How to hire in Zambia through an EOR

Fixed-term contracts expire automatically, but chaining them together can accidentally create an indefinite one. Most companies use indefinite contracts for ongoing roles to avoid renewal complications and give employees more stability.

Indefinite contracts are the norm because Zambia's Employment Code Act No. 3 of 2019 is built around stability in permanent roles. Fixed-term contracts work for short-term needs, but watch how you renew them. Courts can rule that successive fixed-term contracts have effectively become indefinite.

What has to be in the contract

Any contract lasting more than six months, or the equivalent number of working days in a year, must be in writing. Oral agreements can work for shorter arrangements, but you should still keep records of the key details: names, start date, job title, place of work, hours, pay, leave, and notice periods.

Make sure the written contract covers:

• Employer and employee names
• Start date and job duties
• Work location
• Hours per day/week
• Salary, frequency, payment method
• Leave types and amounts
• Notice periods
• Probation details if any
• Any collective agreement

There's no legal requirement on language, but English is standard for business contracts. Don't include clauses that try to hold family members liable. They're not enforceable. Probation can't exceed six months in total. During probation, you can terminate with shorter notice, but there are minimums: 24 hours for employment under a month, 14 days for 1 to 3 months, and 30 days beyond that.

Contractor vs employee

Zambia's test comes down to control. If you're dictating someone's hours, tools, and tasks, they're likely an employee regardless of what the contract says. Getting this wrong is costly. You could owe back taxes, pension contributions, NAPSA and NHIMA payments, and benefits like leave entitlements.

Violations can trigger labor inspections, back payments with interest, and in serious cases, criminal charges for willful evasion. The penalties aren't always a fixed amount per case, but the exposure adds up quickly. If you're unsure about classification, an EOR can take that risk off your plate.

Non-compete clauses are enforceable if they're reasonable in scope. Keep them limited to a specific time period, geography, and the role actually needed to protect confidential information. IP assignment clauses work too, but note that employees own what they create using your time and tools unless the contract says otherwise. Courts will strike down clauses that are too broad, so keep them proportionate.

The most common mistakes are skipping written contracts for longer engagements, accidentally converting fixed-term contracts into permanent ones through repeated renewals, and misclassifying employees as contractors by controlling too much of how they work. If a worker pursues reclassification, you're looking at retroactive payroll taxes, severance, and potential legal costs. Use indefinite contracts for your core hires, keep clear records, and get local legal advice when you're unsure.

Zambia's Employment Code Act sets a clear baseline for leave and benefits. Here's what you're required to offer, and what employees actually expect in practice.

Time off

Full-time employees get at least 24 calendar days of paid annual leave per year. It accrues at two days per month after 12 months of continuous service. Part-time employees get leave pro-rated by hours worked.

In some cases, employees can use partial leave after six months. If they don't take their leave within 12 months, you'll need to pay it out at full pay: (full pay x days)/26. Full pay includes basic salary plus allowances.

Public holidays below are paid when they fall on a workday.

All leave types

The law sets clear minimums for each leave type. Employers cover 100% of pay unless noted below, and employees keep their job protection throughout.

There's no statutory parental leave beyond maternity and paternity. Study leave and sabbaticals aren't required by law, but they do show up in contracts fairly often. Casual workers aren't entitled to paid leave.

Mandatory benefits

You're required to contribute to social security through NAPSA. There's no national health insurance scheme, though some sectors have their own funds.

A thirteenth-month bonus is standard practice across most employers, even where it's not legally required. There are no mandates around meal vouchers or transport allowances. Minimum wage rules apply in certain sectors, so it's worth checking what applies to your industry.

What employees actually expect

If you're hiring for skilled or competitive roles, the legal minimums probably won't be enough. Many candidates expect 30 or more days of annual leave, and private health insurance that covers hospitalization and specialists. Public healthcare is limited, so this matters to people.

A thirteenth-month bonus is widely expected, not just appreciated. Pension contributions beyond NAPSA are common too, with employer matches in the 10-15% range. If your team is outside Lusaka, a fuel or remote work allowance can make a real difference.

Flexible hours and performance bonuses also come up regularly in hiring conversations. To get a sense of going rates for your industry, sites like Jobs Zambia are a useful starting point.

Terminating someone in Zambia got importantly more structured after the Employment Code Act of 2019. You need a valid reason tied to the employee's conduct, capacity, or your business needs. Without that, you're looking at an unfair dismissal claim.

Valid grounds include poor performance, misconduct, or redundancy. Summary dismissal is only for gross misconduct like theft or willful disobedience. Protected categories cover maternity leave, union activities, and filing complaints. Zambia's courts expect proof of fairness, and if you get it wrong, you could face reinstatement orders or compensation payouts.

Notice periods

Notice must be in writing for contracts over six months. You can pay in lieu instead. Probation ends on 24 hours' notice. Here's how it breaks down by tenure.

Contracts can set longer periods than the minimums above. Don't give notice while an employee is on leave.

Severance

Severance applies to redundancy situations after two years of service. It's not required for fixed-term contracts ending naturally, summary dismissals, or mutual agreements. Current law doesn't set a cap on the total amount.

The formula is one week's pay per year of service, based on the employee's last drawn basic pay. Prorate for partial years. Pay it by their last day, or you'll owe wages until you do.

Work permits and visas

You can hire foreign nationals through an EOR. The EOR acts as the legal employer and sponsors the work permit. The two main categories are the Employment Permit for skilled workers and the Investor's Permit for business owners.

You'll need a job offer, proof of qualifications, and evidence that no suitable Zambian candidate was available. Processing runs 3-6 months through the Department of Immigration. There's no digital nomad visa, and renewals require fresh applications each time.

Budget for medical checks, police clearance, and fees starting around $500-$1,000 plus processing costs. An EOR can handle the paperwork, but you'll need to supply the job details and supporting documentation.

Other risks to watch

Data protection is governed by the Data Protection Act of 2021. You need consent to collect employee data, must keep it secure, and are required to report breaches. Fines reach up to 5 million kwacha for violations.

Trade unions carry real weight in Zambia, particularly in mining, where some sectors see union density above 70%. Collective bargaining agreements often set terms that go beyond what the law requires. It's worth checking whether your hire's role falls under one before you finalise their contract.

Keep an eye on the Employment Code Amendment Bill 2023, which was approved by Cabinet. It adjusts termination benefits and redundancy rules, adds standard procedures for non-union employees, and clarifies certain rights. It could be passed in 2026 and may increase costs or steps involved in terminations.

Document everything and follow procedures closely. An EOR can help you stay on top of local filings and handle disputes if they arise. Employment tribunals in Zambia move slowly, so getting things right upfront is worth the effort.