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Hiring in Grenada
Grenada is an island country in the Caribbean. St. George's is the capital and the largest city of Grenada. Grenada is a small economy and tourism is a major sector of the country. Agriculture is another key sector of the economy, whereby Grenada exports nutmeg, cocoa, bananas, and fruit. Its main trading partners are Nigeria, St Lucia, Antigua and Barbuda and the United States. Global PEO or Employer of Record (EOR) play a pivotal role in providing companies with services related to hiring employees, and ensuring compliance with Grenada’s legal and tax regulations. Employment regulations including probation, holidays and termination are covered by the Labor Code. Labor Code stipulates that employees are entitled to 2 weeks of annual leave. Income tax is imposed on a progressive rate of 10% to 28%. Global PEO’s or Employer of Record (EOR) facilitate companies by ensuring compliance with Grenada’s Labor Code and tax laws.
statutory labor requirements
Probation Period
- In contract of employment which do not specify the length of the probationary period, the following probationary periods shall be deemed to apply:
- not more than one month in the case of unskilled workers;
- three months in the case of other workers, but which period may be extended by a collective agreement.
Annual Leave
- Except where otherwise provided for in this Act, every agricultural worker, catering assistant, clerical assistant, construction worker, domestic worker, industrial worker, security guard and shop assistant shall be entitled to a period of annual leave with pay of not less than the following:
- two weeks for the first year of employment;
- three weeks thereafter.
Public Holidays
- New Year's Day (1st January)
- Independence Day (7th February)
- Good Friday (10th April)
- Easter Monday (13th April)
- Labor Day (1st May)
Maternity Leave
- An employee shall be entitled under this Act to maternity leave for a period of three months, with maternity pay calculated and paid.
- In any case where the child of an employee dies at birth, or within one month thereof, her entitlement to maternity leave with maternity pay shall cease thirty days after the death of the child.
Paternity Leave
- There is no paternity leave
Sick Leave
- After not less than twelve months’ continuous service, an employee shall be eligible for paid sick leave on the production of a medical certificate from a registered medical practitioner stating the nature and expected duration of the employee's incapacity.
- During sick leave, an employee shall be paid at the normal rate of wages less any amount to which the employee is entitled as a benefit by virtue of the National Insurance Act.
- An employer shall not be responsible to pay an employee for more than five occasions during a one-year period that he does not provide a medical certificate.
Work Hours
- No employer shall require any employee with the exception of shift workers in the under-mentioned categories to work for more than the hours prescribed hereunder during any week, excluding overtime:
- for an agricultural worker, a construction worker or an industrial worker, no more than forty hours with the ordinary working days being Mondays to Fridays;
- for a clerical assistant or a shop assistant, no more than forty-four hours with the ordinary working days being Mondays to Saturdays;
- for a catering assistant no more than forty-four;
- for a domestic worker, or security guard no more than sixty hours.
Overtime
- No employer shall require an employee to work overtime otherwise than pursuant to an agreement concluded between the employer and the employee.
- An employer shall pay to an employee who works overtime an amount calculated at a rate of not less than one and one-half times his wage for one hour in respect of the overtime worked, or twice his wage for one hour in respect of the overtime worked on a Sunday or public holiday.
Notice Period
- Subject to section 74, a contract for an unspecified period of time may be terminated by the employer after the probationary period, if any, upon giving the following minimum periods of notice in writing:
-
- one working day where the employee has been employed by the employer for less than one month;
- one week where the employee has been employed by the employer for one month or more, but less than three months;
- two weeks where me employee has been employed by the employer for three months or more, but less than one year;
- one month where the employee has been employed by the employer for one year or more, but less than five years;
- two months where the employee has been employed by the employer for five years or more.
- The minimum period of notice an employee shall give an employer is two weeks in the case where an employee has been employed for three months or for a longer period, and one month where the employee has been employed for one year or more.
Severance
- On termination at the initiative of the employer, an employee who has completed one year or more of continuous employment with his employer and who is not entitled to gratuity shall be entitled to be paid by the employer a termination allowance of not less than one week's wages for each completed year of service.
13th / 14th Month Pay
- No
- There is no statutory requirement to pay the 13th or 14th month salary.
- There is no evidence of any bonuses being paid.
income tax
- Resident individuals are taxed on their income derived from Grenada
- Nonresident individuals are taxed on income derived or sourced in Grenada
- An individual is considered resident if he/she is physically present in Grenada for at least 183 days in a fiscal year
- Taxable income includes employment and business income, less allowable deduction and allowances
|
Taxable Income (XCD) |
Rate |
|
1 to 24,000 |
10% |
|
24,001 and above |
28% |
deductible expenses
- A personal allowance of XCD 36,000 is granted
immigration
- Visa requirements for travel to Grenada are based on your country of citizenship.
- Permanent residents of the United States are not exempt from these visa requirements.
- A Grenada visa is not required for citizens of United States for a stay up to 90 days.
- British passport holders don't need a visa to visit Grenada.
- Similarly, citizens of many other countries such as Bulgaria, Cyprus, Greece, Ireland, Israel etc. do not require a Grenada visa.
- Citizens of non-visa exempt countries must apply for a tourist visa for short stay visits.
- A tourist visa has maximum validity of 90 days
- Grenadian businesses needing special or specific skills that are not available locally shall avail the Work Permit service, to bring skilled manpower from overseas.
- It is essential that the business demonstrates that local talent is not available towards fulfilling their needs.
- CARICOM nationals who have a Caribbean Skills Qualification Certificate or equivalent are exempt from having to apply for a work permit.
- They shall, however, obtain clearance from the Ministry of Foreign Affairs claiming that their skills match the requirements of the Caribbean Skills Qualification.
- Prerequisites for a work permit are as follows: -
-
- The business that desires to bring foreign skills has demonstrated that local talent is not available
- The business is in sound financial position and has met all its statutory needs towards the Government of Grenada
|
Type of Visa/Permit |
Documentation |
Validity |
Eligibility |
|
Tourist Visa |
|
90 days |
|
|
Work Permit |
|
1 year (renewable) |
|
value added tax
- VAT applies on the sale of goods or the supply of services within Grenada, and on the import of goods into Grenada
- The standard rate is 15%
- A reduced rate of 10% applies within the tourism sector and a 20% rate applies within the telecommunications sector
- Certain goods and services may be zero rate or exempt
|
VAT |
|
|
Higher Rate |
20% |
|
Standard Rate |
15% |
|
Reduced Rate |
10% |
|
Zero Rate |
0% |
withholding tax
Dividends
- Dividends are exempt from withholding tax
Interest
- Interest paid to a nonresident company or individual is subject to a 15% withholding tax rate
Royalties
- Royalties paid to a nonresident company or individual are subject to a 15% withholding tax rate
Fees for Technical Services
- Technical service fees paid to a nonresident company or individual are subject to a 15% withholding tax
|
Type of Payment |
Residents |
Nonresidents |
||
|
Company |
Individual |
Company |
Individual |
|
|
Dividends |
0% |
0% |
0% |
0% |
|
Interest |
15% |
15% |
15% |
15% |
|
Royalties |
15% |
15% |
15% |
15% |
|
Technical Service Fee |
15% |
15% |
15% |
15% |
termination
- The employment of an employee shall not be terminated by an employer unless there is a valid reason for such termination connected with the capacity or conduct of the employee or based on the operational requirements of the enterprise, or breach of contract of employment or disciplinary rules.
- Subject to section 74, a contract for an unspecified period of time may be terminated by the employer after the probationary period, if any, upon giving the following minimum periods of notice in writing:
-
- one working day where the employee has been employed by the employer for less than one month;
- one week where the employee has been employed by the employer for one month or more, but less than three months;
- two weeks where me employee has been employed by the employer for three months or more, but less than one year;
- one month where the employee has been employed by the employer for one year or more, but less than five years;
- two months where the employee has been employed by the employer for five years or more.
- The minimum period of notice an employee shall give an employer is two weeks in the case where an employee has been employed for three months or for a longer period, and one month where the employee has been employed for one year or more.
- On termination at the initiative of the employer, an employee who has completed one year or more of continuous employment with his employer and who is not entitled to gratuity shall be entitled to be paid by the employer a termination allowance of not less than one week's wages for each completed year of service.
statutory benefits
- These are mandatory benefits as postulated by law
- These include probationary period, annual leave, public holidays, sick leave, maternity leave, overtime pay, notice period, and severance pay
- Statutory benefits also include social security benefits
|
Statutory Benefits |
|
Probationary Period |
|
Annual Leave |
|
Public Holidays |
|
Maternity Leave |
|
Sick Leave |
|
Overtime Pay |
|
Notice Period |
|
Severance Pay |
|
Social Security Benefits |
payments and invoicing
- Tax year is the calendar year
- Joint filing is not permitted
- Individuals are required to file separately
- Tax returns must be filed by 31st March following the tax year, and the balance of tax is due upon the filing of the return
- A pay-as-you-earn (PAYE) system is used to deduct tax from the salaries of employees
- Interest of 1.5% applies each month the balance of tax due is outstanding
ease of doing business
- The ease of doing business index is an index created by Simeon Djankov, an economist at the Central and Eastern Europe sector of the World Bank Group.
- Higher rankings (a low numerical value) indicate better, usually simpler, regulations for businesses and stronger protections of property rights.
- According to the World Bank Grenada ranked 146th in the World in 2019 in terms of ease of doing business.
employee accruals
| Christmas Bonus% |
0% |
| Christmas Bonus Over Vacations % |
0% |
| Severance per Year % |
Employees are entitled to severance pay that equals to one week of pay after one year of service (1.37% of annual salary) |
| Vacations % | Employees are entitled to 10 days of paid leave a year (two weeks) (2.74% of annual salary) |
| Notice % |
Employees are entitled to 1 week of notice after one year of service (1.37% of annual salary) |
| Christmas Bonus Over Notifications% | 0% |
| Vacations Plus% | 0% |
| Total percentage of Salary (yearly) | The total employment accruals as a percentage of salary per anum are equal to 5.48% |
employer accruals
Employer Accruals Additional information
| Employment Accruals | ||
| Annual Leave | Except where otherwise provided for in this Act, every agricultural worker, catering assistant, clerical assistant, construction worker, domestic worker, industrial worker, security guard and shop assistant shall be entitled to a period of annual leave with pay of not less than the following: • two weeks for the first year of employment; • three weeks thereafter. |
This equals 3.84% (2/52 weeks) of annual income |
| Maternity Leave | An employee shall be entitled under this Act to maternity leave for a period of three months, with maternity pay calculated and paid. | This equals 25% (3/12 months) of annual income |
| Sick Leave | After not less than twelve months’ continuous service, an employee shall be eligible for paid sick leave on the production of a medical certificate from a registered medical practitioner stating the nature and expected duration of the employee's incapacity. | Subjective |
| Severance | On termination at the initiative of the employer, an employee who has completed one year or more of continuous employment with his employer and who is not entitled to gratuity shall be entitled to be paid by the employer a termination allowance of not less than one week's wages for each completed year of service. | This equals 1.92% (1/52 weeks) of annual income |
| Social Security |
Employers contribute at a rate of 5% | This equals 5% of annual income |
