Papua New Guinea

Employer of Record (EOR) in Papua New Guinea

Only 399 EUR per employee per month

Rivermate's Employer of Record (EOR) solution helps companies hire remote employees in Papua New Guinea . 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 Papua New Guinea.

Employer of Record people
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Currency
Papua New Guinean Kina
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Capital
Port Moresby
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Region
Oceania
Megaphone
Language
English
Hire remote employees
Population
8947024
A pile of gold
GDP
$20.54 billion
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GDP growth
0.0255
Business suitcase
Ease of doing business
59.8
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World GDP share
0.0003

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

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 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

Papua New Guinea, formally the Independent State of Papua New Guinea (Tok Pisin: Independen Stet bilong Papua Niugini; Hiri Motu: Independen Stet bilong Papua Niu Gini), is an Oceanian republic consisting of the eastern half of the island of New Guinea and its outlying Melanesia islands (a region of the southwestern Pacific Ocean north of Australia). Port Moresby, on the country's southern coast, serves as its capital. With an area of 462,840 km2, the nation is the world's third-biggest island republic (178,700 sq mi).

At the national level, Papua New Guinea achieved its sovereignty in 1975 after being governed by three foreign countries since 1884. This was the culmination of over 60 years of Australian administration, which began during World War I. In 1975, it became an autonomous Commonwealth nation, with Elizabeth II as its monarch. It also became an independent member of the Commonwealth of Nations.

Papua New Guinea is one of the world's most linguistically varied nations. The nation has 851 recognized languages, 11 of which have no known speakers. As of 2019, it is also the most rural, with just 13.25 percent of its population residing in metropolitan areas. The majority of the more than 8,000,000 people live in traditional communities, which are as different as the languages. Culturally and geographically, the nation is one of the least explored in the globe. It is believed to contain several uncontacted peoples, and scientists think there are many unknown plant and animal species in the interior.

The International Monetary Fund classifies the sovereign state as a developing economy. Almost 40% of the population lives a self-sufficient natural lifestyle with no access to global money. The majority of the population is divided into strong traditional social groupings focused on farming. Their social life includes traditional religion as well as contemporary activities such as basic schooling. The Papua New Guinea Constitution specifically recognizes these societies and clans, expressing a desire for "traditional villages and communities to exist as viable parts of Papua New Guinean society" and ensuring their continued relevance to local and national community life. Since 1976, the country has been an observer state in the Association of Southeast Asian Nations (ASEAN), and it has applied for full membership. It belongs to the Commonwealth of Nations, the Pacific Community, and the Pacific Islands Forum.

Hiring talented employees in a short span is not an easy task. Partnering with an Employer of Record (EOR) like Rivermate in Papua New Guinea 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

Public holidays

Sick days

Maternity leave

Paternity leave

Parental leave

Other leave

5. Employment termination

There is no information about employment information for this country.

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.

Probation period

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

Severance pay

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

6. Working hours

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

General working schedule

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

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.

7. Minimum wage

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

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.

8. Employee benefits

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

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.

9. Taxes

There is no information about the taxes for this country.

Corporate tax

Companies based in PNG are subject to income tax on their global earnings. Companies that are not based in Papua New Guinea are only obliged to remit tax on revenue generated in the country. WHT may apply to a non-passive resident's income derived from PNG, such as dividends, interest, and royalties. Normally, the payer of the dividend, interest, or royalty must withhold the applicable tax and submit it to PNG's Internal Revenue Commission (IRC).

Corporate income tax (CIT) is levied on a flat rate basis in Papua New Guinea. Trading profits and other income (unless income expressly exempted) of resident businesses in Papua New Guinea are generally taxed at a rate of 30%, while non-resident corporations operating in Papua New Guinea are taxed at a rate of 48%.

Individual income tax

Papua New Guinea residents are taxed on their global income. There may be a foreign tax credit available to balance foreign tax paid against PNG tax due.

Non-residents are usually solely taxed on income earned in PNG. WHT may apply to a non-PNG-sourced resident's passive income, such as dividends, interest, and royalties. The recipient of the dividend, interest, or royalty must withhold the applicable tax and submit it to PNG's Internal Revenue Commission (IRC).

For a taxable income of up to PGK 12,500, the tax rate is set at 22 percent.

For a taxable income between PGK 12,500 to PGK 20,000, the tax rate is set at 30 percent.

For a taxable income between PGK 20,000 to PGK 33,000, the tax rate is set at 35 percent.

For a taxable income between PGK 33,000 to GPGK 70,000, the tax rate is set at 40 percent.

For a taxable income between PGK 70,000 to PGK 250,000, the tax rate is set at 42 percent.

The rates imposed on taxable non-residents range from 22 percent to 42 percent on the taxable income.

VAT, GST and sales tax

The GST rate is 10% and applies to the majority of products and services sold in Papua New Guinea. GST is not levied on products and services that are exported. Some products and services, such as medical, educational, and financial services, are excluded. Although land is exempt from GST, buildings and other improvements are.

There is also a program for deferring import GST. Taxpayers who want to participate in the import deferral program must apply for permission from the IRC and have a solid track record of tax compliance.

Directors of businesses who fail to comply with GST duties face a penalty equivalent to the outstanding tax amount that the company should have paid to the IRC.

10. VISA and work permits

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

Papua New Guinea is one of the world's most undervalued tourist destinations, with over 700 languages, varied ethnicities, beautiful scenery, and the purest waterways. The visa policy of Papua New Guinea enables individuals from all over the globe to enter the nation without trouble.

All visitors to Papua New Guinea will need a visa and a valid passport to enter the country. Those who are unable to get a Papua New Guinea visa may apply for one via one of the several PN embassies. During their stay in Papua New Guinea, all tourists must hold a passport that is valid for at least six months.

There are no exceptions to the present Papua New Guinea visa policy, which requires all foreign people entering the country to get a visa. Nationals from up to 75 countries across the globe may now apply for a Papua New Guinea visa online using a simple online application form.

Aside from this approach, there are various additional options for obtaining travel authorisation for your stay in Papua New Guinea. The online option is a lifesaver since it saves you the trouble of standing in lengthy lines or traveling all the way to the Papua New Guinea embassy in your own country.

Visitors coming to Papua New Guinea may remain for 30 to 60 days with the use of an electronic visa. The length of your visa is determined on the nature of your stay and your nationality. If you want to remain in Papua New Guinea for a longer amount of time, you must apply to the embassy for a consulate visa.

According to the current Papua New Guinea visa regulations, more than 170 nations are eligible for a Papua New Guinea diplomatic visa. All visitors who desire to remain in Papua New Guinea for more than 60 days must apply for a special visa.

If you want to visit Papua New Guinea for business or pleasure, this is the visa for you. You will be able to see the greatest vistas and excursions in Papua New Guinea with the aid of their short-term visa, and you will also be allowed to see your friends and family members in the nation.

All members who are qualified for a Papua New Guinea diplomatic visa are also eligible for a tourist visa to the nation. All of these nations may apply online and get their tourist visa in a relatively short period of time. If you ask for PNG approval for your electronic visa, the process might take 30 to 60 days, depending on the reason of your trip.

You will get the approved visa through the email address you provided in your application form in no time. Members of up to 75 nationalities may apply for an electronic tourist visa to Papua New Guinea under current guidelines. Other family members may apply for a Papua New Guinea visa via the embassy.

11. Employer Of Record service terms

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

Employment contracts

Employment contracts in Papua New Guinea might be written or verbal, according to labor legislation. While an employment agreement may be formed orally, you must preserve a written record of the provisions contained in the contract. If you write the employment contract, you must prepare two copies: one for your records and one for the employee.

Employment contracts may be for a set period of time or for an indefinite period of time, and they must contain all necessary employment information. The following details are included in this information:

The identities of both sides

Workplace Location and Duration of Employment

Wages and methods of payment

The nature of the task done

With Rivermate being your Employer of Record (EoR) in Papua New Guinea, 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

Papua New Guinean Kina

13.Opening a subsidiary in Papua New Guinea

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

How to set up a subsidiary

A limited liability company will be formed when you establish a subsidiary in Papua New Guinea. The government enables any corporation to be entirely controlled by a nonnational, however certification is required.

The procedure of establishing a subsidiary begins with registering your business name with the Investment Promotion Authority (IPA). This procedure may be completed online or with a paper form. If your company has 50% or more nonnationals, you must also apply for accreditation with the IPA.

You have 14 days after registering your business name to register for your international certification. The processing period for this certification may range from four to eight weeks, but once you obtain it, you'll be ready for the following stages.

As a legal entity in the nation, you must apply for a tax identification number (TIN) with the Internal Revenue Service (IRC). With your TIN, you will be able to pay company taxes and deduct taxes from your workers' salaries.

If you have 15 or more workers, you must additionally register with the National Superannuation Fund. Your membership will enable you to make donations on behalf of your employees.

Subsidiary laws

To be a legal entity, your firm must have at least one director and one shareholder. You will also need at least one share. There are no criteria for secretaries, and nonnationals may hold all of these roles provided they obtain IPA certification.

Papua New Guinea, unlike many other nations, does not need a memorandum and articles of association to incorporate. While a constitution is not required for your business to exist, it is great practice to specify how you will govern your corporation to keep all members on the same page.

A physical address is also required under the Companies Act. A P.O. box does not fulfill this criteria, thus you must have a physical location to do business and the necessary licenses before registering for incorporation.

13. Why choose Rivermate as your Employer of Record / PEO in Papua New Guinea

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 (EOR) 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 (EOR) / PEO solution.

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