Ultimate Guide to Hiring In Bahamas

1. Global Expansion joins the United Nations Global Compact initiative X Back to Countrypedia Definitive Guide to Hiring in Bahamas This website stores cookies on your computer. These cookies are used to improve your website experience and provide more personalized services to you, both on this website and through other media. To find out more about the cookies we use, see our Privacy Policy. Find everything you need to confidently hire in Bahamas - labor law, tax law, compliance, payroll, benefits and more. We won't track your information when you visit our site. But in order to comply with your preferences, we'll have to use just one tiny cookie so that you're not asked to make this choice again. Capital Nassau

2. Nassau Accept Decline Population 407,906 Monetary Unit Bahamian dollar Download Guide Hiring in Bahamas Sections Hiring employees compliantly in Bahamas means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Azerbaija 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 Bahamas or (b) use an Employer of Record like Global Expansion who can handle all of the details for you. Labor Laws in Bahamas Employee Probation Period The probationary period is around 12 months as per certain collective bargaining agreements.

3. Annual Leave in Bahamas Every employer shall give a vacation of at least two weeks to each employee upon the completion of each twelve months of employment. The vacation given under subsection shall be extended by one day for every public holiday that occurs during the vacation. Holidays in Bahamas Workers are entitled to paid holidays during Festival (public and religious) holidays. These include memorial holidays and religious holidays (Christian origin). Here is the full list of public holidays in Bahamas: New Year’s Day 1st January 10th January Majority Rule Day 10th April Good Friday 13th April Easter Monday

4. 1st June Whit Monday 5th June Labor Day Independence Day of Bahama 10th June Emancipation Day (of Bahamas) 3rd August National Heroes Day (in Bahamas) 12th October Christmas Day 25th December Boxing Day  26th December   Maternity Leave Bahamas Except where an employee otherwise desires, maternity leave shall be for a period of not less than twelve weeks An employee who, after confinement, suffers any illness arising out of such confinement shall be granted, in addition to the maternity leave to which she is entitled, an additional unpaid leave not exceeding six weeks as a medical practitioner recommends. Paternity Leave Bahamas There is no paternity leave However, male employees can benefit from the ‘Family Leave’

5. An employee who has been employed for at least six months is entitled to family leave without pay for a period not exceeding one week per annum following the birth of a child; or the death or illness of a child, spouse or parent. Sick Leave in Bahamas An employee who has been employed for at least six months is entitled to one-week sick leave with pay in any year where he is prevented by illness from performing his duties at his place of work: - Provided that no employee shall be entitled to receive payment in respect of periods of sick leave which is only one day long nor to accumulate such leave from year to year. Every employee shall be required to produce to his employer a medical certificate except in respect of the first day’s sick leave for any period of sick leave Working Hours in Bahamas The standard work week in The Bahamas is eight hours a day or forty hours a week. Overtime in Bahamas Employees who work more than the standard forty hours per week must be paid overtime pay, with the exception of supervisors and managers. Overtime pay is one and one-half times the regular hourly rate, and two times the hourly rate on public holidays and days off.

6. Notice Period in Bahamas The minimum period of notice required to be given by an employer to terminate the contract of employment of an employee shall be - where the employee has been employed for six months or more but less than twelve months - one week’s notice or one week’s basic pay in lieu of notice; and - one week’s basic pay (or a part thereof on a pro rata basis) for the said period between six months and twelve months; - where the employee has been employed for twelve months or more - two weeks’ notice or two weeks’ basic pay in lieu of notice; and - two weeks’ basic pay (or a part thereof on a pro rata basis) for each year up to twenty-four weeks; - where the employee holds a supervisory or managerial position - one month’s notice or one month’s basic pay in lieu of notice; and - one month’s basic pay (or a part thereof on a pro rata basis) for each year up to forty-eight weeks. Severance in Bahamas No severance payment in case of dismissal with justified reason, which occurs when the employee has committed a fundamental breach of his contract or has acted in a manner repugnant to the fundamental interests of the employer – gross misconduct- (section31 EA: summary

7. dismissal Redundancy Payment: - - Employer who dismisses an employee, of at least 1- year tenure, must pay - 2 weeks (or a part thereof on a pro rata basis) for each year up to 24 weeks. - 1 month (or a part thereof on a pro rata basis) for each year up to 48 weeks for supervisory or managerial positions. Personal grounds severance payment: - - Employer must pay the following severance payments - 1 week (or a part thereof on a pro rata basis > 6 m < 12 m. - 2 weeks (or a part thereof on a pro rata basis) for each year up to 24w > 12 months. - 1 month (or a part thereof on a pro rata basis) for each year up 48 w for supervisory or managerial positions. 13th / 14th Month Pay Yes There is no statutory requirement to pay the 13th or 14th month salary, however it is customary to pay a Christmas bonus, this is discretionary however, if the employee includes it in the contract they will be bound by it. Bahamas Salary and Wages

8. Income Tax in Bahamas Income is not taxed in the Bahamas. Social Security in Bahamas. All employees and employers must contribute to the social security (national insurance) scheme. Contribution rates are based on the amount of weekly or monthly wages. Effective from 1 July 2018, the ceiling increased to BSD670 weekly, BSD2,903 monthly or BSD34,836 annually. The total contribution rate is 9.8% of the employees’ wages, of which 3.9% is withheld from the employee and 5.9% is paid by the employer. Contribution Social Security Contribution Employer 5.9% Employee 3.9% Immigration Bahamas

9. The right of expatriates to work in the Bahamas is restricted and regulated by the Bahamas government through the Department of Immigration. The government attempts to ensure that immigrants do not create unfair employment competition for Bahamians. An expatriate may not be offered a position for which a suitably qualified Bahamian is available. No quota system exists for work permits. A work permit application is not considered if the employee is already in the Bahamas as a visitor. The Department of Immigration considers the employment of a non-Bahamian if the prospective employee would be an asset to the Bahamas, and if the following conditions are met: - The employer has advertised and interviewed locally and has found no suitable Bahamian to fill the position. - The employer has obtained a vacancy certificate stating that no qualified Bahamian is registered who might fill the position. Normally, it is the employer’s responsibility to submit the work permit application for the prospective employee. This includes all necessary documentation, along with a copy of the local job advertisement, the results of interviews with local applicants and a vacancy certificate. Employment may commence only after the work permit is approved and the fee is paid. A work permit is usually issued for one year, but may be issued for a longer period for certain key positions under contract. Contracts should indicate that renewal is subject to obtaining immigration permission. Many employment contracts stipulate that the employee is expected to train or be replaced by a suitable Bahamian within a stipulated period of time. The Bahamas does not issue permanent work permits, but

10. does issue permanent residence permits that grant the right to work. Work permits are issued for a specific position only. Changes in position within an organization require the issuance of a new work permit Temporary residence Individuals making the Bahamas their temporary home may apply for annual residence permits. The annual cost of this permit is BSD2,000 for the head of a household and BSD100 for a spouse and each dependent. A person attending an institute of higher education in the Bahamas must pay BSD100 per year for an annual residence permit. Holders of annual residence permits may not work in the Bahamas under any circumstances. Overseas investors who acquire residential property in the Bahamas are eligible for Home Owners’ Residence Cards, which are renewable annually. The annual cost of the card is BSD500. The card facilitates entry into the Bahamas and entitles the owner, spouse and minor children to remain in the Bahamas for the period covered by the card. This card is most appropriate for seasonal residents. Holders of the card may seek local employment. Type of Visa/Permit Documentation Validity Eligibility Letter of Request addressed to the Director of

11. addressed to the Director of Immigration Duly completed First Schedule Form 1 application Applicant’s original medical certificate Applicant’s original police certificate The Department of Immigration considers the employment of a non-Bahamian if the prospective employee would be an asset to the Bahamas, and if the following conditions are met: Two (2) current passport photographs of applicant Copy of the biographical data page of applicant’s CURRENT passport The employer has advertised and interviewed locally and has found no suitable Bahamian to fill the position.  Generally 1 year Work Permit Copy of biographical data page of Employer/Sponsor’s current passport The employer has obtained a vacancy certificate stating that no qualified Bahamian is registered who might fill the position.  Labor Certificate with Notification of Vacancy from the Department of Labor-Bahamas. Nationally circulated newspaper advertisements Two (2) written references from previous employers Letter of release from applicant’s previous employer Immigration Form completed and notarized with a ten dollar (B$10.00) Bahamian postage

12. ten dollar (B$10.00) Bahamian postage stamp affixed thereon; Two (2) passport- size photographs with signature on reverse of prints; Police certificate covering five (5) years residence. Proof of jurisdictionMedical certificate dated not earlier than thirty (30) days before this application; Two (2) testimonials of good character; Copy of lease or deed (if available); Individuals making the Bahamas their temporary home may apply for annual residence permits. Financial reference from a reputable bank verifying economic worth, i.e., citing a figure range; The annual cost of this permit is BSD2,000 for the head of a household and BSD100 for a spouse and each dependent.  Confirmation of whether or not the applicant owns a home or property in The Bahamas, and if yes, the address; Annual Residence Permit 1 year A person attending an institute of higher education in the Bahamas must pay BSD100 per year for an annual residence permit.  A statement of net worth stating a figure range and how it is comprised (asset classes); Source of income including whether derived from employment, pension, investments, trust funds, etc.;

13. Amount of time to be spent in The Bahamas; Civic or charitable affiliations; Reasons for seeking residence in The Bahamas; Ticket evidencing intended departure (if applicable); And Processing Fee of one hundred Bahamian dollars (B$100) Immigration Form duly completed and notarized with a ten dollar (B$10.00) Bahamian postage stamp affixed thereon; Two (2) passport size photographs with signature on reverse of prints; Police certificate covering five (5) years of residence or where these are not issued, a sworn affidavit in lieu of same; Overseas investors who acquire residential property in the Bahamas are eligible for Home Owners’ Residence Cards, which are renewable annually.  Home Owners’ Residence Card 1 years Certificate from The Bahamas Investment Authority The annual cost of the card is BSD500.  Copy of valid passport Proof of ownership of property and/or investment in The

14. of property and/or investment in The Bahamas in the form of copies of conveyances, deeds or contracts; and Processing fee of one hundred Bahamian dollars (B$100) Value Added Tax (VAT) in Bahamas The Bahamas imposes value-added tax (VAT) on the purchase of various consumer goods and services. The standard rate of VAT was reduced to 10% from 12% as from 1 January 2022. The supply of real property is subject to VAT at a rate of 2.5% on transactions not exceeding BSD 100,000 and 10% on transactions over BSD 100,000. Transactions comprising the disposition of a business’ assets other than cash, deposit accounts, and real property are chargeable at a rate of 6%. Transactions comprising the disposition of a business’ assets other than cash, deposit accounts, and real property are chargeable at a rate of 6%. VAT Standard Rate 10% Reduced Rate 6%

15. Reduced Rate 2.5% Reduced Rate 1% Reduced Rate 0.01% Zero Rate 0% Termination An employer may summarily dismiss an employee without pay or notice when the employee has committed a fundamental breach of his contract of employment or has acted in a manner repugnant to the fundamental interests of the employer - Provided that such employee shall be entitled to receive previously earned pay. In normal circumstance, an employee may be dismissed with pay and notice period The minimum period of notice required to be given by an employer to terminate the contract of employment of an employee shall be - where the employee has been employed for six months or more but less than twelve months - one week’s notice or one week’s basic pay in lieu of notice; and - one week’s basic pay (or a part thereof on a pro rata basis) for the said period between six

16. rata basis) for the said period between six months and twelve months; - where the employee has been employed for twelve months or more - two weeks’ notice or two weeks’ basic pay in lieu of notice; and - two weeks’ basic pay (or a part thereof on a pro rata basis) for each year up to twenty-four weeks; - where the employee holds a supervisory or managerial position - one month’s notice or one month’s basic pay in lieu of notice; and - one month’s basic pay (or a part thereof on a pro rata basis) for each year up to forty-eight weeks Mandatory Bene몭ts in Bahamas These are mandatory benefits as postulated by law These include probationary period, annual leave, public holidays, sick leave, maternity leave, family leave, overtime pay, notice period, and severance pay Mandatory benefits also include social security benefits. Mandatory Bene몭ts overview Probationary period Annual Leave Public Holidays

17. Public Holidays Maternity Leave Family Leave Sick Leave Overtime Pay Notice period Severance Pay Social Security Benefits Payments And Invoicing Income is not taxed in the Bahamas. Payroll Accrual in Bahamas Country Accruals Additional Information National Insurance 5.90% Vacations 5.48% Severance per year of service 4.00%

18. Description All individuals working in the Bahamas are normally liable to pay national insurance on a maximum annual salary of BSD34,836. An employee rate of 3.9 percent and an employer rate of 5.9 percent is applied to the employee’s salary. The rates are applied up to a maximum ceiling of BSD670 weekly or BSD2,903 monthly (totaling a maximum annual salary of BSD34,836). This maximum level is effective from 1 July 2018 and is subject to a further increase every 2 years thereafter by the estimated increase in average wages. An update to the National Insurance rates and ceiling is scheduled for 1 July 2020. Details of the changes are currently not available. The national insurance scheme is compulsory. It provides benefits in respect of sickness, industrial injury, disability, maternity, retirement, and death. Payroll Accruals Additional Information     Employment Accruals Every employer shall give a vacation of at least two weeks to each employee upon the completion of each twelve months of employment. This equals 3.84% (2/52 weeks) of annual income Annual Leave

19. Maternity leave shall be for a period of not less than twelve weeks This equals 23% (12/52 weeks) of annual income Maternity Leave An employee who has been employed for at least six months is entitled to one- week sick leave with pay This equals 1.92% (1/52 weeks) of annual income Sick Leave Overtime pay is one and one-half times the regular hourly rate, and two times the hourly rate on public holidays and days off. Normal hourly rate is around 24.32 BSD. Overtime is paid at an additional 12.16 BSD. Overtime Employer who dismisses an employee, of at least 1-year tenure, must payd to receive: Contributions to severance indemnity fund equal 8% of monthly salary. This should be multiplied 2 weeks (or a part thereof on a pro rata basis) for each year up to 24 weeks.. Severance

20. should be multiplied by 12 to calculate yearly contribution. 1 month (or a part thereof on a pro rata basis) for each year up to 48 weeks for supervisory or managerial positions. This equals 5.9% of monthly salary. Multiply this by 12 to attain an annual amount Social security contribution by the employer is 5.9% of monthly salary Social Security Accrued Bene몭ts in Bahamas Christmas Bonus % 0% 0% Christmas Bonus Over Vacations % Severance per Year%

21. Severance per Year% Employees are entitled to severance pay equal to one week's pay(1.37% of annual salary) 1.37% Vacations % Employees are entitled to 2 weeks of paid leave following one year of service (4.16% of annual salary) 4.16% Of annual salary Notice % Employees are entitled to 2 weeks of notice after the completion of 1 year of service (2.74% of annual salary) 2.74% 0% Christmas Bonus Over Notifications % 0% Vacations Plus % Total percentage of Salary (yearly) 6.85% The total employment accruals as a percentage of salary per annum

22. Why use Global Expansion to hire in Bahamas Establishing a branch office or subsidiary in Bahamas 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 Bahamas labor laws are complex. The company also has a responsibility to comply with specific employment practices dictated by Bahamas law to maintain its good standing as an equal opportunity employer. Global Expansion makes it easy for you to expand into Bahamas. 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 Bahamas 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.  

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