Once you have decided to expand into Africa, winning new customers isn’t necessarily going to be a big challenge because of the growing demand for innovative products and services across the continent. The real challenge is aligning your employment and day-to-day operation strategies with each country’s rules and regulations. It is critical to understand that an employee hired to work in any African country will be subject to that country’s local employment laws.
Companies that are not familiar with the local labour laws or guidelines in the African country they are operating in are at risk of compliance issues that can lead to negative legal consequences. This is why you must stay up-to-date with the current trends in the African labour law or risk exposure to compliance risks, but constant changes make it difficult for companies to keep up. It is important to know what to expect and prepare your expansion strategy accordingly. One foreign labour consideration that can be easily overlooked is minimum wage which influences the minimum salary employees should be paid in Africa. Keep reading to discover the minimum wages across eleven African countries.
Minimum Wage in Africa: Top 11 African Countries
The national minimum wage for federal workers in Nigeria increased by 62.2% in 2020 to 30,000 NGN (79 USD) per month from 18,500 NGN (49 USD), but this became the law in 2019.
While the new minimum wage was implemented across board in the public sector, it must be noted that the private sector operates with a different template, which may mean that minimum wage would be complied with but not necessarily adjusted across board for all sectors.
Currently, Ghana’s minimum wage stands at 319.14 GHS per month (55.55 USD), representing an 11% increase from 287.55 GHS per month (50.05 USD) in 2019.
The minimum wage in the country has progressively increased from 2010 onwards. Overall, the 2003 Labor Act mandates the Ghana National Tripartite Committee to determine the national daily minimum wage.
In South Africa, the national minimum wage was first implemented on the 1st of January 2019 at a level of 3,897 ZAR (259.27 USD) per month; this was later adjusted to 4,045.09 ZAR (269.25 USD) per month on the 1st of March 2020.
On the 1st of March 2021, the national minimum wage in South Africa was increased by 4.5% from 4,045.09 ZAR per month to 4,226.30 ZAR (281.5 USD) per month.
Lower minimum wages were established for farm and domestic workers, with gradual equalisation to the national minimum wage over time.
- Farmworkers – 4,226.30 ZAR (281.5 USD) per month, which is now equal to the national minimum wage, after earning 10% less in the past year.
- Domestic workers – 3,719.69 (247.78U USD) ZAR per month
- Workers on an expanded public works programme – 2,324.56 ZAR (154.83 USD) per month.
Cameroon’s minimum wage is 36,270 CFA (63.2 USD) francs per month, applicable to all employees in all sectors. Cameroon’s minimum wage was last changed on 30-Jul-2014 with a 9.11 % increase from the previous year.
The country has the lowest minimum wage in Central Africa, despite being the continent’s driving force. Historically, the monthly Minimum Wage in Cameroon reached an all-time high of 63.2 USD per month in 2014 and an all-time low of 32.6 USD per month in 2001.
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Currently, the minimum wage in Kenya is 13,572 KES (123.78 USD) per month. Minimum Wage in Kenya averaged 6522.44 KES/Month from 1994 until 2020, reaching an all-time high of 13,572 KES/Month in 2018 and a record low of 1700 KES/Month in 1994.
The minimum wage in Kenya is lower than the average living wage for an Individual in Kenya which increased to 22300 KES/Month in 2018 from 21400 KES/Month in 2017.
Sierra Leone’s minimum wage increased from 500, 000 SLL (49.02 USD) per month to 600,000 SLL (58.82 USD) per month for all employees on the 1st of January, 2020. There are over 100 countries with a higher Minimum Wage than Sierra Leone.
The minimum wage in Egypt increased to 2,000 EGP (115.74 USD) per month on the 1st of April, 2019, from 1,200 EGP (69.27USD). Minimum Wages in Egypt averaged 1192.78 EGP/Month from 2009 until 2020, reaching an all-time high of 2000 EGP/Month in 2019 and a record low of 35 EGP/Month in 2009.
In Senegal, minimum wage rates are determined separately for both agricultural and non-agricultural sectors. The minimum wage for the Agricultural sector is 41,748 CFA (75.63 USD) per month, effected from the 1st of July, 2018. While the minimum wage for the Non-agricultural sector is 54,904 CFA (99.46 USD) per month, effected from the 1st of January, 2019.
The Minimum wage in Cote D’Ivoire rose from 36,600 CFA Francs (75 USD) per month to 60,000 CFA (120 USD) per month on November 20, 2013 for the first time since 1994. The 61% increase is not expected to significantly impact workers’ wages as so few are paid the minimum, which is far from enough to live on in Côte d’Ivoire.
There is no national minimum wage in Ethiopia. However, some government institutions and public enterprises set their minimum wages which is around 420 ETB (22 USD).
Tanzania’s minimum wage is set by segments, covering various employment sectors. The minimum wage per month for some major sectors include:
- Health services – 80,000 TSH (34.50 USD)
- Agricultural services – 70,000 TSH (30.19 USD)
- Commerce, Industry and Trade – 80,000 TSH (34.50 USD)
- Aviation Services – 350,000.00 TSH (150.93 USD)
- Clearing and Forwarding – 230,000 TSH (99.18 USD)
- Telecommunication – 300,000 TSH (129.37 USD)
- Inland Transport – 150,000 TSH (64.68 USD)
- Mining, License/ prospecting licenses – 350,000. TSH (150.93 USD)
- Primary mining Licenses/Prospecting licenses – 150,000 TSH (64.68 USD)
- Dealers licenses/ Lapidary 250,000 – (107.81 USD)
- Brokers licenses – 150,000 TSH (64.68 USD)
- Marine and Fishing – 165,000 TSH (71.15 USD)
Tanzania’s minimum wage was last changed on the 1st of January, 2013.
Ensure Compliance with Every Minimum Wage in different African Countries
Following and keeping apprised of changes to wage requirements in the various African countries can be tasking. Failure to comply with labor laws can result in financial penalties and lawsuits; this is why it is critical to stay on top of these issues, as labor and employment regulations are among the easiest to violate.
For companies expanding into Africa, turning to a Professional Employer Organisation simplifies international compliance. Establishing a partnership with a local Professional Employer Organization (PEO) will help your company reduce risks with labor-related compliance and liability issues.
African Ally’s employment expertise in different African countries helps companies navigate hiring challenges across Africa. Reach out to us today to find out how we can support your expansion into Africa.