Employer of Record in Ethiopia

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Rivermate's Employer of Record (EOR) solution helps companies hire remote employees in Ethiopia . We take care of global payroll, taxes, benefits, compliance and HR activities. So you can focus on growing your business. Our Employer of Record (EOR) solution is beneficial to companies that want to hire remote employees in a breeze. On this page you will find employment information for Ethiopia.

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1. Grow your team in Ethiopia with Rivermate as your Employer of Record (EOR) / PEO

Payroll, benefits, taxes, and compliance can be difficult to manage in Ethiopia , particularly if you don't have established local relationships. You can hire employees in Ethiopia effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global Employer of Record (EOR) solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

2. Summary

Ethiopia is a landlocked nation in the Horn of Africa. Its official name is the Federal Democratic Republic of Ethiopia. It is bounded to the north by Eritrea and Djibouti, to the east and northeast by Somalia, to the south by Kenya, to the west by South Sudan, and to the northwest by Sudan. Ethiopia has an area of 1,100,000 square kilometers (420,000 sq mi). It has 117 million people and is the world's 12th most populated nation, as well as the second most populous in Africa after Nigeria. Addis Abeba, the country's capital and biggest city, is located a few kilometers west of the East African Rift, which separates the African and Somali tectonic plates.

In the Middle Paleolithic era, anatomically modern humans evolved from present-day Ethiopia and spread to the Near East and beyond. Human settlement in Ethiopia by diverse Afroasiatic and Nilotic peoples may have begun in the third millennium BC. The Kingdom of D'mt was created on Ethiopia's northwestern boundary around 980 BC, while the Kingdom of Aksum maintained a coherent civilization in the area for 900 years. Christianity came in the fourth century, while Islam arrived in the seventh. Following the fall of Aksum in 960, a number of kingdoms flourished in what is now Ethiopia. The Zagwe dynasty controlled the north-central sections of Ethiopia until 1270, when it was defeated by Yekuno Amlak, establishing the Ethiopian Empire and its Solomonic line dynasty, which claimed ancestry from the legendary Solomon and Queen of Sheba via their son Menelik I. By the 14th century, the empire had grown in stature via geographical expansion until the mid-18th-century decentralization known as Zemene Mesafint when Emperor Tewodros II reunified and rebuilt Ethiopia.

From 1878 to 1880, Emperor Menelik II undertook a series of conquests known as Menelik's Expansions, which culminated in the construction of Ethiopia's present boundary. Externally, the Treaty of Wuchale in 1889 triggered a series of battles in which Ethiopia beat Italy in the Scramble for Africa in 1896, leaving Ethiopia and Liberia as independent African republics. In 1935, Fascist Italy seized Ethiopia and annexed it together with Italian-controlled Eritrea and Somaliland, constituting Italian East Africa. During the Second World War, the British army and the Ethiopian Arbegnoch force freed Ethiopia. The Derg, a Soviet-backed military dictatorship that deposed Emperor Haile Selassie and the Solomonic family in 1974, governed the nation for almost 17 years, sparking the Ethiopian Civil War. Following the Derg's fall in 1991, the Ethiopian People's Revolutionary Democratic Front (EPRDF) ruled the nation with a new constitution and ethnic-based federalism. Ethiopia has since seen protracted and unresolved inter-ethnic conflict and governmental instability typified by democratic backsliding.

Ethiopia is a multi-ethnic country with around 80 ethnic groups. Ethiopia's major religions are Christianity and Islam. This sovereign state founded the United Nations, the Group of 24 (G-24), the Non-Aligned Movement, the Group of 77, and the Organization of African Unity. Addis Abeba is home to the African Union, the Pan African Chamber of Commerce and Industry, the United Nations Economic Commission for Africa, the African Standby Force, and several worldwide non-governmental organizations (NGOs) focusing on Africa. Ethiopia is seen as a developing nation and a rising power. From 2010 to 2020, it enjoyed 9.4 percent economic growth. In terms of per capita income and the Human Development Index, the nation is considered poor, with high rates of poverty, inadequate respect for human rights, and a literacy rate of barely 49 percent. Agriculture is Ethiopia's major industry, accounting for about half of the national GDP and more than 80% of the labor force in 2015.

Hiring talented employees in a short span is not an easy task. Partnering with an Employer of Record (EOR) like Rivermate in Ethiopia is your best option, giving your organization enough time to focus on other aspects of international expansions like project management and inventory management. The EOR takes care of all the compliance and legal issues while helping you speed up hiring using their knowledge of domestic employment practices and virtual onboarding tools. Top EORs also have provisions for the e-signing of documents to enable faster onboarding.

3. Public holidays

4. Types of leave

There is no information about the types of leave for this country.

Paid time off

After one year of service, employees are entitled to 16 days of paid annual leave. After that, for every two years of service, employees receive one additional day per year.

Public holidays

Ethiopia observes the following public holidays:

Eastern Orthodox


Adwa Victory Day

Good Friday (Eastern)

Orthodox Easter

Labor Day

Patriots’ Victory Day

Eid al-Fitr

Derg Downfall Day

Eid al-Adha




Sick days

Sick leave is given to employees for a period of six months. Employees are paid 100% for the first month of their leave and 50% for the next two months. Any remaining sick leave is unpaid after that.

Maternity leave

Female employees are entitled to 120 days of paid maternity leave, with 30 days taken prior to the expected due date and the remainder taken after the birth.

Paternity leave

Employees who are fathers are entitled to three days of paid parental leave.

Parental leave

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

Other leave

5. Employment termination

There is no information about employment information for this country.

Termination process

Employers may terminate an employee's employment contract with advance notice.

Notice period

The duration of the notice period is determined by the employee's length of service. Depending on the length of service, the notice period is usually one to two months. If an employee is fired for misconduct, no notice is necessary.

Probation period

In accordance with the Labour Proclamation, a probationary period is the initial period of execution of an employment contract to test the suitability of a worker to the assigned position. Probationary must be declared in writing however it may not exceed 60 working days.

Severance pay

Severance pay begins at one month and increases by a third for each year of service; however, it cannot exceed the total annual wage. Dismissals for redundancy are governed by special rules.

6. Working hours

There is no information about the working hours for this country.

General working schedule

The standard workweek is 40 hours, and the law requires eight hours of work per day or 48 hours per week. Daily hours may be increased if necessary during the week, provided they do not exceed 10 hours per day. Young employees are not permitted to work more than seven hours per day.

Additionally, employees are entitled to a consecutive 24 hours of rest each week. Sunday is the standard rest day, but workers may elect to work on another day if the nature of their job requires them to work on Sunday.


Overtime hours are limited to two hours per day, twenty hours per month, or one hundred hours per year. Overtime is compensated at 125 percent of the basic wage, but may be higher depending on the duration of the overtime. Weekend overtime is double the standard rate, and public holidays are paid at a rate of 250 percent.

For specific industry conditions, the Ministry of Work and Social Affairs may make provisions for reduced work hours or other special arrangements.

7. Minimum wage

There is no information about the minimum wage for this country.

Ethiopia has no national minimum wage. Only the public sector has a minimum wage, which is around 420 birr ($22). Some government agencies also have their own minimum wage.

8. Employee benefits

There is no information about the employee benefits for this country.

The business must be a member of the social health system, and employers must provide health insurance for their employees. Employers contribute 11% of payroll to social security on behalf of their employees.

9. Taxes

There is no information about the taxes for this country.

Corporate tax

Ethiopia is a tax-free jurisdiction. Corporations are not subject to income, capital gains, profit, or other types of direct taxes, regardless of their residency status.

Individual income tax

Ethiopia is a tax-free jurisdiction. Corporations are not subject to income, capital gains, profit, or other types of direct taxes, regardless of their residency status.

VAT, GST and sales tax

Ethiopia is a tax-free jurisdiction. Corporations are not subject to income, capital gains, profit, or other types of direct taxes, regardless of their residency status.

10. VISA and work permits

There is no information about VISA and work permits for this country.

The Ethiopia Visa Policy lays out the rules and regulations that govern whether a visitor has to apply for a travel permission or a visa to enter and remain in Ethiopia. The visa requirements for Ethiopia are determined on the traveler's nationality, expected length of stay, and purpose of travel. Check the Ethiopia Visa Policy for further information.

According to the Ethiopia Visa Policy, only two nations' nationals do not need a travel permission or visa to visit Ethiopia.

According to the Ethiopia Visa Policy, passport holders from around 230 countries may apply for an electronic travel authorization, or e-visa, to visit and stay in Ethiopia if they intend to travel by air.

To enter the nation, any tourist who is qualified for an e-visa must apply for a visa. It is possible to get a visa on arrival or an embassy visa. To get a visa on arrival, the visitor must wait in line at border crossings to apply for a visa by submitting a visa application. The tourist must go to the closest Ethiopian Embassy to get an embassy visa.

More information regarding the Ethiopia Visa Policy, visa categories, visa criteria, and the validity of various visa kinds may be found here.

Only nationals of Kenya and Djibouti, according to the Ethiopia Visa Policy, are permitted to enter Ethiopia without a visa. Passport holders from 230 countries, on the other hand, may enter Ethiopia for short excursions with an e-visa.

To acquire an e-visa, these nationals must apply online and receive an authorized tourist visa before departing from their home country.

Passport holders from both countries may also apply for a visa on arrival. These nationals may, however, enhance their travel experience by applying for an e-visa online. According to the Ethiopia Visa Policy, nationals of around ten countries are ineligible for an e-visa. As a result, regardless of their duration of stay in the nation, they must apply for an embassy visa to visit Ethiopia for tourist reasons.

Those nationals who are qualified for e-visa application may apply for a visa at the closest Ethiopian Embassy if they intend to visit the country for additional reasons or for a longer amount of time.

11. Employer Of Record service terms

There is no information about the Employer of Record (EoR) service terms for this country.

Employment contracts

Ethiopia’s labor laws stipulate that you should include the following information in your contract at a minimum:

Employer name and address

Employee age, address, name, and work card number, if any

Agreement between the contracting parties in adherence to regulations

Signatures of all contracting parties

With Rivermate being your Employer of Record (EoR) in Ethiopia, you do not have to worry about the employment contracts, as we take care of that.

Minimum assignment length

There is no set length for assignments. This is usually indicated in the employment contract for fixed-term employments.

Payment currency

Ethiopian birr (ETB)

United States Dollar (USD)

Euro (EUR)

13.Opening a subsidiary in Ethiopia

There is no information about the working hours for this country.

How to set up a subsidiary

Subsidiary laws

13. Why choose Rivermate as your Employer of Record / PEO in Ethiopia

Establishing an entity in Ethiopia to hire a team takes time, money, and effort. The labor law in Ethiopia has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into Ethiopia 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 (EOR) solutions in Ethiopia 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 Ethiopia via our Employer of Record (EOR) / PEO solution.

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