A written employment contract is required for all employees in Jordan, including permanent and temporary workers. The contract must detail the job description, work hours, salary, allowances, and termination conditions. Specific contracts must be in place for non-Jordanian nationals, including those requiring work permits.
Employer of Record (EOR) Jordan
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in Jordan
A written contract is mandatory before the employee begins work, ensuring legal protection for both parties. It should be signed at the start of employment, and should be presented in both Arabic and English to ensure clarity for all employees.
Salaries must be explicitly stated in Jordanian Dinars (JOD) and should include base salary along with any additional benefits such as bonuses, allowances, or commissions. It is also important to specify the payment frequency (monthly or bi-monthly) and any statutory deductions for tax or social security.
Contracts should include clauses specific to Jordanian labor law, such as non-compete clauses for certain industries, confidentiality agreements, and terms for non-discriminatory practices. Specific provisions also apply for non-Jordanian employees, such as work permits and residency documentation.
in Jordan
1. What are the key steps in employee onboarding in Jordan?
Employees must complete several steps before starting their role. This includes obtaining a national tax identification number (TIN), registering with the Jordanian Social Security Corporation (SSC), and opening a local bank account for salary payments.
2. When should employees complete pre-hire medical checks in Jordan?
Medical checks are mandatory for certain roles, particularly those in industries with health and safety concerns. For general employees, these checks should be completed before commencing work, and the employer must ensure that the medical certification is submitted.
3. What documents are required for onboarding in Jordan?
For onboarding in Jordan, employees need to provide a valid Jordanian ID (or passport for foreign employees), a national tax identification number (TIN) for tax purposes, and a social security number for registration. Additionally, employees must submit bank account details for salary payments and a work permit if they are non-Jordanian nationals.
in Jordan
Salaries in Jordan are typically paid on a monthly basis. The payment must cover all standard working hours, and employers are required to pay overtime where applicable. In addition, employees are entitled to a 13th-month bonus, which is usually paid at the end of the year.
Remote employees in Jordan are subject to the same payroll rules, and employers must ensure that home-office allowances, internet and electricity costs, and other remote work benefits are clearly outlined in the contract. Employers should ensure these benefits comply with Jordanian tax laws to avoid penalties.
The minimum wage in Jordan is currently JOD 260 per month. However, for employees working in specific industries (such as construction or hospitality), this amount can vary. Employers are required to comply with the minimum wage regulations as set by the Ministry of Labor.
In Jordan, the 13th and 14th-month salaries are additional payments typically given at the end of the year. They are not legally mandatory but are common practice in many private sector contracts. Employers who provide these bonuses generally do so as part of the employment agreement.
in Jordan
1.What are the income tax rates in Jordan?
Jordan follows a progressive tax system. Tax rates range from 7% to 30%, depending on the income level. The tax rate starts at 7% for monthly income up to JOD 1,000, and it increases progressively for higher income levels.
2. When should tax returns be submitted in Jordan?
Both employers and employees must submit annual tax returns by the end of March for the previous year’s income. Employers are responsible for withholding tax throughout the year from employee salaries and remitting these amounts to the Jordanian tax authorities.
3. How does the tax system apply to non-residents in Jordan?
Non-residents working in Jordan are taxed on their Jordanian-sourced income. They are subject to a flat tax rate of 7% for monthly income up to JOD 1,000, and progressive rates for higher earnings.
4. What social security contributions are required in Jordan?
Social security contributions in Jordan are mandatory for all employees. Employers contribute 14.25% of an employee’s salary, while employees contribute 7.5%. These contributions are used to fund pensions, healthcare, and other social benefits.
in Jordan
Employees in Jordan are entitled to a minimum of 14 days of paid annual leave after completing one year of service. This entitlement increases to 21 days for employees with more than five years of service.
Employees begin to accrue leave on the first day of employment, but they must complete six months of continuous service before they can take leave. After this period, they can take the leave that has accrued.
Female employees are entitled to 70 days of paid maternity leave. Maternity leave must start at least 2 weeks before the expected date of delivery. Male employees are entitled to 3 days of paid paternity leave immediately after the birth of a child.
Jordan has 14 public holidays, including national and religious holidays such as Eid al-Fitr, Eid al-Adha, and the Prophet’s Birthday. Employees are entitled to these days off with pay, though work may be required in certain industries if specified in the employment contract.
in Jordan
1. What benefits are mandatory in Jordan?
Employers are legally required to provide social security benefits (pensions, healthcare), paid annual leave, and sick leave. Additionally, employers must contribute to work injury insurance and unemployment benefits.
2. How is the home office allowance structured in Jordan?
Employers are not obligated to provide home office allowances under Jordanian law. However, it is common practice for employers to include home office allowances (such as for internet, electricity, and other expenses) in the employment contract, particularly for remote workers.
3. When should meal allowances be provided in Jordan?
Meal allowances are not mandatory in Jordan; however, many employers provide them as a benefit. The standard allowance is typically JOD 1 to JOD 3 per day, which is tax-free for employees if it’s provided in-kind (e.g., free meals) rather than in cash.
4. What additional benefits are common in Jordan?
In addition to the mandatory benefits, many employers in Jordan offer private health insurance, transportation allowances, housing assistance, and educational allowances for employees’ children. These benefits, while not legally required, are often used to attract and retain top talent.
TERMINATIONS
in Jordan
The notice period for terminating an employee varies depending on the employee’s tenure. For employees with less than one year of service, the notice period is one month. For employees with one to three years of service, it is two months. For employees with over three years of service, it is three months.
An employee in Jordan can be terminated without notice during the probationary period, which typically lasts for up to three months. Termination without notice is also allowed in cases of gross misconduct or violation of employment terms. Employers must provide evidence of the reason for dismissal to avoid legal issues.
Severance payments in Jordan are calculated based on the employee’s length of service and the reason for termination. For employees with at least one year of service, the severance pay is one month’s salary for each year worked. If the termination is due to a cause beyond the employee’s control, the severance is typically higher.
In Jordan, mutual termination occurs when both the employer and employee agree to end the employment relationship. It typically requires a written agreement that outlines the terms of termination, including any severance payments or compensation. The conditions for mutual termination are usually negotiated to ensure both parties are satisfied with the agreement.
FAQs
1. How does Globaine ensure full compliance with Jordan's labor laws when hiring and managing employees through the EOR solution?
Globaine manages all aspects of employee compliance, including payroll, social security, and tax obligations, in accordance with Jordan’s labor laws to ensure full legal compliance.
2. What specific cost savings can our company expect by using Globaine's EOR solution compared to setting up a local entity in Jordan?
Using Globaine’s EOR eliminates the need for costly entity formation, reduces administrative burdens, and cuts down on legal and tax compliance expenses in Jordan.
3. How does Globaine guarantee fast onboarding within 12 hours, and what processes are in place to maintain this speed?
Globaine guarantees quick onboarding by utilizing a streamlined process that includes pre-established agreements, automated systems for document management, and a local expert team ready to onboard employees efficiently.
4. Can Globaine handle complex employment scenarios in Jordan, such as drafting bilingual contracts and managing terminations?
Yes, Globaine handles complex scenarios by drafting bilingual contracts, managing terminations, and ensuring full legal compliance with Jordan’s employment regulations.
5. What are the key risks of hiring in Jordan without an EOR, and how does Globaine mitigate these risks?
Risks include non-compliance with labor laws, tax issues, and costly legal disputes. Globaine mitigates these by managing all legal and administrative requirements on your behalf.