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How To Hire New Remote Employees | Eritrea

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Eritrea

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Eritrea

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Eritrea

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capital city
Eritrea
currency
Eritrean nakfa (Nfk, نافكا, ናቕፋ ERN )
language spoken
Tigrinya
payroll frequency
Monthly
employer taxes
No payroll tax
vat - standard rate
3% 5% 10% 12%
cost of living index
2,400.30 Eritrean Nakfas
gdp - real growth rate
8.7% (2011)
termination process
Varies
employee protections
Moderate
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employer taxes
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vat - standard rate
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cost of living index
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gdp - real growth rate
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termination process
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employee protections
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Overview

Eritrea's major job sectors are agriculture, light industries, fishing, and services, such as tourism. Agriculture has historically supported the majority of the population but it accounts for less than a fifth of the GDP and less than half of export sales. However, other industries, particularly marine-related activities and services, are increasing, and agriculture is evolving to a modern sector.

Eritrea's economic freedom score is 39.7, ranking it at 171 in the 2022 Index of Economic Freedom. Eritrea is placed 44th out of 47 Sub-Saharan African countries, and its overall rating is lower than the regional and global averages.

Public Holidays

1 January- New Year's Day

8 March- International Women's Day

1 May- Labour Day

24 May- Independence Day

20 June- Martyrs' Day

1 September- Revolution Day

25 December- Christmas Day

Minimum wage

Eritrea has no national minimum salary but the basic income in the public sector is Nfk 360 monthly. 

Payroll cycle

Eritrea's typical payroll cycle is monthly. 

Taxation

The Eritrean government reviews and updates taxes, including personal income tax, expenses, and limitations regularly. Although not all tax rates and thresholds in Eritrea vary annually, changes in tax policy to support strategic economic growth in Eritrea imply that certain areas may be targeted to provide specific tax relief or to support growth in specific areas such as overseas investment.

Leaves

Annual Leave 

Employees are entitled to 14 days of paid annual vacation after one year of service. This increases with one day for every year of service. However, the annual leave days should not exceed 35 working days. Employers are expected to pay any accrued but unused days when employees leave their jobs.

Sick Leave 

After completing the probation, employees are entitled to six months of sick leave. The sick leave can be consecutive or partial throughout the year.  Employees are paid in full or in part for the first two months, with no pay from the third to the sixth month. Employees may be required to present a medical certificate proving their illness.

Maternity Leave 

Female employees are entitled to consecutive 60 days of paid maternity leave. Maternity leave typically begins after the birth but it may begin before birth. A woman on maternity leave cannot be fired by her employer.

Paternity Leave 

After the child is born, male employees are entitled to three days of paid paternity leave.

Termination process

Employers in Eritrea have the right to fire employees without cause after the end of a fixed-term contract, during the probation period, due to the employee's death, failure to perform, or misconduct.

Falsifying documents, theft or breach of trust, missing work for five consecutive days or 10 days in a year without explanation, disclosing confidential information, or breaking the provisions of a collective bargaining agreement are examples of misconduct.

Notice Period 

An employee on probation has the right to terminate their employment without cause.

Severance Pay

Employees are entitled to the following severance pay if their job is terminated:

  • For the first five years of service, two weeks' pay; and
  • After the fifth year, each year of employment is worth three weeks' pay.

Probation Period 

In Eritrea, the probation period cannot exceed 90 days.

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