Definitive Guide to Hiring in Yemen‌

Hiring in Yemen

Hiring employees compliantly in Yemen means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Yemen 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 Yemen; or

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

Labor Laws in Yemen

Employee Probation Period

• Upon signing a contract of employment a worker may be subject to a probationary period not exceeding six months with the same employer, to be stipulated in the contract.

Annual Leave in Yemen

• Workers shall be entitled to leave of not less than 30 days with full pay for each year of effective service, to be calculated on the basis of at least two-and-a-half days for each month.

Holidays in Yemen‌

Maternity Leave Yemen

• A pregnant worker shall have the right to maternity leave with full pay for 70 days.
• A pregnant worker shall be granted a further 20 days' leave, in addition to the days in the following cases:
  • if her labor was difficult as established by a medical report,
  • if she gives birth to twins.
• Pregnant Workers are paid their full wages (100%) during the term of maternity leave, i.e., 70 days to maximum 90 days. Maternity leave is paid by the employer.

Paternity Leave Yemen

• There is no paternity leave

Sick Leave in Yemen

• In case of sickness, workers shall be entitled to continuous or non-continuous sick leave on the following basis:
  • sick leave with full pay for the first and second months of sickness;
  • sick leave with 85 per cent of wages for the third and fourth months of sickness;
  • sick leave with 75 per cent of wages for the fifth and sixth months of sickness;
  • sick leave with 50 per cent of wages for the seventh and eighth months of sickness.

Working Hours in Yemen

• Official working hours shall not exceed eight hours per day or 48 hours per week.
• Weekly hours of work shall be distributed over six working days followed by one day of rest with full pay.
• Official working hours during the month of Ramadhan shall not exceed six hours per day or 36 hours per week.

Overtime in Yemen

• Any worker employed over time shall regardless of his occupation, be entitled to compensatory rest periods with pay calculated on the basis of the following rates:
  • one-and-a-half times for overtime on normal working days;
  • double time for overtime night work
• Working hours, whether normal or overtime shall not exceed 12 hours per day.

Termination of Employment in Yemen

Either party to a contract of employment may terminate the contract, provided that the party wishing to do so shall notify the other, in any of the following cases:

• • if one of the parties fails to observe the terms of the contract or labor legislation;
  • if work permanently ceases, either entirely or in part;
  • if there is reduction in the number of workers for technical or economic reasons;
  • if the worker absents himself without legitimate reason for more than 30 days within the same year or for 15 consecutive days, provided that termination of contract is preceded by a written warning from the employer after 15 days of absence in the former case and seven days in the latter;
  • if the worker reaches statutory retirement age;
  • if the worker is declared unfit to work by decision of the competent medical committee.
• If a contract is terminated by one of the parties thereto in accordance with article 36, the party wishing to terminate the contract shall give the other party prior notice of termination equivalent to the period prescribed for the payment of wages or pay the wage for such period in full in lieu of notice.
• If either party refuses to receive notice of termination of the contract, the notice may be deposited with the Ministry or one of its offices.
• The period of notice provided is calculated as follows:
  • 30 days for workers with monthly wages;
  • 15 days for workers with half-monthly wages,
  • one week for workers working on the basis of production or piece work, or hourly or daily or weekly rates.

Notice Period in Yemen

• If a contract is terminated by one of the parties thereto in accordance with article 36, the party wishing to terminate the contract shall give the other party prior notice of termination equivalent to the period prescribed for the payment of wages or pay the wage for such period in full in lieu of notice.
• If either party refuses to receive notice of termination of the contract, the notice may be deposited with the Ministry or one of its offices.
• The period of notice provided is calculated as follows:
  • 30 days for workers with monthly wages;
  • 15 days for workers with half-monthly wages,
  • one week for workers working on the basis of production or piece work, or hourly or daily or weekly rates.

Severance in Yemen

• Severance pay is as follows:-
  • 1 month's pay for each year of completed service where employees are not entitled to monthly pension or a lump-sum payment
  • 6 months wages in case of termination due to misconduct of employer

Yemen Salary and Wages

13th / 14th Month Salary in Yemen

• No
• There is no statutory requirement to pay the 13th or the 14th month salary.
• Employees receive a generous 30 days annual leave and they are allowed to carry half of it to the following year.

• The employer must contribute 9% of a national or foreign employee's salary to the General Corporation for Social Security (GCSS)
• An employee (whether a national or foreigner) must contribute 6% of salary to the GCSS.
• A foreign employee may withdraw the total contribution paid by the employee and the employer to the GCSS, subject to a deduction of 20% as a service charge.
• (Changes were made to these rules in 2017, but due to the ongoing political crisis, the GCSS continues to collect the contributions under the old rules.)

Immigration Yemen

• Foreigners must obtain appropriate visas to enter the country
• The main Yemen visas are: -
  • Student visa
  • Business visa
  • Tourist Visa
  • Transit Visa
  • Diplomatic/Official visa

Value Added Tax (VAT) in Yemen

• Yemen operates a General Sales Tax (GST) system
• The general rate is 5%.
• Although, a 10% rate applies to telecommunications and mobile communications services
• Exemptions are also available

Mandatory Benefits in Yemen

• 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

Payroll Accrual in Yemen

Payroll Accruals Additional Information

Accrued Benefits in Yemen

Why use Global Expansion to hire in Yemen

Establishing a branch office or subsidiary in Yemen 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 Yemen labor laws are complex.

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

Global Expansion makes it easy for you to expand into Yemen. 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 Yemen 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.