GABON

Compliant HR, Payroll, Tax & Employer of Record Africa

OVERVIEW

Gabon is a central African country rich in natural resources. Located on the Atlantic Ocean, it borders Cameroon, Equatorial Guinea, and the Republic of Congo. Abundant petroleum and foreign private investment have helped make Gabon one of the most prosperous countries in Sub-Saharan Africa. Extensive oil resources have been located, both on land and offshore.

In terms of proved recoverable reserves, according to the Oil & Gas Journal (OGJ), Gabon had 2 billion barrels of proven oil reserves as of the end of 2012. The fifth largest oil producer in Africa, it has had strong economic growth over the past decade, driven by its production of oil and manganese. The oil sector has accounted for 80% of exports, 45% of GDP, and 60% of fiscal revenue on average over the past five years. Most of Gabon’s oil fields are located in the Port-Gentil area and are both onshore and offshore.

With the 7th highest HDI and the fourth highest GDP per capita (PPP) in the region. Gabon GDP grew by more than 6% per year from 2010 to 2012. However, because of inequality in income distribution, a significant proportion of the population remains poor.

GENERAL INFORMATION

country capital

CAPITAL CITY

Libreville

language

OFFICIAL LANGUAGE

French

currency

CURRENCY

Central African CFA Franc (XAF)

dial code

DIALLING CODE

+241

tax calculator

TAX AUTHORITY

Ministry of Economy, foresight and sustainable development programming general – Directorate of taxeshttp://www.dgi.ga/dgi/missions

tax dates

TAX YEAR

1 January – 31 December

time zones

TIME ZONE

West Africa Time WAT (UTC +01:00)

GENERAL INFORMATION

country capital

CAPITAL CITY
Libreville

language

OFFICIAL LANGUAGE
French

currency

CURRENCY
Central African CFA Franc (XAF)

dial code

DIALLING CODE
+241

tax calculator

TAX AUTHORITY
Ministry of Economy, foresight and sustainable development programming general – Directorate of taxeshttp://www.dgi.ga/dgi/missions

tax dates

TAX YEAR
1 January – 31 December

time zones

TIME ZONE
West Africa Time WAT (UTC +01:00)

MORE INFORMATION

Temporary visa’s:

Employ-Africa can support your immigration requirements in Gabon through our in-country immigration specialist based in Libreville. Immigration and work permits are often problematic which can cause delays during projects. Temporary visitors are allowed to stay in the country for a period not exceeding three months.

Work Permit:

At Employ-Africa we are not only in a position to provide immediate support via our immigration specialists, who are vastly experienced, but we are also able to supply Work Permits under our company name by sponsoring your employee. The sponsored work permit assist’s when you have been awarded a local contract but are not yet ready to open a local office.

The employers apply for a work permit on behalf of the employee, who therefore needs to have a job position before moving to Gabon. As in Article 104 of the Labour code, before recruiting a foreign worker, a work permit must be issued by the Minister for Employment, and an employment contract signed by the competent department of the Employment ministry.

Article 105 states that the work permit is only valid for one worker, one job and one particular company. It shall be for a period of no longer than two years. It is renewable. The renewal conditions will be determined by an order issued by the minister for employment.

Employment in Gabon is regulated by the Code of Labour.

However, in terms of rules and regulations on Immigration:

Foreigners are subject to a work permit issued by the Ministry of Labour to work in the private sector

Illegal foreigners are not allowed to work

Temporary visitors are not allowed to work in Gabon, unlike workers who are bound to a contract abroad and who only come to Gabon on a mission.

Documents that are required for Work Permit applications are:

  1. Letter to the Minister of Labour
  2. An application form available at the D.D.I.
  3. Copy of current passport of the employee
  4. Copy of diplomas & certificates
  5. A copy of the employer’s ID or passport
  6. Employer legal documents (License, registration references, etc.)
  7. Employer organizational chart showing the
  8. Job description for the applied position

Normally the process of acquiring the work permit takes up to five months. The work permit is valid for 2 years after which it will need to be renewed.

http://www.china-invests.net/Gabon/GSEZ/Labor_Law_in_Gabon.pdf

Employ Africa can support the Payroll & Tax Compliance of all your expatriate and local Staff & Contractors in Gabon.

Payroll for locals is calculated and paid in Gabon franc.

Payroll for expatriate personnel is typically administered in United States Dollars (USD).

For all income derived from carrying out an assignment in Gabon, income tax is payable to the TRA at the prescribed rates for either resident or non-resident employees. Taxes are deducted from the employee’s salary/wages at source and paid over to the TRA on a monthly basis in line with the Gabon tax regulations.

Corporate taxation in Gabon is as follows:

  • Capital gains: Treated as normal business income and is taxed as such.
  • Corporate tax
    • Standard company: 30%
    • Oil company: 35%
    • Land development company: 25%
    • Gabon also has a special tax regime in place for holdings companies.

With regards to personal taxation, residents are taxed on global net income and non-residents only on their Gabon-source income.

Individual taxation is as follows:

  • Capital gains: 20%
  • Income tax: Progressive tax ranging from 0% to 35% dependent on income (see below)
  • Property tax: 15% tax based on rental value of properties
  • Social security: 2.5% of salary for an employee, and 20.1% for the employer

To calculate the tax, taxable income is divided into units, taking into account family circumstances. The tax is based on varying rates:

Up to CFA1.5m (€2250): 0%;

CFA1.5m-1.92m (€2250-2880): 5%;

CFA1.92m-2.7m (€2880-4050): 10%;

CFA2.7m-3.6m (€4050-5400): 15%;

CFA3.6m-5.16m (€5400-7740): 20%;

CFA5.16m-7.5m (€7740-11,300): 25%;

CFA7.5m-11m (€11,300-16,500): 30%; and

Above CFA11m (€16,500): 35%.

Social insurance system

Employers must contribute to the social security system, which consists of the National Social Security Fund (CNSS) and the National Disease Insurance and Social Guarantee Fund (CNAMGS).

The taxable basis for social security contributions to the benefit of the CNSS is made up of gross salaries, including indemnities having the function of a salary and any benefits in kind. However, there is an annual ceiling of XAF 18 million (or XAF 1.5 million per month).

The taxable basis for social security contributions to the benefit of the CNAMGS is made up of gross salaries, including taxable indemnities, up to the limit of a monthly ceiling of XAF 2.5 million.

The social security contributions due by the employer for both funds are determined according to the following rates:

Contribution to CNSSRate (%)
Family allowances8%
Industrial accidents (work injuries)3%
Retirement pensions5%
Contribution to CNAMGSRate (%)
Health evacuation funds0.6
Medication distribution2
Hospitalisations1.5

https://www.internations.org/go/moving-to-gabon/working

https://oxfordbusinessgroup.com/overview/balancing-books-details-country%E2%80%99s-tax-laws-and-recent-amendments

http://taxsummaries.pwc.com/ID/Gabon-Individual-Other-taxes

Fixed term employment contract.

A fixed-term employment contract is one which covers a predetermined period, agreed by the parties. A written form is compulsory. It shall be for a period of no longer than two years. It may only be renewed once. Short-term contracts may however be concluded and renewed more than once, as long as they do not exceed two years in total.

On expiry of a fixed-term contract, it may be renewed at the wish of the parties, even if this is tacit, with the extension turning the contract into a permanent contract, despite any clause forbidding tacit extension.

Cancellation of a permanent employment contract

The permanent employment contract may terminate following:

  • dismissal;
  • resignation;
  • retirement
  • death of the worker.

Dismissal

Dismissal is the cancellation of the employment contract resulting from an initiative by the employer. Dismissal is declared for personal or for economic reasons. The personal reason may relate to the employee’s physical or occupational lack of ability, or because of their misconduct. The economic reasons may relate to re-organization, reduction or termination of the work of the business or the establishment.

The dismissal procedure for personal reasons. The employer intending to dismiss an employee must first invite the person concerned to an interview, by registered letter, which must reach the employee five clear days at least before the interview. The letter inviting the person to the interview may also be delivered by hand. The invitation to interview sent by the employer or their representative specifies the date, time and place of the interview, the reasons for dismissal, the employee’s option to have assistance or to be represented by someone of their own choice, either from the company staff or from a trades union to which they may belong. During the interview, the employer or their representative may be assisted by a manager or an employee of the company. This person sets out the reasons leading to the possible dismissal and sums up the employee’s explanations as well as the arguments produced by the person assisting them. The discussion may never include reasons other than those noted in the letter of invitation to the interview. All company employees attending the meeting will be paid their normal rate for the working period concerned. Travel costs incurred by attending the interview will be met by the company. The employer may not take the decision to dismiss during the interview.

A minimum five-day period of reflection must be observed following the interview. When the employee does not attend, and is not represented at the interview, the employer is not obliged to arrange a new interview. The employer who decides to dismiss an employee must notify the person concerned by a letter delivered by hand; this letter may not be delivered until the fifth day following that of the interview and it must explicitly include the reason or reasons for dismissal. In the event of dispute, the employer is responsible for proving the true, valid reasons alleged for dismissal. While maintaining the obligation for the interview, the periods specified above may be reduced to 24 hours in the event of a serious fault. In this case, the staff representatives are obliged to attend the interview. The employer who has breached one of these procedural rules will be liable to pay the employee dismissed a sum equal to three months’ salary. This penalty may be added to that imposed because of wrongful dismissal.

The dismissal procedure for financial reasons. Any individual or collective dismissal based on economic reasons is subject to authorisation by the competent works inspector, even in the event of receivership or liquidation. However, when a company dismisses more than ten employees for economic reasons, it may not repeat this within a period of six months.

The works inspector has a maximum of thirty working days from the date the request is made for permission to implement the redundancy process to give the applicant their decision. Permission is granted automatically if the works inspector has not responded within the above thirty-day period, with the receipt for the request for permission to implement the dismissals providing proof of date. The decision given to refuse permission for partial or complete dismissal of staff must be supported by reasons.

The employer may only give the works inspector the request for individual or general dismissal for economic reasons after completing the procedure specified below.

The employer intending to implement individual or general dismissal of staff for economic reasons must provide the staff representatives, officials of the most representative trades union and members of the standing economic and social consultation committee with information about the proposed redundancies, especially:

  • the economic, financial or technical reasons for the planned redundancies
  • the number, occupational qualifications, nationality, period of service, age and family circumstances of the workers likely to be dismissed. This information must also be provided for similarly-qualified workers not included in the redundancy process
  • the measures planned to avoid redundancies or reduce the number involved on the one hand, and to help in relocating staff for whom redundancy is unavoidable on the other.
  • a social plan, and the funding for it, drawn up in accordance with the national employment office or other public employment department responsible on behalf of the employees for whom redundancy is inevitable. The employer only has to implement the social plan mentioned in the previous paragraph if a general redundancy programme implemented for economic reasons affects at least ten (10) employees. The total cost of this social plan shall not be greater than the total sum of wages owed by the employer. The employee may choose either the redundancy payment or compensation from the social plan. Staff representatives, union representatives and members of the standing economic and social consultative committee have eight working days to consider the redundancy programme submitted by the employer. After this period, the employer must meet the staff representatives, union representatives and members of the standing economic and social consultation committee. This consultation meeting must be recorded officially in a report which as well as opinions includes suggestions and proposals from the staff representatives, the members of the standing economic and social consultative committee and union representatives and the provisional schedule of redundancies.

The information in paragraph 1) above as well as the original copy of the consultation meeting report must be sent to the works inspector by the employer, at the same time as the written request for authorisation of the redundancies. The employees concerned are notified of their dismissal only after the works inspector’s decision, or failing that, after a period of 30 days as specified above. In the first instance, workers least qualified for the posts they hold may be dismissed, and in the cases of equivalent occupational qualifications, those employed most recently in the company, with their service increased by one year per dependent child. In the event of receivership or liquidation, the periods allowed for the above procedure are halved.

Workers dismissed for economic reasons may invoke their right to priority in employment for a period of one year if the company dismissing them reopens or creates new jobs in their specialist fields. 2) Resignation Article 61. Resignation is the worker’s own expressed desire to terminate the employment contract. It is never assumed. It must be notified explicitly in writing to the employer. The latter must acknowledge receipt within forty-eight hours of notification.

Retirement

Retirement is the cessation by the worker concerned of any paid work for reasons of age. It is initiated by the employer or the worker. The age limit varies from 55 to 60, depending on the sector of activity, and is determined by order made on a proposal by the employment minister, after recommendation from the Consultative employment commission. Under conditions specified by the Social security code, retirement gives the worker the right to an old age pension or old age allowance. The social security agency that has the power of enforcement on the employer is however jointly liable for the failure by the employer to pay its social security contributions. Hence if the employer and social security agency are responsible for the retiring worker being unable to claim an old-age pension or allowance, the social security agency is responsible for paying the retiring worker this allowance or pension, as specified under the terms of this Code, if the employer is insolvent. Other than the cases of retirement covered in the above paragraphs, and those specified in the social security code, the parties to the employment contract are free to agree the terms of early retirement, with the agreement of the social security agency.

Death of the worker.

If the worker should die, any salary owing, holiday allocation and remuneration of any kind earned up to the date of death, minus any contractual advances or deductions of the deceased party with respect to the employer, are owed by right to his/her heirs, who must provide evidence of their capacity. If a displaced worker should die in the workplace, or a member of his/her family whose travel costs were the responsibility of the employer should die, the employer must meet the cost of repatriating the body of the deceased to the latter’s usual place of residence as specified in the contract.

Medical

No worker may be accepted for a job before undergoing a medical examination for their suitability for employment.

National holidays

January 1: New Year’s Day

April 1: Easter Monday

April 17: Women’s Day

May 1: Labour Day

May 9: Ascension Day

May 20: Whit Monday

August 15: Assumption

August 16: Independence Day

August 17: Independence Day

August 8: Eid al-Fitr

October 15: Eid al-Adha

November 1: All Saints Day

December 25: Christmas Day

Working Hours in Gabon

The workday in Gabon is 8 hours with a 5-day work week.

Vacation in Gabon

Subject to more favourable contractual terms, the worker obtains the right to holidays from the employer, at a rate of two working days per month of actual service.

In general, employees are entitled to 24 days of paid annual leave. Leave time is increased according to the age of the employee, the length of time spent working at the company, and the employee’s family situation.

10 days of paid leave may be taken for family events.

Sick Leave in Gabon

Employees are entitled to up to 6 months of paid sick leave.

Maternity/Paternity Leave in Gabon

Female employees are generally entitled to 14 weeks of paid maternity leave: 6 weeks of leave prior to the birth and 8 weeks after.

Paternity leave is covered in the family allowance leave. See vacation.

Termination/Severance in Gabon

Probationary periods may not exceed 6 months.

Generally, employees must be notified of termination according to the following schedule:

less than 1 year of service: 15 days

1 to 3 years of service: 1 month

3 to 5 years of service: 2 months

5 to 10 years of service: 3 months

10 to 15 years of service: 4 months

15 to 20 years of service: 5 months

20 to 30 years of service: 6 months

Above 30 years, an increase of 1 day per year of length of service is granted.

Health Insurance in Gabon

Gabon has national fee for service health care. While maternity care and medicine are free, employees must pay a portion of other medical services according to a schedule in the employment law.

Employer of Record for Gabon Africa

Although an Employer of Record often works with a staffing agency, the two are separate business entities. Each has specific roles and responsibilities in their symbiotic relationship. We Handle Employer of Record and Payroll throughout Africa.

Purpose

An employer of record serves as an employer for tax purposes while an employee performs work for the client, such as a staffing firm or other business. An employer of record handles all personnel functions, including payroll processing and funding; tax deposits and filing; and employment contracts and paperwork. Maintaining a Certificate of Insurance, and Verification forms; unemployment insurance; and workers’ compensation are done. An employer of record also performs background checks and drug screenings; administers benefits; terminates employees; and may handle worker issues. Conversely, a staffing firm recruits employees and assigns them to businesses for worker absences, temporary skill shortages, seasonal work, or special projects. Their main focus is to match temporary, temp-to-hire, long-term, or permanent workers with clients in need.

Benefits

Using an employer of record allows the client company to free up time and cost-effectively outsource its necessary human resource functions, employee benefits, payroll, workers’ compensation, and compliance issues. The money saved by outsourcing these functions can be used to expand the business, provide steady income for the owner, or fill a variety of other purposes. Onboarding quality talent is done quickly by an employer of record so clients can quickly ramp up staff and staffing agencies can deliver top quality workers to their clients. Most staffing agency owners don’t have the HR training, payroll and accounting skills, compliance knowledge, or risk management, insurance, and employee benefits background to meet the demands of being an employer.

Responsibilities and Liabilities

The client company or staffing agency owner retains control over business operations and responsibility for workplace safety and compliance. The employer of record assumes responsibilities and liabilities for employment issues such as administration, payroll, taxes, benefits, and maintaining employee records. Because the employer of record assumes most of the responsibility for compliance and tax laws, the client or staffing services owner receives peace of mind, knowing their business is being taken care of by qualified professionals.

Whereas an employer of record and staffing agency often work together, they have diverse purposes in the workplace.

http://www.china-invests.net/Gabon/GSEZ/Labor_Law_in_Gabon.pdf

http://www.china-invests.net/Gabon/GSEZ/Labor_Law_in_Gabon.pdf

http://epri.org.za/wp-content/uploads/2016/07/19-Gabon.pdf

https://www.ilo.org/dyn/eplex/termmain.showCountry?p_lang=en&p_country_id=119

https://www.who.int/bulletin/volumes/91/5/13-020513/en/