Guide to employment, payroll and benefits in

Papua New Guinea

Rivermate offers complete payroll, benefits and compliance services for

Papua New Guinea

01. Overview

Last updated: 

August 19, 2021

Papua New Guinean Kina
Port Moresby
Ease of doing business
GDP growth

02. Grow your team in

Papua New Guinea

with Rivermate

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

Papua New Guinea

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

Papua New Guinea

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

Papua New Guinea, officially the Independent State of Papua New Guinea, is an Oceanian nation that encompasses the eastern half of New Guinea's island and its surrounding Melanesia islands. Port Moresby, the country's capital, is situated on the country's southeast coast. With 462,840 km2, it is the world's third largest island nation. After being governed by three foreign powers since 1884, Papua New Guinea declared independence in 1975. This came after nearly 60 years of Australian administration, which began during World War I and ended in 1975 when Elizabeth II became Queen of the Commonwealth. It also became an independent member of the Commonwealth of Nations. Papua New Guinea is one of the world's most culturally diverse nations. It is also the most rural, with just 13.25% of the population living in cities as of 2019. In the world, there are 851 recognized languages, 11 of which have no known speakers. The majority of the country's population of over 8 million people live in traditional societies, which are as diverse as the languages. Culturally and geographically, the country is one of the least visited in the world. The sovereign state is listed as a developing economy by the International Monetary Fund. It is believed to have several uncontacted populations, and researchers claim there are many undiscovered species of plants and animals in the interior. Nearly 40% of the population has no access to global resources and lives a self-sustaining natural lifestyle. The majority of the population is divided into strong traditional social classes centered on agriculture. Traditional faith is combined with modern practices, such as primary education, in their social lives. The Papua New Guinea Constitution expressly recognizes these cultures and clans, expressing the desire for "existing villages and communities to remain as viable units of Papua New Guinean society" and protecting their continued significance to local and national community life. Since 1976, the country has been an observer state in the Association of Southeast Asian Nations, and it has applied for full membership. The Pacific Community, the Pacific Islands Forum, and the Commonwealth of Nations all recognize it as a full member.

04. Public holidays

05. Types of leave

Paid time off

Public holidays

Sick days

Maternity leave

Paternity leave

Parental leave

Other leave

06. Employment termination

Termination process

With adequate notice, either employees or employers may end a contract at any moment. Notice requirements are based on an employee's length of service with an employer. one day's notice for service of less than four weeks. If a worker or employee wishes to end a contract without giving notice, they must compensate the other party for the wages earned during the notice period. Notice is not necessary for contract violations or other conditions, such as willfully defying the law; committing fraud; habitually failing to perform tasks; being imprisoned for more than a week; or frequently taking unauthorized leave.

Notice period

The following are the notice periods. For employment of less than four weeks, the notice period is only one day. The notice period is one week for service periods ranging from four weeks to one year. The notice period is two weeks for service of between one and five years. The notice period is one month for employees who have served for more than five years.

Severance pay

Severance pay may be available to employees depending on their annual leave status at the time of termination.

Probation period

There are no provisions under the Papua New Guinea labor laws regarding probationary periods.

07. Working hours


The standard workweek is 44 hours, with eight hours on weekdays and four hours on Saturday. Employees are not permitted to work more than 12 hours per day, not including overtime. Each week, non-shift workers are permitted one 24-hour rest period. Typically, this rest period occurs on Sunday, but your contract may specify a different day.


Overtime is defined as any period of time exceeding eight hours per day or 44 hours per week. Overtime pay is typically time and a half, while Sundays require double the standard rate.

Employers may require weekly overtime if it is necessary to keep the business operating. If an employer requires an employee to work on a Sunday or a federal holiday, the terms must be agreed upon by both parties.

08. Minimum wage


The current minimum wage in Papua New Guinea is K3.52 per hour. This figure is established by the Minimum Wage Board for the nation and is subject to change as the Board deems appropriate.

09. Employee benefits


The nation has a comprehensive public healthcare system based on the National Health Plan, which was implemented in 2011. Employers are not obliged to offer health insurance plans for their workers, although private insurance is available. It is possible that an employer will include it as part of a personal benefits package.

Employment regulations do not mandate incentives, but they do provide the criteria for extra benefits.

An employer is not required to give food rations, but if they do, the food must be edible and of high quality, as specified in the ration scale. If a company chooses to supply work clothes for its workers, the goods cannot be returned.

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

Establishing an entity in

Papua New Guinea

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

Papua New Guinea

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

Papua New Guinea

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

Papua New Guinea

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

Papua New Guinea

via our Employer of Record / PEO solution.

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