Practice Area Articles
January 16, 2023
Karen Fulton, Tshepo Mokoana and Tarika Patel
Back to International Employment Law
KEY DEVELOPMENTS FOR 2023
General Labor Law
A preliminary bill of the General Labor Law (“GLL”) is under discussion in the National Assembly of Angola. Currently, there is an urgent need for the GLL to comply with the international conventions and agreements ratified by Angola, seven years after the approval of the last GLL. The GLL approved in 2015 calls for harmonization with the guarantee and implementation of the legal and constitutional principles of job security and fair compensation. And, on the other hand, the diploma revealed itself, in the Angolan context, as an advance incompatible with the social and economic reality of the country, thus generating a mismatch between the social reality considered within the scope of normative predictability and the concrete social reality of the country.
The bill indicates that Angola registered, in real terms, an average quarterly reduction in the production of goods and services of 2.41%, between the 1st quarter of 2019 and the 2nd quarter of 2021. As expected, unemployment during the period increased by 5.33 percentage points from 28.8% in the 1st quarter of 2019 to 34.1% in the 3rd quarter of 2021. The bill seeks to reconcile the interests of employers, employees and society in general so that respect and observance of employees’ rights can be guaranteed. It is clear that respect and observance of employees’ rights cannot be a factor that discourages economic growth.
The main changes of this initiative relate to mandatory reduction of fixed-term employment contracts in writing; introduction of justification for entering into a fixed-term contract; the reduction of the duration limit of the contract for a fixed term; the introduction, in special contracts, of the figure of the Telework Contract and the Service Commission Employment Contract; the introduction of Personality Rights in the Project, especially Freedom of Expression and Opinion, Physical and Moral Integrity, Reservation of Privacy of Private Life and Protection of Personal Data, respectively; elimination of the distinction between companies based on their size in terms of the duration of a fixed-term contract; reconfiguration of the criteria for setting additional remuneration, as well as determining indemnities and compensation, to name a few. Employers should be sure to keep abreast of updates regarding the bill.
The regime for the exercise of work activity in telework was approved through Presidential Decree No. 52/22, of February 17, which regulates the situations that allow the adoption of this regime, as well as the cases in which its adoption is mandatory, and the form and content of the special contract to be concluded. Questions relating to work instruments, additional expenses, duties and rights of the worker, working hours and the right to privacy are also regulated. This diploma came into force on 19 March 2022; however, it has some gaps that we believe may be filled in the bill of GLL.
Increase in the national minimum wage
Presidential Decree No. 54/22, of 17 February, updated as of 17 February 2022, the value of the national minimum wage by economic sector. The national minimum wage was defined as (i) AOA 48,271.73 for the commerce and extractive industry sectors; (ii) AOA 40,226.44 for the transport, services and manufacturing sectors; and (iii) AOA 32,181.15 for agriculture and economic activities not included in the previous categories. The update of the determined national minimum wage represents an increase of around 50% of the minimum amounts previously defined by Presidential Decree No. 89/19, of March 21. In case the bill of GLL is approved in 2023, these amounts must be taken into account.
KEY DEVELOPMENTS FOR 2022
Proposed updates to the Civil Procedure Code
The proposed updates to the Civil Procedure Code, which would also be applicable to labour legal proceedings, set out an outline for a model of civil procedure that guarantees the certainty and security of the law based on the freedom and autonomy of the parties and the prevalence of material truth over formal truth. If passed, these proposals would simplify existing procedures and would ensure that the Civil Procedure Code more closely reflects the structuring principles of the Angolan Constitution.
Proposed updates to the General Labor Law
Proposals have been made to amend the new General Labor Law, which will revoke the Labor Law No. 7/15 of 15 June if passed. If the proposals are passed, one of the main changes the new law will bring is that it will establish distinctive regimes for large, medium, small and micro-sized companies. We understand that it will also include revisions in respect of the rules around compensation and indemnities to workers on termination of their employment contracts and other issues not yet raised at public level.
KEY DEVELOPMENTS FOR 2021
New regime on social protection for old age
Presidential Decree No. 299/20, of 23 November 2020, which defines the conditions for the entitlement of retirement and early-retirement pension and old-age allowance, was approved and came into force immediately. The new regime essentially maintains the qualifying periods, the length of service to be considered, as well as the calculation formulas for each allowance. There are, however, modifications on the exclusion of foreign employees, as well as on the calculation formula of the retirement pension and old-age allowance.
New social security regime for employees engaged in low-income activities
Presidential Decree No. 295/20, of 18 November 2020 approved a social security regime specific to employees engaged in low-income activities. The new regime introduces special contribution rates of only 4% for the employer and 1.5% for the employees, to be levied on all elements of pay, thus corresponding to only 50% of the respective general contribution rates. For the purposes of this statute, low-income activities are the ones carried out by agriculture, fishing, and commercial companies, in which the average monthly salary of the total workforce does not exceed 20 times the national statutory minimum salary for the agriculture sector, set at AOA 21,454.10 at the time of writing.
Creation of working group to propose measures on remuneration system in the oil sector
The Minister of Public Administration, Employment and Social Security, jointly with the Minister of Mineral Resources, Petroleum and Gas ("MIREMPEG"), approved Order No. 1903/20, of 24 April 2020, by means of which a working group was created with the purpose of analysing the remuneration systems currently practiced in the oil sector and proposing measures that would provide stability and equality and guarantee social peace within the industry's companies. The working group had sixty days to present a report on its activity to MIREMPEG.
KEY DEVELOPMENTS FOR 2020
Significant changes to immigration laws
New Regulations regarding the entry, exit, stay and residence of foreign citizens in Angola came into force on 8 June 2020. The new regime (approved by Presidential Decree No. 163/20, of 8 June 2020) introduces significant changes to the Angolan migration legal landscape, including clarification on the validity period of work visas, evidence required to ensure employers' compliance with the 70/30 quota before hiring any foreign non-residents and more restrictive rules regarding the grant of investor visas.
Increase in employment litigation
As a result of the global financial crisis, the unprecedented reduction in the price of oil, and the COVID-19 pandemic, companies have had no alternative but to carry out individual and collective redundancy processes. It is likely that such dismissals will lead to a substantial increase in employment litigation in Angola, particularly in light of new legislation that has been approved by the Government in connection with the COVID-19 outbreak.
KEY DEVELOPMENTS FOR 2019
Simplification of tourist visas
Nationals of the Republics of Botswana, Mauritius, Seychelles, Zimbabwe and Singapore are no longer required to hold a tourist visa when entering Angola for stays of up to 30 days per entrance and 90 days per year.
Nationals of other African countries, as well as those from America, Asia, Europe, and Oceania also benefit from a simplified regime as visa applications can now be submitted online through the official portal of the Angola Migration Services and will be issued within three business days.
Significant broadening of basis for social security contributions
A new Legal Framework for the Compulsory Social Protection Contribution (Presidential Decree No. 227/18, of 27 September 2018) came into force on 26 December 2018. The new framework significantly broadens the basis for the levying of contributions to the Social Security system. As a rule, this means that base salaries and other remuneration complements are subject to contributions to the Social Security system.
New public holidays
The Law on National and Local Holidays and Dates of National Celebration has been amended by Law No. 11/18, which came into force on 28 September 2018. This law introduced a new holiday on 23 March and a new day of national celebration on 15 January.