Jamaica: A Guideline to Payroll and Employer of Record

Establish your presence globally with Neeyamo as we help you go beyond borders to manage your international payroll and hire new talent in Jamaica

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Overview

Apart from being a hub for music and creativity, Jamaica is also known to be home to some of the world's fastest individuals like Usain Bolt, Yohan Blake, Asafa Powell, Shelly-Ann Fraser-Pryce, and Elaine Thompson. Experts believe Jamaica's running talent stems largely from genetics. Beyond its legacy in track and field, Jamaica is also known for its hardworking and skilled workforce across various industries. 

Do your organization’s expansion plans require you to hire employees in a country brimming with talent and potential? Do you lack a physical entity in the country – a key requisite to hire local talent? Neeyamo – one of the top Global payroll providers, assists organizations worldwide with onboarding and managing employees in Jamaica- processing payroll, managing local compliance requirements, benefits, and more.

Tools And Instances

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Global Payroll

Neeyamo’s global payroll solution covering 180+ countries

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Global Work

A tech-based EOR solution to manage your extended workforce

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Optimize hiring process with a technology-first approach to solving the background screening problems

Facts And Stats

Capital

Kingston

Currency

Jamaican dollar (JMD)

Official Language

English

Fiscal Year

1 April - 31 March

Date Format

DD/MM/YYYY

Country Calling Code

1(876)

Time Zone

UTC-5

Global Payroll

Overview

Handling payroll for a widespread workforce can pose as a major challenge for any firm. The added complication of compliance can make things worse and drastically effect the time and efforts that can be used in other equally important aspects of an organization's development.

Over the years, Neeyamo has observed these complexities and strived to provide a global payroll solution through a single technology platform, Neeyamo Payroll.

Payroll Taxes

Payroll tax is the percentage amount retained from an employee's salary and paid to the government to invest in the welfare of the general population.

Employee Taxes

Employee Contribution:

National Insurance Scheme (NIS) (on maximum remuneration of 5 million JMD per year) : 3.00%

National Housing Trust (NHT) : 2.00%

Education Tax : 2.25%

Employee Income Tax

  1. Up to 1,500,096 JMD 0.00%
  2. 1,500,096 JMD to 6,000,000 JMD (applicable Jamaican residents) 25.00%
  3. Above 6,000,000 JMD : 30.00%

Employer Taxes

Employer Contribution:

Social Security (National Insurance Scheme - NIS):

National Insurance Scheme (NIS) (on maximum remuneration of 5 million JMD per year): 3.00%

National Housing Trust (NHT) : 3.00%

Education Tax: 3.50%

Human Employment & Resources Training (HEART) : 3.00%

Payroll Cycle

Overview

Undoubtedly, payroll is a critical aspect of any organization. The Pay cycle is a notable feature of it that provides a sense of accountability for an employee to be paid consistently for their work.

Frequency

The typical pay frequency cycle in Jamaica is monthly.

13th Month Cycle

There is no statutory requirement to pay the 13th or the 14th month salary.

Global Work

Overview

What is an Employer of Record?

An Employer of Record service provider helps you get rid of the hassle of handling the complexities that come with setting up a new employee in remote locations. They act as legal employers, facilitate salary payments, and handle everything from health insurance. payroll taxes, and employee benefits to comply with local tax laws and regulations.

This ensures that the client company can focus on the employee’s everyday tasks safely in the knowledge that they have a cost-effective solution as they continue their global expansion.

HR Mandates and Practices

Minimum Wage

Minimum wage in Jamaica is JMD$56,290 per month

Working Hours in Jamaica:

Full-time employment is considered 40 hours weekly and is generally eight hours per day.

Overtime in Jamaica

All work exceeding 40 hours per week must be paid at a rate of 150% the normal hourly rate. Work on Sundays and public holidays are paid at a rate of 200%.

Data Retention Policy

Jamaica currently does not have a comprehensive data retention law that specifically governs how long businesses and organizations must retain data.

The DPA leaves it up to organizations to determine appropriate retention periods based on legal, contractual, and operational needs.

Hiring and Onboarding Requirements

Hiring

Jamaican citizens and permanent residents often receive priority.Veterans or individuals with disabilities might be given preference in certain sectors.

The Constitution of Jamaica, the Equal Opportunity Act of 2010, and the Labour Relations Code all prohibit discrimination based on various protected characteristics, including:

Race,Gender,Religion,Political opinion,Marital status,Disability,Age,Pregnancy,Trade union membership,Social status

However, certain preferences in hiring are allowed under specific conditions.

Onboarding

The specific onboarding documents required for employees in Jamaica may vary depending on the employer and the industry. However, some of the most common onboarding documents include:

  • Proof of Identity:
  • Jamaican National ID card
  • Passport
  • Voter's ID card
  • Proof of Address
  • Utility bill: A recent utility bill (electricity, water, internet) with your name and address.
  • Bank statement
  • Government document.
  • Additional Documents
  • Birth certificate
  • Taxpayer Registration Number (TRN)
  • Proof of employment or income

Probation

Employee Probation Period:

In Jamaica, there is no legal obligation for a probationary period. Nevertheless, collective agreements commonly specify a probation period ranging from 3 to 6 months.

Leave

Public Holidays foe 2024

  • January 1: New Year's Day
  • February 14: Ash Wednesday
  • March 29:  Good Friday
  • April 1: Easter Monday
  • May 23: Labour Day
  • August 1: Emancipation Day
  • August 6: Independence Day
  • October 21: National Heroes Day
  • December 25: Christmas Day
  • December 26: Boxing Day

Sick Leave

During the first twelve months of employment, non-casual workers with at least 110 days of work are entitled to sick leave with pay at a rate of 1 day for every 22 days worked. After the initial twelve months, these workers are eligible for sick leave with pay of a duration equivalent to 2 normal working weeks in each subsequent twelve-month period.

Maternity Leave

Female employees are entitled to 3 months (12 weeks) of maternity leave. The initial 2 months (8 weeks) are paid at the regular salary rate, while the last month (4 weeks) is typically unpaid. Some companies may choose to pay for the entire 3-month period, although it's not mandatory. An employee can take a maximum of 3 paid maternity leaves with the same employer, and any subsequent pregnancies result in unpaid leave. Maternity leave can commence as early as 11 weeks before the expected due date.

Eligibility: An employee is eligible for maternity leave if she has completed 12 months of service before going on leave. Also, an employee must be at least 18 years old.

Voting Leave

Employers are required by law to provide 3 hours of time off.

Sick Leave

2 weeks of paid sick leave per year.

Sick Leave entitlement

Employees are entitled to 2 weeks of paid sick leave per year, and 3 weeks for employees who have 10 years of service.

Vacation Leave

Employees in Jamaica are entitled to 2 weeks of paid vacation leave per year. After 10 years of continuous service, employees receive 3 weeks of paid leave per year. However, most employers will grant 3 weeks of leave after the first 5 years of employment.

Termination

Overview

In Jamaica, employers can terminate an employee's employment for a variety of reasons, including:

  • Redundancy,Misconduct,Incapacity,Incompatibility,Retirement,Closure of the business
  • Employees who have been continuously employed for at least four weeks are entitled to a minimum notice period before their employment can be terminated. The length of the notice period depends on the employee's length of service:
  • Four weeks to two years: Two weeks' notice
  • Two years to five years: Four weeks' notice
  • Five years to ten years: Six weeks' notice
  • Ten years or more: Eight weeks' notice
  • Severance pay is only required for cases of redundancy.

Notice Period

The notice period required for terminating an employee's contract depends on the duration of their continuous employment:

  • Less than five years: Not less than two weeks' notice.
  • Five years or more but less than ten years: Not less than four weeks' notice.
  • Ten years or more but less than fifteen years: Not less than six weeks' notice.
  • Fifteen years or more but less than twenty years: Not less than eight weeks' notice.
  • Twenty years or more: Not less than twelve weeks' notice.

Severance Pay

Severance for redundancy is 2 weeks’ pay per year for the first 10 years and 3 weeks pay per year, from the 10th year onwards.

Visa

Overview

Citizens of 76 countries, including the United States, Canada, the United Kingdom, and most European Union countries, can visit Jamaica for up to 90 days without a visa.

Required document for work visa:

  • Valid passport with at least six months' validity beyond your intended stay
  • Completed work permit application form
  • Two passport-size photographs
  • Original letter from your employer confirming the job offer and employment details
  • Educational certificates and professional qualifications relevant to the job
  • Police clearance certificate from your home country
  • Medical certificate proving good health

Employee Background Checks

Legal and Background Checks

Below are type of Background check that commonly observed in Jamaica:

  • Education verification: Contacting educational institutions to confirm degrees and qualifications.
  • Employment verification: Contacting previous employers to verify employment history and performance.
  • Financial checks: Investigating credit history and bankruptcy records.
  • Reference checks: Contacting personal and professional references.

Last updated on January 03, 2024

If you have any queries or suggestions, reach out to us at irene.jones@neeyamo.com

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