the ratio of their taxable income to gross revenue.
VAT / Sales Tax Rate: VAT is charged at the rate of 18%
Medical insurance is not compulsory but it's best practice. Uganda's healthcare system comprises publicly funded (national and district-based) and privately funded facilities. While the government regulates all healthcare facilities, private businesses invest in and manage hospitals, clinics, and pharmacies. A Uganda employer of record can help employers make provision of health insurance for their remote employees.
The compensation and benefits in Uganda include maternity benefits, compensation to the family for death during service, disability benefits, retirement compensation, and more.
According to labour laws in Uganda, employees are entitled to double the standard hourly wage rate for working overtime on public holidays. At the same time, regular workdays are one and a half times.
Termination Process: At the end of the contract term, an employment agreement can be terminated by either the employer or the employee, with or without notice. Employers retain the right to dismiss employees without cause in the event of a significant breach of contract obligations by the employee. Otherwise, the employer is required to provide notice to the employee. The length of the notice period ranges from two to three months, determined by the employee’s tenure.
Notice Period: The notice period depends on the employee’s tenure. It is two weeks for employees with over six months but less than one year of service, one month for those with over twelve months but less than five years, two months for those with over five but less than ten years, and three months for those with over ten years of service.
Severance Pay: While the law outlines provisions for severance pay, this compensation is subject to negotiation between the employer and the employee. After six months of continuous service, the employee becomes eligible for severance pay.
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