Guide to employment, payroll and benefits in

Iraq

Rivermate offers complete payroll, benefits and compliance services for

Iraq

01. Overview

Last updated: 

August 19, 2021

Currency
Iraqi Dinar
Capital
Baghdad
Ease of doing business
44.7
Language
Arabic
Population
40222493
GDP growth
-2.07%

02. Grow your team in

Iraq

with Rivermate

Payroll, benefits, taxes, and compliance can be difficult to manage in

Iraq

, particularly if you don't have established local relationships. You can hire employees in

Iraq

effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global employment solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

03. Summary

Iraq, officially the Republic of Iraq, is a country in Western Asia bordered on the north by Turkey, on the east by Iran, on the southeast by Kuwait, on the south by Saudi Arabia, on the southwest by Jordan, and on the west by Syria. Baghdad is the country's capital and largest city. Arabs, Kurds, Turkmens, Assyrians, Yazidis, Shabakis, Armenians, Mandaeans, Circassians, Sabians, and Kawliya are among Iraq's ethnic groups. Muslims make up 95-98% of the country's 38 million citizens, with small minorities of Christians, Yarsans, Yezidis, and Mandeans. Arabic and Kurdish are Iraq's official languages. The Mesopotamian Alluvial Plain, the northwestern end of the Zagros mountain range, and the eastern portion of the Syrian Desert are all part of Iraq's 58-kilometer-long coastline on the northern Persian Gulf. The Tigris and Euphrates are two major rivers that flow south through Iraq and into the Shatt al-Arab near the Persian Gulf. These rivers offer vast swaths of fertile land to Iraq. Mesopotamia, the area between the Tigris and Euphrates rivers, is sometimes referred to as the "cradle of civilization." It was here that humanity first learned to read, write, establish rules, and live in cities under a centralized government, most notably Uruk, from which the name "Iraq" was derived. Since the 6th millennium BC, the region has been home to various civilisations. The Akkadian, Sumerian, Assyrian, and Babylonian empires all had their capital in Iraq. It was also a part of the Median, Achaemenid, Hellenistic, Parthian, Sassanid, Roman, Rashidun, Umayyad, Abbasid, Ayyubid, Seljuk, Mongol, Timurid, Safavid, Afsharid, and Ottoman empires. Until the Ottoman Empire was partitioned in the twentieth century, Iraq was a territory of the Ottoman Empire. Mosul Vilayet, Baghdad Vilayet, and Basra Vilayet were the three provinces that made up the Ottoman Turkish language. Under the auspices of the League of Nations, the British Mandate of Mesopotamia was established in April 1920. In 1921, Faisal I of Iraq created a British-backed monarchy to unite these vilayets into one Kingdom. In 1932, the Hashemite Kingdom of Iraq declared independence from the United Kingdom. The monarchy was deposed in 1958, and the Iraqi Republic was established. From 1968 to 2003, Iraq was ruled by the Arab Socialist Ba'ath Party. Iraq invaded Iran in 1980, igniting a protracted war that lasted nearly eight years and ended in a stalemate with disastrous losses for both countries. Saddam Hussein's Ba'ath Party was deposed from power in 2003 after an invasion by the US and its allies, and multi-party parliamentary elections were held in 2005. The US military involvement in Iraq ended in 2011, but the insurgency in Iraq grew stronger as fighters from Syria's civil war entered the region. The rebellion spawned ISIL, a highly destructive organization that seized vast swaths of the north and west.

04. Public holidays

05. Types of leave

Paid time off

After one year of service, employees are entitled to at least 21 days of vacation per year. After the first five years, the leave increases by two days, then another two days after the next five years, and three days after the next five years. The annual leave is 30 days in the case of dangerous work. Days of annual leave are calculated pro-rata to the employee's hours and wage for part-time work.Employees can also take time off for a wedding, the wedding of a child, a death in the family, or to perform official or public duties. Female employees who are widowed or divorced are also given time off. Employees are allowed to take unpaid leave for serious personal reasons or for a one-time religious pilgrimage.

Public holidays

There are many holidaysNew Year’s DayIraqi Army DayFestival of Spring (Nowruz)Sovereignty DayLabor DayEid AI-FitrRepublic DayEid AI-AdhaIslamic New YearAshuraMawlid Al-NabiIn Kurdistan, they recognize:Uprising DayLiberation of Erbil CityMustafa Barzani’s BirthdayKurdish New YearBaghdad Liberation DayChristmas Day

Sick days

To be covered by the Pension and Social Security Fund, an employee must be sick for more than eight days and have a doctor's note. Each year of employment entitles the employee to 30 days of sick leave, up to a total of 180 days. If an insured employee uses up all of their paid sick leave and remains sick for more than 30 days, the Pension and Social Security Fund will reimburse the employer for wages paid after the 30-day period, as long as the diagnosis is documented by a medical certificate.

Maternity leave

Employees who are female are entitled to 14 weeks of paid maternity leave. Due to complications or multiple births, leave can be extended for up to nine months. A medical note from a competent authority is required for this. Employees who have a child under the age of one year can take up to 12 months of unpaid leave to care for them. The employment contract is considered suspended in such cases.

Paternity leave

Although paternity leave is not available, any of the partners can take up to three days of unpaid leave to care for a sick child under the age of six.

Parental leave

Other than the already mentioned terms regarding maternity and paternity leaves in Iraq, there are no other provisions in the law regarding parental leave.

Other leave

06. Employment termination

Termination process

A contract may be terminated by either the employer or the employee. However, in Iraq, there are two types of terminations: automatic and manual. An employment contract will automatically terminate in certain circumstances, including the death of an employee or employer, the liquidation of the firm, or the expiration of a fixed-term contract.


Employment contracts can be manually terminated in a variety of circumstances, including when both parties agree in writing to terminate the contract, the employee becomes ill and is unable to work for more than six months, the employee reaches retirement age, or the employee violates contractual obligations.

Notice period

Employers must provide employees at least 30 days' notice in writing and pay an end-of-service gratuity that ranges from two to twenty weeks' worth of service, depending on the length of employment.


Discrimination, medical leave, submitting a complaint, or membership to a trade union are all grounds for dismissal. Employees are free to resign at any moment as long as they provide the employer at least 30 days' notice. If an employee leaves without notice or before the end of the notice term stipulated in the contract, they must pay the employer a monetary equivalent of the notice period's fraction.

Severance pay

In general, any employee whose service is terminated is entitled to an end of service gratuity equal to two weeks' pay for each year of service, except in the following circumstances: the employee is sentenced to more than one year in prison by a final court judgment; the employee assumes a false identity or submits forged documents; the employee violates his or her contractual obligations; or the employee commits a serious error that results in material damage to the work, workers, or production.

Probation period

Employers have the right under the Labor Law to hire employees on a probationary basis for up to three months.

07. Working hours

General

The typical workday is eight hours long and 48 hours long per week. Each employee is entitled to 24 consecutive hours of rest, which are typically scheduled on Fridays.


Employers with more than one female employee are required to maintain a copy of the provisions governing female worker protection on the job, in addition to establishing a nursery at their expense or in collaboration with other employers.

Overtime

Overtime is generally limited to four hours per day, eight hours per week, forty hours every ninety days, and 120 hours per year. The wage must be increased by 50% during the workday and 100% during the evenings and holidays.

08. Minimum wage

General

The country's minimum wage is currently 350,000 Iraqi dinars (IQD) per month.

09. Employee benefits

General

You and your employees are both required to contribute to a social security system that includes health insurance and sick leave. Employees who use their sick leave for more than 30 days are covered by their insurance provider.

Any additional employment benefits, such as housing, car allowances, and meals, are typically determined by your company. Because the government does not regulate these benefits, you are free to offer whatever benefits and bonuses you see fit in order to attract top talent to your company.

10. Why Rivermate as your Employer of Record / PEO?

Establishing an entity in

Iraq

to hire a team takes time, money, and effort. The labor law in

Iraq

has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into

Iraq

simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record solutions in

Iraq

give you peace of mind so you can focus on running your business.

Please contact us if you'd like to learn more about how Rivermate can help you hire employees in

Iraq

via our Employer of Record / PEO solution.

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