Run your business seamlessly with Neeyamo as we help you go beyond borders to manage your international payroll and hire new talent in Malawi.
Malawi, situated in East Africa, possesses unique natural and cultural riches untouched by mass tourism. From blissful shorelines along the immaculate Lake Malawi to upland savannas teeming with wildlife, lush mountains, and plateaus, Malawi charms visitors seeking tranquility, adventure, and ecological immersion.
Do your organization's expansion plans require hiring employees in Malawi? 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 Malawi - processing payroll, managing local compliance requirements, benefits, and more.
Tools And Instances
Facts And Stats
Malawian Kwacha (MWK)
01 July - 30 June
Country Calling Code
Chewa, Yao, Tonga, Sena, and Elomwe
GMT + 02:00
Handling payroll for a widespread workforce can pose a significant challenge for any organization, and the added complication of compliance can make things worse. If companies spend more time processing payroll, it directly impacts day-to-day operations and their overall productivity.
Over the years, Neeyamo has observed these complexities and strived to provide a global payroll solution through a single technology platform - Neeyamo Payroll. Cloud based payroll service providers, like Neeyamo, assess payroll industry trends and offer a consolidated solution in its Global Payroll Technology Stack making outsourcing payroll cost per employee easier.
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.
Employees must contribute 5% towards the National Pension Scheme.
Employee income tax brackets are as follows:
|Income (in MWK)
|Up to 1,200,000 MWK
|1,200,000 – 12,000,000 MWK
|12,000,000 – 36,000,000 MWK
|36,000,000 – 72,000,000 MWK
|72,000,000 MWK and above
For expat employees, the income tax is at a flat rate of 15%.
Employees must contribute 10% towards the National Pension Scheme.
Undoubtedly, payroll is a critical aspect of any organization. The Pay cycle in Malawi is a notable feature that provides a sense of accountability for an employee to be paid consistently for their work.
The Employment Act stipulates that an employer will pay wages to an employee in the following manner:
- No less than once a week or two weeks in the case of an employee whose wages are fixed by the hour, day, or week or calculated on a project basis
- No less than once a month in the case of an employee whose wages are fixed on a monthly or yearly basis
13th Month Cycle
There are no provisions in the law regarding 13th-month salaries.
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
Under the provision of the Employment Act, employees are entitled to a minimum wage of 50,000 MWK per month or 2,380 MWK per day for both urban and rural areas.
All employees working hours are stipulated within the employees’ contract. A standard full-time working week in Malawi is no more than 48 hours.
Normal working hours on a public holiday are paid at twice the regular salary rate.
Overtime hours worked during rest days are paid at 200.00% of the normal salary rate of pay, and overtime hours on a public holiday are paid at 400.00% of the normal salary rate of pay.
Overtime during the working week/workdays is compensated as a daytime off rather than financially.
Data Retention Policy
At present, there is no specific law in Malawi that deals with data protection. However, the Electronic Transactions and Cyber Security Act 33 of 2016 contains provisions that are relevant to data protection and can be applied in this context.
Hiring and Onboarding Requirements
Employment Law Protections in Malawi
The main legal framework regulating employment relationships in Malawi is the Employment Act.
Other essential legal sources include:
- Constitution of Malawi
- Occupational Safety, Health and Welfare Act
- Workers’ Compensation Act
- Pension Act
- Labor Relations Act
The specific onboarding documents required for employees in Malawi may vary depending on the employer and the industry. However, some of the most common onboarding documents include:
- Contact information
- Emergency contact information
- Proof of Identity
- Educational Documents
Depending on the contract, the probation period in Malawi can last up to 12 months, but common practice is 3 to 6 months.
- 1 January - New Year
- 2 January - Day off for New Year
- 15 January - John Chilembwe Day
- 16 January - Day off for John Chilembwe Day
- 3 March - Martyrs' Day
- 7 April - Good Friday
- 10 April - Easter Monday
- 22 April - Eid al-Fitr
- 24 April - Day off for Eid al-Fitr
- 1 May- May Day
- 14 May - Kamuzu Day
- 15 May - Day off for Kamuzu Day
- 6 July - Independence Day
- 15 October - Mother's Day
- 16 October - Day off for Mother's Day
- 25 December - Christmas Day
- 26 December - Boxing Day
The length of annual leave depends on the working days in a week:
- 18 working days if the worker works six days a week;
- 15 working days if the worker works five days a week.
This leave should be taken within six months of the entitlement to the leave falling due provided that the leave may be deferred and accumulated by mutual agreement.
An employee is entitled, after completing 12 months’ continuous service, to at least four weeks’ sick leave on full pay and eight weeks’ sick leave on half pay during each year. During sick leave, an employee is paid the normal rate of wages.
A female employee is entitled, within every three years, to at least eight weeks of maternity leave on full pay.
During the period when an employee is on maternity leave, her normal benefits and entitlements, including her contractual rights and accumulation of seniority, should continue uninterrupted and her period of employment should not be considered to have been interrupted, reduced, or broken.
There is no statutory provision for paternity leave in Malawi.
There are no statutory provisions for unpaid leave in Malawi.
According to an amendment to Labour Law No. 17 of late 2021, employees in Malawi will only be paid for three days while on strike, any employee who continues to strike after three days should be paid by their union.
Employers can terminate a fixed-term contract for the following reasons – business, personal, or worker misconduct. It requires notice and a written explanation for the termination. If the reason is misconduct, a warning needs to be given, and the employee gets a chance to explain actions.
Employment contracts/collective agreements may contain provisions on periods of notice. If the notice periods in the collective agreement differ from the statutory notice periods, the employer and employee observe the notice periods in the collective agreement.
The amount of notice is dependent on how often the employee is contracted to be paid.
- If the employee is paid monthly, the requirement is 30 days’ notice.
- If the employee is paid every two weeks, the notice period requirement is 15 days for an employee with less than five years’ service and 30 days for more than five years’ service.
- If the employee has been employed for less than 2 years and paid monthly, the notice period required is one week; two weeks if the employee has been employed between two and five years; one month if the employee has been employed for more than five years.
- If the employee is paid on an hourly or daily basis, the notice period requirement is one day for an employee with less than six months of service, one week for an employee with six months to two years’ service, 15 days for employees with more than two years to five years of service, and one month for employees with more than five years of service.
Employees are only eligible for severance pay if they have completed at least one year of service and an employer has terminated their contract due to economic reasons (i.e. lay-offs) or if they have been terminated unfairly.
The severance payment due is linked directly to the number of years service completed:
- 1-5 years of service: 2 weeks’ pay for every year of employment
- 6-10 years: 3 weeks’ pay for every year of employment
- 11+ years: 4 weeks’ pay for every year of service
You need a Temporary Employment Permit if you are a foreigner with an offer of employment in Malawi. The employer is responsible for applying for the permit on behalf of the employee.
The application process is outlined in The Policy Statement on The Employment of Expatriates. The required TEP application form and supporting documents are submitted at the Immigration Headquarters or Regional Immigration Offices for processing upon payment of the processing fees.
The application will then be submitted to the TEP Approval Committee for consideration, and then to the Minister for decision.
Once a decision is made, the applicant will be formally notified of the approval or rejection. If approved, the required fees will be requested for payment within 30 days from the date of confirmation.
Employee Background Checks
Legal and Background Checks
The most common types of legal and background checks conducted in Malawi are as below:
- Employment Verification
- Identity Verification
- Education Verification
- Medical Examinations
Last updated on December 06, 2023.
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