Employer of Record (EOR) Services in Tanzania

 
An Employer of Record (EOR) is a third-party organization that legally employs workers on behalf of another company. While the client company directs the day-to-day activities of the employees, the EOR takes on responsibility for all formal employment tasks.

EOR services are particularly beneficial for companies looking to expand their global footprint swiftly and compliantly. By partnering with an EOR, businesses can mitigate the risks associated with international employment, such as navigating complex legal requirements and cultural nuances. Additionally, EORs can streamline the onboarding process, manage employment contracts, and handle terminations in accordance with local laws.

Is an EOR solution something your organization currently needs?

Cedar Africa Group can help you handle all the complexities of setting up a business in Tanzania facilitating faster market entry and reducing operational challenges.

What is an Employer of Record (EOR)?

An Employer of Record (EOR) is a third-party organization that acts as the legal employer for your workforce in Tanzania. While you maintain full control over day-to-day tasks and team management, we take care of everything else, including payroll, compliance, and taxes. This simplifies hiring and managing employees abroad, reducing your operational overhead.

How our Employer of Record (EOR) services in Tanzania work

We, the Employer of Record (EOR) services in Tanzania act as the legal employer on your behalf, managing all employment responsibilities while you oversee the employees’ day-to-day activities. Here’s how the process typically works:​

Engagement and Onboarding

When your company decides to expand into Tanzania, we facilitate the hiring process by drafting compliant employment contracts, and ensuring that all necessary documentation aligns with Tanzanian labor laws. This includes outlining terms of employment, compensation, benefits, and termination conditions. ​

Efficient Payroll and Tax Management

Managing payroll in accordance with Tanzanian laws requires that salaries, taxes, and social security contributions are calculated accurately. We handle these processes, ensuring timely and correct payments to employees and authorities, and reducing administrative burdens. 

Compliance and Legal Responsibilities

We assume responsibility for maintaining compliance with local employment laws, including managing employment contracts, adhering to working hour regulations, and ensuring proper termination procedures. This mitigates legal risks and potential fines for your company. ​

Employee Benefits and Support

We also administer employee benefits in line with local standards. This may include health insurance, life insurance, and other statutory entitlements. 

Immigration and Work Permits

For companies hiring expatriates, we assist with obtaining the necessary work permits and visas, ensuring that foreign employees are legally authorized to work in Tanzania. This support streamlines the onboarding process for international talent. ​

What our Employer of Record (EOR) services entail

Access to Local Expertise

At Cedar Africa Group, we have in-depth knowledge of Tanzania’s labour market and cultural nuances, which helps us in effective talent acquisition and management. Our local insights are valuable  for companies unfamiliar with the Tanzanian employment operations. These insights include a thorough grasp of the Employment and Labour Relations Act, tax regulations administered by the TRA, social security requirements managed by the NSSF, and existing local HR practices. With our strong track record in Tanzania, we are well equipped to help you navigate potential complexities and ensure compliance. 

COMPREHENSIVE SOLUTION SUITE

We offer a comprehensive solution suite that meets your current and future needs. For instance, if you anticipate needing assistance with talent acquisition in addition to payroll management, we offer integrated recruitment services. Cedar Africa Group’s EOR services handle many aspects of the business. From finding and hiring talent to managing payroll and ensuring compliance with labour and tax laws, we get you ready to open for business..

Talent Acquisition and Staff Outsourcing

Cedar Africa Group assists businesses in identifying and recruiting qualified candidates tailored to their specific needs. Through staff outsourcing, we manage the entire recruitment process, ensuring that the selected personnel align with your company’s objectives and culture.​

Offer Negotiation and Contract Management

We handle the intricacies of employment offers and contract negotiations. We ensure that all employment contracts are compliant with Tanzanian labour laws, clearly outlining terms of employment, compensation, benefits, and termination conditions.​

Employee Onboarding

We also facilitate a smooth onboarding process for new employees. This includes integrating new hires into the company’s operations, ensuring all necessary documentation is completed, and that employees are well-acquainted with company policies and procedures.

Workstation and Administrative Support

We provide the necessary infrastructure and administrative assistance to support employee productivity. This encompasses setting up workstations and offering ongoing administrative support to ensure efficient operations.​

Immigration Support – Visa, Special Pass, and Work Permit Processing (for expatriates)

For expatriate employees, we help them obtain the required legal documentation to work in Tanzania. This includes processing visas, special passes, and work permits, facilitating a smooth transition for foreign staff.

Health Insurance Management

We facilitate the provision of comprehensive health insurance plans, ensuring that employees have access to quality healthcare services. In Tanzania, it is mandatory for employers to provide comprehensive health insurance plans that cover not only day-to-day medical expenses but also transportation and treatment costs in case of medical evacuation.​ Cedar Africa Group helps businesses comply with Tanzanian regulations and enhances employee satisfaction and retention.

Why should you use an Employer of Record (EOR) service in Tanzania

1. Streamlined Market Entry

EOR services expedite market entry by enabling businesses to hire and onboard employees quickly, often within days, allowing companies to commence operations promptly. ​

2. Compliance with local labor laws

EOR providers possess in-depth knowledge of local employment regulations, ensuring that employment contracts, tax filings, and social security contributions are managed in accordance with Tanzanian laws, thereby reducing the risk of legal complications.

3. Cost Efficiency

Setting up and maintaining a local business involves major costs, including administrative overhead and legal fees. EOR services eliminate the need for such investments, offering a cost-effective solution for businesses to manage their workforce in Tanzania. 

4. Access to Local Expertise

EOR providers offer valuable insights into the local labor market, assisting businesses in understanding cultural nuances, employment practices, and market dynamics. This local expertise is helpful  in making informed decisions related to hiring and employee management. ​

5. Comprehensive HR and Administrative Support

EOR services encompass a range of HR functions, including payroll processing, benefits administration, and employee onboarding. By outsourcing these responsibilities, businesses can focus on their core operations while ensuring that HR tasks are handled efficiently and in compliance with local standards.

Why choose our EOR services in Tanzania?

Expert knowledge of Tanzanian labour laws

Tanzania’s labour laws are subject to frequent changes, and non-compliance can lead to fines or legal complications. Our team stays updated with the latest employment regulations to ensure your business remains compliant.

Customized solutions for your business

Whether you are hiring your first employee or managing a large team in Tanzania, our EOR services are tailored to meet your specific needs. We understand that every business is unique, and we offer customized solutions to ensure smooth operations.

Scalable services

If you need to onboard one employee or manage a growing team, our EOR services are scalable to match your business needs. As your business grows, we ensure that your HR and payroll operations run efficiently, without the hassle of expanding your legal footprint.

Dedicated support

You will have a dedicated point of contact for all HR and administrative matters. This ensures that your queries are resolved quickly, and you can focus on driving your business growth without worrying about your employee management.

Saves your business time and resources

Employing our services as your EOR service provider ensures you are free from issues that might hold back or delay your expansion into the Tanzanian market, saving you time and resources and making sure you work within your business timelines.

What you need for an Employer of Record (EOR) service in Tanzania

1. Business information: You will need to provide details about your company, including its legal name, business registration, and nature of operations.
2. Employee details: There’s also a need to share information about the employees you want to hire through the EOR. Details should include their roles, job descriptions, and compensation packages.
3. Compliance requirements: You have to outline any specific compliance needs or local regulations relevant to your industry or business operations.
4. Payroll information: An EOR service provider needs details about your salary structures, benefits, and any other compensation-related data to help find the right candidates.
5. Contractual agreements: You will need to work with the EOR to draft and finalize employment contracts that meet Tanzanian legal standards.
6. Company policies: You also need to share any internal policies or practices you wish to be integrated into the EOR service.

Employment contracts in Tanzania

In Tanzania, the Employment and Labour Relations Act of 2004 governs working hours and overtime regulations, ensuring fair labor practices and employee well-being.​

Standard Working Hours

• Weekly Limit: Employees are permitted to work up to 45 hours per week, typically distributed as 9 hours per day over 5 days.
• Daily Limit: The maximum standard working hours per day are 9 hours, exclusive of a 1-hour unpaid lunch break after 5 continuous hours of work. 
• Workweek Structure: Employees may work up to 6 days per week, with the seventh day designated as a rest day. 

Overtime Regulations

Any work performed beyond the standard 45-hour workweek qualifies as overtime.

• Daily Overtime Cap: Employees should not exceed 12 working hours per day, inclusive of overtime. ​
• Four-Week Overtime Limit: Overtime is capped at 50 hours within any four-week period.
• Overtime Compensation:
• Regular Days: Overtime is compensated at 1.5 times the employee’s regular hourly wage.​
• Public Holidays: Work on public holidays is compensated at double the regular hourly wage. ​
• Agreement Requirement: Overtime work must be mutually agreed upon by both employer and employee; it cannot be unilaterally imposed. ​Rivermate

Night Work Compensation

• Night Hours: Defined as work performed between 8:00 PM and 6:00 AM.​

Additional Compensation: Employees working during night hours are entitled to an additional 5% of their basic wage per hour. However, this does not apply to roles such as security personnel or shift workers, unless specified by law.

What you need for an Employer of Record (EOR) service in Tanzania

• Details about your company: Legal name, address, industry, and contact information.
• Information about the employee(s) you wish to hire:
• Your instructions on payroll processing: Bank details for funding payroll, expense reimbursement policies, etc.
• Confirmation of your compliance with your core business responsibilities: The EOR handles employment-related compliance, but you remain responsible for the work performed by the employee and ensuring a safe working environment according to your industry standards.

• Payroll Processing:
• Calculating and disbursing salaries accurately and on time.Handling statutory deductions. Processing expense reimbursements according to your company’s policy. Providing payslips to employees. Managing end-of-year tax reporting and compliance.
• Benefits Administration:
• Administering legally required benefits such as annual leave,  sick leave, and maternity leave.  
• Compliance with Tanzanian Labor Laws:
• Ensuring adherence to the Employment and Labour Relations Act (2004) and its regulations. Staying updated on any amendments to Tanzanian labor laws, such as the recent Labour Laws (Amendments) Act, No. 4 of 2025, and ensuring compliance with these changes.

Employment Contracts

Tanzanian law recognizes three types of employment contracts:​

• Contracts for an unspecified period: Indefinite-term contracts without a fixed end date.​

   

• Contracts for a specified period: Fixed-term contracts, typically used for professionals and managerial positions.

   

• Contracts for a specific task: Agreements tied to the completion of a particular task or project.​ While not all contracts are required to be in writing, it is advisable to provide written contracts to ensure clarity and compliance with legal standards. 

Working Hours and Overtime

The standard working week in Tanzania is 45 hours, usually spread over five days. Employees should not work more than 12 hours per day, including overtime. Overtime work must be mutually agreed upon and is compensated at 1.5 times the regular hourly wage, or double on public holidays. ​

Leave Entitlements

Employees are entitled to various forms of leave, including:

• Annual Leave: A minimum of 28 consecutive days of paid leave per year.​

   

• Sick Leave: Up to 126 days per year, with full pay for the first 63 days and half pay for the remaining period.​

   

• Maternity Leave: 84 days, or 100 days for multiple births.​

   

• Paternity Leave: 3 days.

   

Termination and Severance

Termination of employment must be based on valid reasons such as misconduct, incapacity, or operational requirements. Employees are entitled to severance pay of at least 7 days’ basic wage for each completed year of service. ​

Occupational Health and Safety

The Occupational Health and Safety Act, 2003 mandates employers to ensure the safety, health, and welfare of employees at work. This includes providing a safe working environment, adequate training, and necessary protective equipment. 

Compliance and Enforcement

The Labour Division of the High Court of Tanzania handles employment disputes. Employers must adhere to the legal framework to avoid penalties and ensure fair treatment of employees. ​

In Tanzania, employment contracts are governed by the Employment and Labour Relations Act, 2004 (ELRA), which mandates that all employees, except those working less than six days a month, must receive a written contract at the commencement of their employment. These contracts are crucial for defining the terms of employment and ensuring compliance with labor laws

Types of Employment Contracts

Tanzanian law recognizes three primary types of employment contracts:​

1. Contracts for an Unspecified Period (Permanent Contracts): These are open-ended agreements without a predetermined end date, suitable for long-term employment relationships.​

    

2. Contracts for a Specified Period (Fixed-Term Contracts): These contracts have a defined start and end date and are typically used for professionals and managerial positions. Regulation 11 of the Employment and Labour Relations (General) Regulations, 2017, mandates a minimum duration of 12 months for such contracts. Issuing fixed-term contracts for less than 12 months can lead to legal disputes and potential compensation claims.
3. Contracts for a Specific Task: These are agreements tied to the completion of a particular task or project. The contract concludes once the specified work is completed. ​

Mandatory Contractual Details

• Employers are required to provide the following information in writing to the employee at the start of employment:​
• Employee’s name, age, permanent address, and sex​

• Place of recruitment​
• Job description​
• Date of commencement​
• Form and duration of the contract​
• Place of work​
• Working hours​
• Remuneration details, including calculation methods and any benefits or payments in kind​
  Employers must ensure that the contract’s contents are clearly communicated and understood by the employee. Any changes to the contract must be made in writing and agreed upon by both parties. ​

Payroll Management in Tanzania

• Payroll Cycle: Typically monthly, with salaries paid as stipulated in the employment contract.​

   

• Minimum Wage: Tanzania does not have a universal national minimum wage. Instead, minimum wages are set by sector and occupation, as determined by the Wage Boards.​

   

• Bonus Payments: There is no statutory requirement for a 13th-month salary or annual bonuses. However, some employers may offer bonuses based on company policy or collective agreements.​

   

2. Employment Taxes in Tanzania

Employer Contributions:

• National Social Security Fund (NSSF): Employers contribute 10% of the employee’s monthly salary.​
• Workers’ Compensation Fund: Employers contribute 0.5% of the employee’s gross salary.​

   

• Skills Development Levy (SDL): Employers with 10 or more employees must pay 4% of the employee’s gross salary.​

   

Employee Contributions:

• NSSF: Employees contribute 10% of their monthly salary.​

   

Individual Income Tax:

Tanzania employs a progressive income tax system for individuals:​

• Up to TZS 270,000: 0%​

   

• TZS 270,001 – TZS 520,000: 8%​

   

• TZS 520,001 – TZS 760,000: 20%​

   

• TZS 760,001 – TZS 1,000,000: 25%​

   

• Above TZS 1,000,000: 30%​

   

3. Pension in Tanzania

The National Social Security Fund (NSSF) provides retirement benefits to employees in the private sector. Both employers and employees contribute 10% each, totaling 20% of the employee’s monthly salary. Upon reaching retirement age, employees are entitled to pension benefits based on their contributions and years of service.​

4. Work Permits & Visas in Tanzania

Employers intending to hire foreign workers must obtain work permits and residence visas for their employees. The process involves:​

• Applying to the Ministry of Labour and Employment for a work permit.​

   

• Applying to the Immigration Department for a residence permit.​

   

• Ensuring compliance with the requirement that foreign employees do not exceed a certain percentage of the workforce, promoting employment opportunities for Tanzanian nationals.​

   

5. Mandatory Leave Entitlements in Tanzania

• Annual Leave: Employees are entitled to 28 consecutive days of paid annual leave after completing six months of continuous service.​

   

• Public Holidays: Tanzania observes 17 public holidays annually. Employees are entitled to paid time off on these days.​

   

6. Paid Time Off in Tanzania

• Sick Leave: Employees are entitled to 126 days of sick leave within a 36-month cycle. The first 63 days are paid at full salary, and the remaining 63 days at half salary, upon providing a medical certificate.​

   

• Maternity Leave: Female employees are entitled to 84 days of paid maternity leave, or 100 days in case of multiple births.​

   

• Paternity Leave: Male employees are entitled to three days of paid paternity leave.​

   

• Bereavement Leave: Employees are entitled to five days of paid leave upon the death of a close family member.​

   

7. Health Insurance in Tanzania

As of 2023, the Universal Health Insurance Act mandates that all residents, including employees, must have at least a minimum level of health insurance coverage. Employers are responsible for ensuring their employees are covered, either through:

National Health Insurance Fund (NHIF): A government-run program providing health coverage.​

Private Health Insurance Providers: Accredited private insurers offering health plans that meet the minimum requirements.​
Additionally, members of the NSSF have access to the Social Health Insurance Benefit (SHIB), which provides medical care through accredited public and private healthcare providers.​

8. Termination Process in Tanzania

Employment contracts in Tanzania can be terminated for valid reasons, including misconduct, incapacity, or operational requirements. The termination process involves:​

• Providing written notice stating the reason for termination.​

   

• Adhering to the stipulated notice periods based on the employee’s length of service.​

   

• Paying any outstanding dues, including accrued leave and severance pay, if applicable.​

   

9. Notice Period in Tanzania

The notice period for terminating an employment contract depends on the employee’s tenure:​

• Less than 1 month of service: 7 days’ notice.​

   

• 1 month to 1 year of service: 28 days’ notice.​

   

• More than 1 year of service: 28 days’ notice.​

   

Alternatively, payment in lieu of notice can be provided.​

10. Severance in Tanzania

Employees are entitled to severance pay if terminated after completing at least 12 months of continuous service, except in cases of misconduct. The severance pay is calculated as follows:​

• 7 days’ wages for each completed year of service.