Hire Employees in the Solomon Islands

Two routes exist. Registering a Solomon Islands entity gives you direct employment and permit sponsorship, followed by registration with the Inland Revenue Division and the SINPF Board.

An Employer of Record removes that setup. The EOR is the legal employer, runs payroll, remits SINPF and withholds PAYE, while day-to-day direction stays with you.

Two deadlines bite early. Every employer must register with the SINPF Board within 14 days after commencement of business operations, and must register each employee within 14 days of commencement of employment.

The economy runs on logging, fisheries, minerals, subsistence agriculture and a growing public sector, with international employment concentrated in resources, development and technical assistance.

Employer contributions are 7.5% to the National Provident Fund, with 5% from the employee. There is no separate unemployment insurance, which keeps the headline burden modest by regional standards.

The SINPF is worth naming precisely, because it has been misattributed elsewhere. A global provider publishes the Solomon Islands National Provident Fund on its Seychelles page, at 10% employer plus 10% social security. Neither the country nor the rate is right: the fund belongs here, and the employer rate is 7.5%.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a local entity somewhere between 12 and 20 employees, though permit access often matters more. Model both, see EOR vs Entity for the framework.

The employer contributes 7.5% and the employee 5% to the Solomon Islands National Provident Fund, a compulsory defined-contribution savings scheme.

Liability starts at a very low threshold. An employer becomes liable to pay monthly contributions after hiring an employee for six or more days who is paid SBD 20.00 or more in a month. Short and casual engagements are therefore inside the scheme, not outside it.

The contribution base is disputed and the sources do not agree. One publisher describes it as basic wage on its payroll page and basic salary and overtime on its EOR page, while another gives gross salary. The same publisher also states that all overtime is treated as ordinary wages for SINPF purposes. Confirm the base with the SINPF Board before running payroll, the difference is material wherever overtime is significant.

Remittance is due by the 15th of the month following the payroll period, with a 2% surcharge if late.

The employee contribution is tax-deductible, reducing taxable income and partially offsetting the deduction.

Note that the governing statute is cited as the NPF Act Cap 109 by the Fund itself and as Cap. 128 by one provider, the Fund’s own citation should be preferred.

Gross monthly salaries in the Solomon Islands dollars. Employer contributions are uncapped at 7.5%.

Benchmarks below are gross monthly salaries in the Solomon Islands dollars. Employer contributions are 7.5% with no ceiling.

Payroll is monthly, with salaries usually paid by month end. Some employers pay fortnightly. Payslips must be issued each period showing basic salary, NPF contributions, income tax and any allowances or deductions.

PAYE is progressive. The structure runs from nil on the first band, then 11%, 23% and 35%, administered by the Inland Revenue Division under the Income Tax Act. One source gives a top rate of 40% rather than 35%, confirm the current top band with the IRD before configuring payroll.

Employers calculate, withhold and submit tax on behalf of employees, and maintain records for annual reconciliation.

SINPF contributions are remitted separately to the Fund by the 15th of the following month.

Progressive PAYE bands administered by the Inland Revenue Division. Note the conflict on the top rate and confirm current thresholds with the IRD.

Employment is governed by the Labour Act (Cap. 73) and the Employment Act (Cap. 74), with the Workmen’s Compensation Act applying to workplace injury.

The standard working week is 45 hours across nine-hour days, five days a week. Overtime is payable at 1.5 times the regular rate beyond normal hours and 2 times for work on public holidays.

Written contracts are required for engagements exceeding three months.

The minimum wage is published at two different levels by the same provider, which is worth resolving before you make an offer. Its EOR page gives SBD 8.00 an hour for most sectors and SBD 7.20 for agriculture, plantations and fishing, both in force since 1 August 2019 under the Unskilled Workers (Minimum Wages) Order. Its work visa page gives SBD 4.00 an hour, half as much. Confirm the current Order before contracting.

Youth workers, domestic workers in private households and certain agricultural piecework arrangements sit outside the standard minimum wage.

Written contracts are required for engagements exceeding three months and must comply with the Labour Act.

Register with the SINPF Board within 14 days of commencing operations, and register each employee within 14 days of their employment starting.

Confirm the contribution base and the applicable minimum wage before the first payroll run, since both are disputed in published guidance.

The standard week is 45 hours across nine-hour days. Overtime is 1.5 times the regular rate, rising to 2 times on public holidays.

Overtime treatment is the crux of the contribution base question. One source states that all overtime is treated as ordinary wages for SINPF contributions and income tax withholding; another describes the base as basic wage only. Where overtime is routine, that difference changes employer cost materially.

Because contributions are uncapped, overtime attracts the full 7.5% wherever it falls within the base.

Solomon Islands observes national and Christian public holidays, including Independence Day in July. Provincial second appointed days vary by province.

Solomon Islands observes national and Christian public holidays, including Independence Day in July. Provincial second appointed days vary by province. Dates and any substitution rules are set out below.

The National Provident Fund is the main element of the social security system, providing retirement savings rather than a state pension.

Members may access their accumulated balance on reaching retirement age or meeting other qualifying conditions.

There is no separate unemployment insurance, and no state health contribution, so the Fund carries most of the statutory weight.

Workplace injury is dealt with under the Workmen’s Compensation Act rather than through the Fund.

Termination follows the Labour Act and Employment Act, with notice and any severance set by statute and contract.

Final pay including accrued leave is due on separation and must be reflected in the month’s SINPF remittance and PAYE filing.

Contribution arrears attract a 2% surcharge and should be cleared before an exit rather than left to be reconciled afterwards.

Because liability attaches from six days of work and SBD 20 of pay, even a very short final engagement can carry a contribution obligation.

SINPF is mandatory for all employees including foreign nationals, unless they are exempt under a bilateral social security agreement. There is no automatic expatriate exemption.

A work permit is required and is employer-sponsored, and a Labour Market Test applies alongside SINPF registration as the main prerequisite.

Most foreign specialist roles command salaries well above the statutory minimum, so the wage floor is rarely the binding constraint, the permit process is.

The contribution base is disputed across sources. Basic wage, basic plus overtime, and gross salary are all published. Confirm with the SINPF Board, because the difference is material wherever overtime is routine.

The minimum wage is published at two levels by the same provider. SBD 8.00 and SBD 4.00 an hour. Using the lower figure would produce an unlawful offer.

The 14-day registration deadlines are easy to miss, both for the employer on commencing operations and for each employee on starting.

Note also that the employer definition extends to a contract for service, which reaches some contractor arrangements; that liability starts at six days and SBD 20; and that the top tax rate is published as both 35% and 40%.

Work backwards from the start date. An EOR hire takes three to six weeks; a work permit adds the Labour Market Test.

Confirm the contribution base and the minimum wage before quoting, both are published inconsistently.

Register with the SINPF Board and enrol the employee within 14 days each, diarise the 15th for remittance to avoid the 2% surcharge, and check whether any contractor arrangement falls inside the employer definition.