Definitive Guide to Hiring in Sao Tome and Principe

Hiring in Sao Tome and Principe

Hiring employees compliantly in Hiring in Sao Tome and Principe means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Sao Tome and Principe so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Hiring in Sao Tome and Principe; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Labor Laws in Sao Tome and Principe

Employment laws in Hiring in São Tomé and Príncipe dobra are uniquely suited to the country’s way of life, and crucial to understand if you want to employ local talent in this country. Get the details on Hiring in São Tomé and Príncipe dobra employment laws and Hiring in São Tomé and Príncipe dobra policies here.

Employee Probation Period

• Probation is capped at 6 months

Annual Leave in Sao Tome and Principe

• Employees receive 30 days of paid annual leave

Holidays in Sao Tome and Principe

Maternity Leave Sao Tome and Principe

• Female employees receive 60 days of paid maternity leave

Paternity Leave Sao Tome and Principe

• There is no paternity leave

Sick Leave in Sao Tome and Principe

• The Labor Code does not stipulate the duration of sick leave.
• However, it states that sick leave is a form of justified absence.
• According to the Labor Code, a form of justified absence includes: -
  • Those motivated by the impossibility of proving work due to a fact that is not attributable to the employees, namely illness, accident, or fulfilling legal obligations.

Working Hours in Sao Tome and Principe

• The standard work week is 8 hours/day and 45 hours/week

Overtime in Sao Tome and Principe

• Overtime work shall be compensated in the following way:
  • 25% of the regular wage in the first hour of overtime work
  • 50% of the regular wage in the following hours or fractions of hours of overtime work.

Termination of Employment in Sao Tome and Principe

• Notice period is of 1 month
• Severance is typically a month’s salary for each year of service

Notice Period in Sao Tome and Principe

• Notice period is as follows:
  • 1 month (if the length of employment is less than 3 years)
  • 2 months' notice period (if the length of employment is greater than 3 years)

Severance in Sao Tome and Principe

• The payment amount in this case and for dismissal on economic grounds is a lump sum of 100% of the employees' last monthly earnings multiplied by the number of years of continuous employment.
• The minimum payment amount is three times the employee's last monthly earnings.

Sao Tome and Principe Salary and Wages

13th / 14th Month Salary in Sao Tome and Principe

• No
• There is no statutory requirement to pay the 13th or the 14th month salary.
• Employees receive annual leave of 26 days at the standard rate.

• Nonresidents are subject to PIT on gross income derived in STP. 
• This income is subject to a final withholding tax of 15%.

Immigration Sao Tome and Principe

• Temporary visas may be granted to foreign citizens to engage in, among others, cultural, study, sports or business activities (to the extent that a work visa is not required for such activities).
• A multiple-entry visa is valid for 180 days, while the single-entry visa is valid for 30 days.
• No specific work visa is issued in STP. 
• Foreign citizens must obtain a residence visa to be able to work in STP (either as dependent or independent workers).
• On request, yearly residence visas may be granted to foreign citizens. 
• After final approval, the residence visa is valid for one year, with the possibility of renewals for equal periods.

Value Added Tax (VAT) in Sao Tome and Principe

• Finance Minister Osvaldo Vaz stated the VAT Code bill, which will come into force in January 2021, aims to modernize the São Tomé tax system and will be operated exclusively on a computer platform, in line with IMF and World Bank recommendations.
• The proposed standard VAT rate is 10%

Mandatory Benefits in Sao Tome and Principe

• These are mandatory benefits as postulated by law
• These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity leave, overtime pay, notice period.
• Statutory benefits also include social security benefits

Payments And Invoicing

• Income included in Categories A, B (only Group 2) and D (if the individual chooses to aggregate this income) must be declared through the submission of a tax return by the end of February of the following year. 
• Income included in Group 1 of Category B must be declared by the end of April of the following year. 
• The following individuals are not required to file a tax return: 

• • Individuals who only received income included in Category A that is subject to withholding tax from a single entity 
  • Individuals subject to the final withholding tax rate 

• The tax payable, reduced by withholding tax, must be paid by the end of September of the year in which the return is submitted. 
• In accordance with the provisions of the CIT Code, individuals with income in Category B are required to make three advance payments (in June, September and December), in an amount corresponding to 75% of the tax payable for the preceding year. 
• These advance payments may be waived in certain conditions. 
• Any excessive advance payments result in a refund at the end of the year.

Payroll Accrual in Sao Tome and Principe

Country Accruals Additional Information

Description Coverage

Employed persons, including civil servants and military personnel; and household workers.Exclusions: Self-employed persons

Payroll Accruals Additional Information

Accrued Benefits in Sao Tome and Principe

Why use Global Expansion to hire in Sao Tome and Principe

Establishing a branch office or subsidiary in Sao Tome and Principe can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Sao Tome and Principe labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Sao Tome and Principe law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Sao Tome and Principe. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Sao Tome and Principe Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.