In This Guide
How to Hire Employees In Jordan
Hiring in Jordan for the first time can be overwhelming, especially when navigating unfamiliar employment laws. Whether you hire independent contractors, set up a legal entity, or use an EOR service, understanding the local employment landscape is crucial for success. SOURCEitHR’s comprehensive guide can help you get started if you’re hiring locally or relocating a team member.
Companies can hire employees in Jordan in the following three ways:
- Setting up a local entity. Entity establishment reduces risk exposure and enables direct hiring, but can be costly and time-consuming – making it less practical for companies seeking quick and flexible solutions for hiring in Jordan.
- Partnering with an Employer Of Record. An EOR, like SOURCEitHR, is a third-party entity that serves as the legal employer of your international workforce which hires, pays, and manages compliance with Jordan’s labor laws and tax regulations.
- Hiring independent contractors. Hiring contractors gives companies a flexible, affordable alternative to hiring local employees, though it involves unique misclassification risks.
Good To Know
Employment and Labor Laws in Jordan
Businesses can only operate smoothly in Jordan if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Jordan below, to avoid any compliance issues.
Employment Contract Requirements
Employment contracts are required to be in Arabic, though they may also be bilingual. It is mandatory for these contracts to be documented in writing and endorsed by both the employer and the employee. A comprehensive employment contract in Jordan must include the following elements:
- Job description
- Working hours
- Leave entitlements
- Commencement date
- Basic salary details
- Termination
- Contract duration
Onboarding Process
We can help you get a new employee started in Jordan quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information to SOURCEitHR and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to 6 weeks. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. SOURCEitHR’s payroll cut-off date is the 10th of each month unless otherwise specified.
Working Hours in Jordan
The standard working hours in Jordan are 8 hours per day and 48 hours per week, from Saturday to Thursday.
Overtime in Jordan
According to the Labor Law, as per Article 57, mandatory overtime is restricted to 30 days per year.
Probation Period in Jordan
Probationary periods in Jordan are optional. However, this probation period should not go beyond three months.
Employer of Record in Jordan
An Employer of Record (EOR) acts as the legal employer for workers in Jordan, taking on key responsibilities to ensure compliance with local labor laws and regulations. The EOR facilitates the hiring process for businesses that want to employ workers without establishing a legal entity in the country.
The employer of record in Jordan is responsible for:
- Employment Compliance: Ensure all employment contracts comply with Jordan’s labor laws and regulations, including proper classification of employees.
- Payroll Management: Calculate, process, and distribute employee salaries in accordance with Jordan’s payroll laws, including deductions for taxes and social security contributions.
- Tax Filing and Contributions: Handle the registration, filing, and payment of employer taxes and social security contributions to the relevant authorities.
- Employment Contracts: Draft and maintain compliant employment agreements, detailing salary, benefits, working hours, and termination terms in line with Jordan’s legal requirements.
- Benefits Administration: Provide mandatory employee benefits as required by Jordan’s labor laws, such as health insurance, pension contributions, and statutory leave.
Payroll Management in Jordan
Fiscal Year in Jordan
January 1 – December 31 is the 12-month accounting period that businesses in Jordan use for financial and tax reporting purposes.
Payroll Cycle in Jordan
The payroll cycle in Jordan is usually monthly, with employees being paid by the last working day of each month.
Minimum Wage in Jordan
The minimum wage for employees in Jordan is typically 1.51 JOD per hour, amounting to 290 JOD per month for a typical 48-hour work week.
Bonus Payments in Jordan
Jordan does not have a provision for a 13th-month pay, however some companies mainly banks pay up to 16 months.
Employment Social Security & Taxes in Jordan
Employer Social Security Contributions
Employer payroll contributions are generally estimated at an additional 14.25% on top of the employee salary in Jordan as part of the social security contribution.
Tax Type | Tax Rate |
---|---|
Social Security | 14.25% |
Employee Social Security Contributions
In Jordan, the typical estimation for employee payroll contributions cost is 7.5%.
Tax Type | Tax Rate |
---|---|
Social Security and Pension | 7.5% |
Individual Income Tax Contributions
Personal income tax rates in Jordan are applied progressively, ranging from 5% to 30% as detailed below. In addition, any amount exceeding JOD 200,000 of the annual taxable income for individuals will be subject to 1% as national contribution tax.
Income Bracket | Tax Rate |
0 – 5,000 JOD | 5% |
5,001 JOD – 10,000 JOD | 10% |
10,001 JOD – 15,000 JOD | 15% |
15,001 JOD – 20,000 JOD | 20% |
20,001 JOD – 1,000,000 JOD | 25% |
1,000,001 JOD And above | 30% |
Pension in Jordan
In Jordan, the retirement age is set at 60 years for males and 55 years for females. An old-age pension is granted to an insured individual who has reached their retirement age and has made a minimum of 180 contributions, with at least 60 of them being actual contributions.
- The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in Jordan tailored to your needs.
Work Permits & Visas in Jordan
In Jordan, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key work permit types include the General Work Permit, which applies to most employment situations, and the Aqaba Special Economic Zone (ASEZ) Work Permit, designed for jobs within the ASEZ area and offering tax advantages. Employers must act as sponsors for foreign employees, ensuring compliance with Jordanian labor laws, including the submission of medical, police, and educational documentation.
Annual Leave & Company Policies in Jordan
Mandatory Leave Entitlement in Jordan
The annual leave entitlement in Jordan is 14 days for a full-time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.
Public Holidays In Jordan
In Jordan, there are 10 national holidays that are celebrated as public holidays. The specific holidays may vary, but they commonly include:
Holiday | Date |
---|---|
New Years Day | 1 January |
Easter Sunday | April, day changes yearly |
Easter Monday | April, day changes yearly |
Eid al-Fitr Holiday | April, days change yearly |
Labour Day | 1 May |
Independence Day | 25 May |
Eid al-Adha Holiday | June-July, days change yearly |
Islamic New Year | July, day changes yearly |
Prophet Muhammads Birthday | September, day changes yearly |
Christmas Day | 25 December |
Paid Time Off in Jordan
Every employee is entitled to an annual leave with full pay lasting for 14 days per year of service, unless a longer duration is mutually agreed upon. If an employee completes five consecutive years with the same employer, the annual leave period extends to 21 days.
Maternity Leave in Jordan
Pregnant employees have the right to take maternity leave with full pay both before and after delivery, totaling 10 weeks. This maternity leave is covered by the social security’s maternity insurance scheme.
Paternity Leave in Jordan
Employees are entitled to a paternity leave of three days, and this leave is fully paid by the employer.
Sick Leave in Jordan
Employees have the right to paid sick leave for a duration of up to 14 days, with the employer covering 100% of the payment. If an employee requires hospitalization, they are entitled to an additional 14 days of sick leave, with the employer covering 50% of the payment during this extended period.
Parental Leave in Jordan
Jordanian labor laws do not provide for shared parental leave that can be divided between parents. The existing provisions are specific to maternity and paternity leave, with no combined parental leave policy in place.
Employment Termination and Severance Policies in Jordan
Termination Process in Jordan
A contract of employment can be terminated based on various factors, as outlined in the labor code and employment regulations. The termination of a contract may occur under the following circumstances:
- Mutual Agreement
- Expiration of Contract Duration
- Breach of Contract
- Incapacity due to Disease or Disability
- Death of the Employee
Notice Period in Jordan
In Jordan there is a 30-day notice period for termination, and the type of notice depends on the type of termination, and subject to labor law requirements which are a maximum compensation of 6 months’ salary. No notice is needed during the probation period, and limited-term contracts cannot be terminated before their completion.
Severance in Jordan
Workers not covered by the Social Security law in Jordan are entitled to receive severance, paid as “end of service compensation.” This compensation is calculated at a rate of one month’s pay for each year of service.