Overview
Payroll Cycle
Employer Contributions
Employee Contributions
Minimum Wage
Hiring
Hiring Employees
Hiring Contractors
Hiring Expats
Background Checks
Employment Contracts
Onboarding
Employee Benefits
Social Security
Healthcare and Insurance
Leave Policy
Public Holidays
Work Permit and Work Visa
Probation Period
Notice Period
Termination and Severance
Personal Income Tax
An Employer of Record in Uganda provides comprehensive support in various areas, including managing the payroll cycle, ensuring compliance with employer and employee contributions, adhering to minimum wage regulations, facilitating the hiring process for employees, contractors, and expatriates, conducting background checks, drafting employment contracts, assisting with onboarding procedures, administering employee benefits, overseeing social security programs, coordinating healthcare and insurance coverage, managing leave policies, accounting for public holidays, facilitating work permit and work visa processes, overseeing probation periods, notice periods, termination, and severance procedures, as well as providing guidance on personal income tax obligations.
| Overview | |
| Continent | Africas |
| Country | Uganda |
| Capital | Kampala |
| Time zone | UTC+03:00 (EAT) |
| Total Time zones | 1 |
| Working hours per week | 48 |
| Working week | Monday–Saturday |
| Typical hours worked | 8 |
| Personal Tax filing deadline | December. Within six months of the end of the year of income. |
| Financial Year | 1 July – 30 June |
| Date format | dd/mm/yyyy |
| Currency | Ugandan Shilling (UGX) |
| VAT | the standard rate is 18% |
Employer Payroll Contributions in Uganda
| Employers | % of Gross Salary |
| Social Security | 10% |
| Total Employment Cost | 10% |
Employee Payroll Contributions in Uganda
| Employees | % of Gross Salary |
| National Security Fund | 5% |
| Total Employee Cost | 5% |
Minimum Wages in Uganda
| Minimum Wage | |
| Minimum Wage | The minimum wage in Uganda is 6000 UGX per month. |
Payroll Cycle in Uganda
| Payroll | |
| Payroll Cycle | Bi-Weekly, Monthly |
| 13th Salary | There are no provisions in the law regarding 13th salaries. |
Personal Income Tax in Uganda
| Income Tax | |
| Taxable Income | Tax Rate |
| Up to 2,820,000 UGX | 0% |
| 2,820,001 - 4,020,000 UGX | 10% |
| 4,020,001 - 4,920,000 UGX | 20% |
| 4,920,001 - 120,000,000 UGX | 30% |
| Over 120,000,001 UGX | 40% |
Employment Contracts and Policies
Employment Contracts
While written employment agreements are common, they are not mandatory. However, certain minimum terms must be provided to employees in writing within 12 weeks of starting their employment. These terms include:
- Full names and addresses of the contracting parties
- Start date of the employment and the employee's period of continuous service
- Job title and place of work
- Wages, payment intervals, and any applicable deductions or conditions
- Overtime pay rate
- Normal working hours and scheduled shifts
- Annual leave entitlement
- Terms and conditions regarding sickness or injury, including provisions for sick pay
- Notice period required for termination by the employer or employee, beyond the minimum provided by the law
Probationary Periods
Probationary periods are allowed and have a statutory limit of 6 months. With the employee's consent, this period may be extended for an additional 6 months. Typically, probationary periods range from 3 to 6 months.
Policies
Certain policies are mandatory depending on the size and nature of the organization. These include:
- A written occupational health and safety policy for workplaces with at least 20 workers
- A sexual harassment policy for employers with more than 25 employees
- A disciplinary and grievance policy for all employers
The content and format of the disciplinary and grievance policy may vary based on the organization's characteristics. It is possible to reference these policies in the employment contract.
Third-Party Approval
There is no requirement to submit employment contracts or policies to any third party for approval or registration.
Employment Options and Policies
Employee
Employees, whether they have indefinite or fixed-term contracts, work full-time or part-time, are entitled to protection against discrimination. Factors such as a significant level of control over the individual, provision of necessary tools and training, and the individual's work being an integral part of the business indicate an employment relationship. Casual employees can only be engaged for a maximum of 4 months.
Independent Contractor
Companies have the option to directly engage independent contractors or utilize the services of a personnel services company. It is important to properly classify independent contractors to avoid misclassification issues. Payments made to independent contractors are subject to a 6-percent withholding tax, unless the engagement is with a foreign company, in which case no tax withholding obligation applies. However, the independent contractor is still responsible for paying the applicable taxes.
Agency Worker
The utilization of agency workers is common. It is mandatory for the agency to possess a valid recruitment permit.