Employer of Record in Mauritius: Hire Employees in Mauritius Without a Local Entity

What Are the Employee Benefits in Mauritius?

Employee benefits in Mauritius are governed by The Workers’ Rights Act 2019 along with The Employment Relations Act 2008. These laws establish the minimum standards for employee entitlements, including wages, working conditions, leave benefits, employee protections, and other statutory rights.

Employers must provide these mandatory benefits, although employment contracts or collective agreements may offer more favorable benefits than those required by law.

Whether using a reputable employer of record Mauritius solution or hiring directly, it’s important to understand these legal requirements:

1. Employment Contracts in Mauritius

Employment contracts can be either fixed-term or indefinite, depending on the nature of the role and business needs. These contracts take effect when the employee officially begins work in Mauritius and are closely tied to the issuance of a work permit—something the employer must obtain on the employee’s behalf.

When hiring employees in Mauritius, you must provide a written employment contract. This document should clearly outline the employee’s job responsibilities, salary, working hours, benefits, and conditions for termination.

2. Wages

The statutory minimum wage in Mauritius is Rs 17,745 (approximately US$382) per month for full-time employees in the private sector. Based on the standard 45-hour workweek, this is equivalent to approximately Rs 102 per hour.

Employers are also required to implement annual pay increases that meet or exceed government-mandated adjustments. Each employee must receive a detailed payslip, and only legally approved deductions can be made from their salary.

3. Working Hours and Rest Days

a. Working Hours
The standard workweek in Mauritius is 45 hours. This is typically structured as nine hours per day over five days, or eight hours per day over five days with five hours on one additional day. Employees cannot be required to work more than 12 hours in a single day.

b. Rest day
Employees are entitled to at least 24 consecutive hours of rest each week, usually on Sunday. In businesses that operate seven days a week, employees must receive at least two Sundays off per month.

c. Overtime Rules
Overtime worked on weekdays must be paid at 1.5 times the employee’s regular hourly rate. Work performed on public holidays must be paid at double the regular rate. Employers are also required to provide prior notice before requesting employees to work overtime.

4. Leave Entitlements

Workers are entitled to several types of paid leave:

• Annual Leave: Employees receive 22 paid vacation days annually after one year of service,
• Sick Leave: Workers are entitled to 15 days of paid sick leave per year, supported by a medical certificate for absences beyond three days.
• Maternity Leave: Female employees are entitled to 14 weeks, with at least 7 weeks taken after childbirth.
• Paternity leave: 5 days per year.
• Special Leave: 6 days per year, used for exams, medical appointments, and other valid reasons.
• Bereavement Leave: 3 paid days for the death of a close family member.
• Cyclone and Weather: In cases where a Class III or IV cyclone warning is issued, workers who are unable to report to work are entitled to paid leave for the duration of the warning. Those who do report to work under such conditions are compensated at three times their hourly wage and must also be provided with meals during their shift.
• Mauritius Public Holidays: Mauritius observes 15 public holidays, and employees are entitled to pay for those days.

5. Taxes in Mauritius

These cover corporate taxes, income tax, and mandatory social security contributions. Both employers and employees must comply with the country’s tax system and statutory deductions.

Below is a simplified breakdown of the main obligations.

• Tax Year: The Mauritian fiscal year runs from July 1 to June 30.
• Payroll Tax (PAYE): Annual chargeable income is taxed at 0% on the first Rs 500,000, 10% on the next Rs 500,000, and 20% on any remaining income.
• Corporate Tax: Export-oriented companies pay 3%, while most other businesses are taxed at 15%.
• Social Security Contributions (Employees): Employees contribute 1.5% of their salary if their monthly earnings are up to MUR 50,000, and 3% if their monthly earnings exceed MUR 50,000.
• Social Security Contributions (Employers): Employers must contribute 2.5% of each employee’s pay.
• Employee Income Tax: Annual income above MUR 650,000 is taxed at 10% or 15%, depending on the bracket.
• Value Added Tax (VAT): Most goods and services carry a 15% VAT rate.
• Dividends: Dividend payments are tax-exempt in Mauritius.
• End of Year Bonus: Employees are entitled to an End of Year Bonus, equivalent to one month’s salary (or 1/12 of yearly earnings), payable in December. This applies to permanent and fixed-term workers who have completed at least 8 months of continuous service.

An employer of record Mauritius ensures that all taxes, social contributions, and withholdings are calculated correctly and submitted on time. This reduces compliance risks and allows businesses to focus on operations while the EOR handles payroll, employee benefits, and statutory reporting.

6. Probation and Termination of Employment in Mauritius

a. Probation Period
The standard probation period in Mauritius ranges from one to three months, depending on what is stated in the employment contract. During this time, both parties evaluate whether the employment arrangement is a good fit.
b. Termination of Employment
Termination can be initiated by either the employer or the employee and becomes effective on the mutually agreed-upon date. An employee may consider their employment contract terminated by the employer if any of the following occurs:

• Non-payment of wages – The employer fails to pay the employee’s salary as agreed in the contract.
• Abusive treatment – The employee is subjected to harassment, mistreatment, or any form of unfair or hostile behavior by the employer.
• Forced resignation – The employer pressures or coerces the employee into signing a resignation letter against their will.

In such cases, the employee may have grounds to bring a legal claim against the employer.
c. Notice Period in Mauritius
The notice period required before terminating an employee depends on the length of their service:

• Up to 1 year: Minimum 1 week’s notice
• More than 1 year, up to 3 years: Minimum 2 weeks’ notice
• More than 3 years, up to 5 years: Minimum 3 weeks’ notice
• More than 5 years: Minimum 4 weeks’ notice

c. Exceptions to Notice Requirements

• Poor performance: Give the employee at least 7 days to respond to performance issues. Show that reasonable support and opportunities for improvement were provided before termination.
• Misconduct: Inform the employee of the alleged misconduct within 10 days of becoming aware of it. Give the employee at least 7 days to respond. Ensure all other possible corrective measures were considered before dismissal.
• Redundancy or business closure: Notify any recognized trade union, if one exists. If applicable, notify a representative trade union. If no union is involved, consult an elected employee representative.

Following these procedures ensures the termination is lawful and reduces the risk of legal disputes.

d. Severance Allowance in Mauritius

Severance pay in Mauritius is three months’ salary for each full year of continuous employment, with pro rata payment for incomplete years where applicable.
The monthly salary used for this calculation is the higher of the following two:

• The salary for the last full month of work
• The average monthly pay over the past 12 months, including overtime, productivity bonuses, attendance bonuses, commissions, and any other regular payments

Any gratuities, employer contributions to pension or other funds, and contributions to the Portable Retirement Gratuity Fund (PRGF) can be deducted from the final severance amount.

7. Non-Statutory Benefits

• Health coverage and insurance

Employers must insure workers for work-related injury, illness, or death, and many also provide private health insurance alongside public healthcare.

• Transport and safety

Free transport or travel allowance is provided if the commute is over 3 km or public transport is unavailable. Safe transport must be ensured, including emergency transport when required.

8. Workplace Safety Requirements

• Cleanliness and living standards

Any employer-provided housing must be clean, sanitary, and properly maintained with proper waste disposal and hygiene standards.

• Protective equipment and safety

Employers in high-risk sectors such as construction or manufacturing must provide protective gear like helmets, gloves, boots, and safety equipment.

• Safe working conditions

Employers must ensure a safe working environment and comply with occupational health and safety standards.