Country Payroll Guide Ethiopia

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Key Facts

Addis Ababa
Date format
Ethiopian birr (ETB)
the standard rate is 15%



Social Security
Social Security - 11%
Total Employment Cost
Total Employment Cost - 11%


Social Security
Social Security - 7%
Total Employee Cost
Total Employee Cost - 7%

Minimum Wage

Minimum Wage

Ethiopia has no national minimum wage. Public sector employees earn a monthly minimum wage of 420 birr ($21).


Payroll Cycle
13th Salary

Not required by law.

Income Tax

Employee Income Tax (1)
0 - 600 ETB -0%
Employee Income Tax (2)
601 - 1650 ETB - 10%
Employee Income Tax (3)
1651 - 3200 ETB - 15%
Employee Income Tax (4)
3201 - 5250 ETB - 20%
Employee Income Tax (5)
5251 - 7800 ETB - 25%
Employee Income Tax (6)
7801 - 10900 ETB - 30%

Working Hours

General Working Hours

40 hours per week.


Overtime cannot exceed 20 hours in a month or 100 hours in a year.


Paid Time Off

For one year of service, employees are entitled to 16 days. Employees who have been employed with you for five years or more receive at least 18 days of leave with one extra day for every two years of service.

Public Holidays

14 days.

Sick Days
  • Six months of sick leave, paid at the following rates:
  • First month of leave: Full wages
  • Second and third month of leave: Half wages
  • Last three months of leave: No wage
Maternity Leave

Pregnant employees are entited to 120 fully paid days for maternity leave. 30 days should be taken prior to the due date and 90 days after.

Paternity Leave

Three days with full pay.

Parental Leave

There is no statutory paterental leave.


Termination Process

Written notice is required in the event of a termination, except for cases where misconduct or poor performance has been proven.

Notice Period

One to three months, depending on the length of service.

Severance Pay

Severance pay is calculated by the following rates:

  • 30 days’ wages for one year of service.
  • 10 days’ wages for every additional year of service after the first year (maximum of 12 months’ wages).
  • 60 days’ wages in addition to the above payments for workers who are terminated on grounds of redundancy.
Probation Period

No probationary period stated in the law.


Employment Visa

Foreign employees looking to work in Ethiopia are required to have a work visa.