New rules take effect for foreign employees in Angola
THE GOVERNMENT of Angola recently enforced new rules governing the hiring of foreign employees that are expected to impact South African businesses.
CRS Technologies, a services and solutions provider focused on human resources and human capital management, advised South African businesses to take cognisance of these rules and their possible impact on operations.
CRS identified the most critical of these rules, those that were the most applicable to the hiring of non-resident foreign workers in Angola. The rules include: The regulation now allows the non-resident foreign employee and the employer to freely establish the duration of the agreement, which may be renewed twice, in accordance with the legislation in force. Previously, there was a limit of 36 months on the maximum duration.
The value and currency of remuneration may be freely agreed between the employer and employee. Previously, payment of remuneration had to be the Angolan kwanza.
The new regulation eliminates the prohibition of benefits and supplements paid directly or indirectly in cash or kind, in an amount exceeding 50 percent of the basic salary.
The payment of the employee’s remuneration in foreign currency must be made through a financial institution.
The company said, with the advent of technology and regulation geared towards more relaxed trade, it believed that Africa was becoming more open and more accessible to entrepreneurs and innovators.
CRS’s general manager, Ian McAlister, said: “Businesses are mushrooming and technology is offering previously inaccessible opportunities to a broader base of companies that want to do business, and tap into relatively new markets, including Angola.”
CRS further explained in a brief Q&A with Business Report:
BR: How exactly does the Angolan labour law impact South African businesses?
CRS: South African businesses that second employees to Angola will be able to extend the duration of the contract, only being restricted in terms of the amount of times it may be extended, which is twice. Therefore they will no longer be restricted with the 36-month limit.
In terms of remunerating these individuals, they have the option of being remunerated in either kwanza or their respective currency chosen. Although the employer should still keep in mind that there must be a “cost of living” calculation evident in structuring the salary, there could be a reduction in bank costs for these businesses, if for example they paid the employees in rand.
BR: Does it mean we will see a mass migration of skilled South Africans to Angola?
CRS: This is possible, as the limits to fringe benefits and allowances have been relinquished, allowing the possibility of increased earnings in terms of these allowances and fringe benefits.
BR: Does this new regulation make South Africa less attractive for skilled migrant workers?
CRS: Not necessarily. South Africa still provides attractive employment for skilled migrant workers in terms of compensation on skill grade.
BR: Wouldn’t this actually turn out to be a relief to workers who might face retrenchment and some companies that are starting to feel the effects of the country’s downgrades?
CRS: We can but only speculate in terms of whether the new regulations are a relief to certain individuals and companies, respectively. It comes down to being a double edged sword, where relief and burden may weigh the same at the end of the day.
CRS provides a service to African countries, including Egypt, Kenya, Nigeria, Namibia, Botswana, Swaziland, Lesotho and Mozambique.
‘Businesses are mushrooming and technology is offering previously inaccessible opportunities.’