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Hiring in Saint Vincent and the Grenadines? Read on to find out the employment norms (like taxes, payroll and benefits) and EOR (Employer on Record) norms in Saint Vincent and the Grenadines.
Employment Norms in Saint Vincent and the Grenadines
According to the world bank, Saint Vincent and the Grenadines has a 'doing-business' score of 87. Besides, this Latin American country is a tax haven in the Caribbean region with provisions of foreign tax relief and no withholding tax. All these make it an ideal destination for business expansion. But, delving into business establishment here without assistance from EOR services is complex due to various legal requirements.
General Information:
- The currency of Saint Vincent and the Grenadines is the Eastern Caribbean Dolar ($, XCD).
- Kingstown is the capital of Saint Vincent and the Grenadines.
- English is the official language of Saint Vincent and the Grenadines. Documentation is done in English.
- As of 2021, the GDP of the country was reported to be 904.18 million USD.
Following the country's labor laws, employment norms, and other legislations is necessary for any business to prevent unnecessary legal implications. Hiring can be challenging without proper knowledge of its legislation.
Table of Contents
- Agreements
- Onboarding Process
- Visa
- Minimum Wage
- Payroll Cycle
- Annual Bonus
- Health Benefits
- Working hours and overtime
- Leaves
- Social Security
- Taxes for Employers
- Taxes for Employees
- Probation
- Termination
- Severance Pay
- Employees or Contractors
- Final Words
AgreementsOnboarding ProcessVisaMinimum WagePayroll CycleAnnual BonusHealth BenefitsWorking hours and overtimeLeavesSocial SecurityTaxes for EmployersTaxes for EmployeesProbationTerminationSeverance PayEmployees or ContractorsFinal Words
Agreements
- Both verbal and written contracts are legally binding in saint vincent and Grenadines.
- However, a written contract is mandatory except for daily and weekly paid employees.
- The terms and conditions of the contract should include the following headings.
- Commencement date of the employment
- The name and address of the employer and employee
- Payment rate, overtime pay, and pay period
- Probation period
- Working hours and Rest hours
- Vacation and leaves
- Duties of the employee
- The employer must provide a written contract with the provisions above within 7 days after employment commencement.
- If not, the employer is punished with a penalty not exceeding EC$ 1000.
- The legal language of the contract is English.
- Employment contracts are fixed type, part-time, indefinite, probationary, casual, apprenticeship, and project-based.
Onboarding Process
- There are no specific laws regarding the onboarding process in St Vincent and Grenadines.
- The practices and principles of the labor code generally guide it.
- However, the company may ask to verify IDs and other documents as required.
- Similarly, the onboarding process might involve paperwork, including tax and employee benefits forms.
Visa
Saint Vincent and the Grenadines have various types of Visas. The Ministry of National Security provides visas in St Vincent and Grenadines.
- Transit Visa - Provided for a transit pass
- Short-stay Visa - Provided for EU nationals for 90 days
- Business Visa - Issued by the Ministry of Finance, Economic Planning, Sustainable Development, and Information Technology
- Student Visa
- Humanitarian Visa
- Tourist Visa
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Minimum Wage
The minimum wage in St Vincent and Grenadines varies according to the employment sector.
- Agricultural workers (no shelter) - EC$56 per day ($20.74)
- Industrial Workers - EC$40 per day ($14.81)
- Domestic Workers - EC$25 per day
Payroll Cycle
The payroll cycle in Saint Vincent and the Grenadines varies and depends on the contract. However, it can be weekly, bi-monthly, and monthly.
Annual Bonus
There are no statutory provisions for an annual bonus in St Vincent and Grenadine.
Health Benefits
- The National Insurance Service Act governs health benefits schemes.
- There is generally no practice of private insurance.
- The National Insurance Service provides Health care assistance.
- However, the employer must register the employee's name in the office to receive the service. The employer must complete the task within 7 days after the commencement of the job.
Working hours and overtime
- Work hours: The work hour varies between 44-48 hours per week based on industry type.
- Domestic workers with living accommodation- Maximum 11 hours per day Domestic Workers with no accommodation- Maximum 10 hours per day
- Nursing Home Workers- 8 hours per day
- Child caregiver- 8 hours for 5 days a week
- Break: 2 hours break for domestic workers
Overtime: The overtime pay is 150% of the regular rate. Any industrial and agricultural labor work done on Sunday is paid at 200% of the regular rate.
Leaves
Sick leaves
- A domestic worker with 6 months of continuous service enjoys 14 days of paid sick leave per year from the employer.
- In case of surgical or therapeutic care or any medical conditions requiring rest, a domestic worker shall enjoy 30 days of sick leave a year. However, it must be verified by the medical practitioner.
Parental leaves
- There is no provision for paid parental leaves.
- However, a domestic worker with 2 years of continuous service can avail of paid maternal leave of 4 weeks. It is paid at 35% of the regular rate by the employer.
Annual leaves
- Except for employees hired daily, others shall enjoy the following annual leaves.
- 1-5 service years- 14 days
- 6-10 service years - 21 days
Public Holidays (for the Calendar year 2023)
- New Year's Day (1st January)
- National Heroes Day (14th March)
- Good Friday (10th April)
- Easter Monday (13th April)
- Labor Day (1st May)
- Whit Monday (1st June)
- Emancipation Day (1st August)
- Carnival (3rd & 4th August)
- Independence Day (27th October)
- Christmas Day (25th December)
- Boxing Day (26th December)
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Taxes for Employers
- For non-resident employers, the taxable income is the one generated within the jurisdiction of St Vincent and Grenadines.
- For International Business companies, there is zero tax policy for income made outside the country's territory.
- There is no payroll tax in St Vincent and Grenadines.
- The social contribution tax rate for employers is 5.5%.
- Companies are liable to pay 5% of the property tax based on the property's market value. The tax is imposed annually and must be paid between 1st July and 30th September.
Corporate Taxation
- Corporate Income Tax Rate- 30%
- Branch Tax Rate- 30%
- Capital Gains Tax Rate- 0%
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Taxes for Employees
- The individual tax rate is based on marginal income brackets that increase progressively.
- For residents, tax is imposed on worldwide income. Individual residency is based on the presence in the country for days exceeding 183.
- There is no provision for joint filing of tax returns for spouses in Saint Vincent and Grenadines.
Employees are required to pay taxes based on the following criteria.
- Upto XCD 5,000 = 10%
- XCD 5,001 - 10,000 = 20%
- XCD above 10,000 = 30%
Probation
The probation period lasts for a maximum of 6 months in Saint Vincent and Grenadines.
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Termination
- The employer can terminate the employment if:
- Employees are found guilty of misconduct or unsatisfactory performance.
- However, for such terminations, a prior written warning must have been given twice in the presence of witnesses.
- If the employees do not improve within 3 months after warning in case of unsatisfactory work.
- Employees found guilty of Criminal offense.
- Conditions contravening the existing laws.
Severance Pay
The rate of severance pay varies depending on the period served. Generally, employers pay severance pay if the job is terminated due to redundancy or illness.
- 2-10 years of continuous service = 2-week pay
- 11-25 years of continuous service = 3-week pay
- 25 years plus of continuous service = 4-week pay
Employees or Contractors
- Misclassifying employees and contractors may bring in issues in the taxation system, insurance policy, and competitive benefits of the workers.
- Misclassification may cause a violation of the Income Tax Act, which may cause penalties to employers.
- Also, misclassifying employees as contractors is a punishable act.
Final Words
Expanding business in Saint Vincent is ideal due to its liberal tax policies. However, the overall process is complex as one requires a business entity, bank account, etc., within the country's jurisdiction. Thus, consulting EOR services is recommended for easy business establishment in Saint Vincent and the Grenadines.
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