Mauritius: A Land of Opportunities for Foreign Employees
What Mauritius has to offer?
As per the estimated figures of Statistics Mauritius, Mauritius hosted around 30,000 foreign employees in 2021. Apart from its luxury hotels, beaches and lagoons, tropical climate and the Chamarel "seven-colored earth", the island has much more to offer. Unlike many other island jurisdictions, Mauritius has a real domestic economy which is quite dynamic. It also has a well-established legal framework for employees and, above all, offers safety.
Considered as the safest country in Africa by the 2022 Global Peace Index, Mauritius positions itself as a perfect destination for professionals wishing to explore the Mauritian market and for long-term relocation.
This article aims to provide an oversight of the different provisions that may be of particular interest to a foreigner who is seeking employment in Mauritius.
Non-Citizens (Employment Restriction) Act 1970
In order to be able to engage in any self-employed occupation in Mauritius for reward or profit, or be employed in Mauritius, a non-citizen needs to hold a valid occupation permit, residence permit or permanent residence permit.
It is an offence if a non-citizen takes up any occupation or is employed in Mauritius without holding a valid permit in relation to that occupation or employment, and shall, on conviction, be liable to a fine of not less than MUR100,000 but not more than MUR500,000 and to imprisonment for a term not exceeding five years.
Workers’ Rights Act 2019 (“WRA 2019”)
This is the main legislation that governs the rights of all employees in Mauritius. The WRA 2019 has been enacted to protect employees and their interests in Mauritius.
Apart from the standard maternity, paternity and other leaves available to employees, Mauritius provides an end of year bonus or gratuity, which is commonly called the 13th month bonus. It is a mandatory payment to all employees, effected every December.
Employees earning a monthly basic salary of MUR100,000 or less and who remain in continuous employment with an employer for the whole or part of a year, are eligible for a statutory end of year bonus equal to one twelfth of their earnings for that year.
In contrast, employees earning a monthly basic salary in excess of MUR100,000, are eligible for a bonus to be paid in accordance with the End of Year Gratuity Act 2001. Under the said legislation, employees in employment as of 31 December in any given year become entitled to one-twelfth of their December basic salary multiplied by the number of months of continuous employment in that year.
There are certain deductions that are made from the salary of employees, notably the social contribution and national savings fund (NSF).
Social contribution rate
For employees earning a basic wage/salary or prescribed end of year bonus/gratuity not exceeding MUR50,000 in a month, the rate to be deducted from the wage/salary of the employee is 1.5% while the rate payable by the employer is 3%.
For employees earning a basic wage/salary or prescribed end of year bonus/gratuity exceeding MUR50,000 in a month, the rate to be deducted from the wage/salary of the employee is 3% while the rate payable by the employer is 6%.
For self-employed individuals, the minimum monthly social contribution is MUR150. For those who earn in excess of MUR10,000 and up to a maximum of MUR50,000 per month, social contribution at the rate of 1.5% of 90% of net income for that month is payable. For those who earn in excess of MUR50,000 as income per month, Social Contribution at the rate of 3% of 90% of net income for that month is payable.
The social contribution caters for payment of a number of benefits including retirement benefits to non-citizens if they have:
If a non-citizen leaves Mauritius for a continuous period exceeding six months in any consecutive 12-month period, they may elect to defer the retirement benefit until they return to reside Mauritius or receive, in lieu of the retirement benefit, a lump sum payment determined in accordance with applicable laws.
From July 2022, employees and the self-employed (including non-citizens) whose emoluments (excluding exempt income and any statutory end of year bonus, if applicable) do not exceed MUR50,000 in a month, are entitled for the financial year ending June 2023 to a social contribution income allowance of MUR1,000 per month.
The employee and employer share of monthly contributions are 1% and 2.5% respectively but capped on the first MUR21,255 of basic salary.
The NSF is there to provide for the payment of a lump-sum to every employee on their retirement or in case of death. On retirement, expiry of their contract of employment or work permit, or termination of their employment, a foreign employee will be entitled claim the lump-sum accumulated in their NSF account.
What is severance allowance?
In general, employees are well protected in Mauritius against any unjustified termination of their employment. Employees who have been in continuous employment for a period of not less than 12 months are eligible to severance allowance in the event of an unjustified dismissal, as are foreign employees. The maximum liability of an employer upon the unjustified termination of an employee is usually three months remuneration per year of service. Remuneration will be everything that can be quantified, including benefits and perks.
However, no severance allowance is payable to migrant workers or non-citizen workers employed under one or more contracts of fixed duration at the expiry of their contract.
Where a non-worker is paid, at the end if every period of 12 months or at the end of each contract of employment of a determinate duration, a gratuity, compensation or such other payment is provided, in lieu of pension or in respect of their length of service. The non-worker will not be entitled to the payment of any severance allowance on the expiry of a contract.
The different types of permits
There are different types of permits offered by the Economic Development Board (EDB) to foreigners who wish to relocate to Mauritius. The occupation permit (OP) is a combined work and residence permit allowing foreigners to work and reside in Mauritius under four general categories, namely:
The occupation permit application process
In order for a foreigner to be able to legitimately work in Mauritius, they must possess the appropriate permit to do so. The permit certifies that the holder is eligible to stay and work for the relevant duration depending on the type of permit.
The EDB is the authority that deals with the application and issuance of the OP.
occupation permit – professional
A professional, as defined under the Immigration Act 1970, is a foreign national employed in Mauritius by virtue of an employment contract and registered as such with the EDB.
The criteria in order to be registered as a professional are:
Upon a successful application, a Professional OP is issued for a maximum period of ten years depending on the duration of the contract of employment. The fees for an OP depend on the length of employment. For employment of up to two years, the permit fee is MUR15,000 while for employment of more than two years but not exceeding ten years, the fee is MUR20,000. Dependents of the Professional OP holders may also apply for residence permit for a duration not exceeding that of the main holder.
The employment contract, duly signed by both the employee and employer, should clearly mention the applicant’s full name as per birth certificate, company’s name, job title, duration of the contract of employment and monthly basic salary.
What happens if the professional changes employment?
Should a professional want to switch job from one company to another, a new application will need to be made to the EDB.
What if the professional ceases employment?
Where a professional holding a valid OP permit ceases employment, either the OP holder or their employer should inform the EDB in writing. The OP holder will have six months to leave Mauritius as from the date he ceased employment. In that time, the OP holder may apply for another job to the EDB. Should they be successful in finding another job, this job will need to satisfy the relevant criteria that an OP necessitates, as mentioned above.
The renewal of an occupation permit
A professional OP holder may apply for a renewal of their permit and the application for renewal must be submitted at least one month before the expiry of the OP.
Short-term occupation permit
Professionals may also apply for a short-term OP for a maximum period of nine months. This very distinctive permit may be extended only once for a period not exceeding three months. Should the professional want to shift from a short-term OP to a long-term OP, an application will have to be made for an OP.
The application process may take up to three to four weeks, provided that the documentation for submission is in order.
Young professional occupation permit
The EDB also offers a specific type of permit for young professionals as provided in Section 13 of the Economic Development Board Act 2017 and Section 9A of the Immigration Act 1970. This type of permit mainly concerns young foreign students from various jurisdictions and it provides a unique opportunity to these young students to take up employment after completing their tertiary studies in Mauritius.
In order to qualify for the young professional OP, the applicant must have been a foreign student who must have at least completed an undergraduate degree in Mauritius in biotech, fintech, robotics, financial services, IT or such other field as the minister may approve. Most importantly, the application must be submitted not later than six months after the date of publication of results.
The young professional OP is valid for a period of three years depending on the employment contract of the young professional. The application needs to be done by the employer and this is to be done via email to the EDB. If the employer wishes to retain the young professional beyond this duration of three years, they can make an application to the EDB for a professional OP.
While a contract of employment is a requisite in the application process for such a permit, there is no minimum salary requirement which needs to be satisfied, but instead the young professional will be subjected to the national minimum salary as provided by applicable local laws.
Self-employed occupation permit
"Self-employed" here refers to a non-citizen registered with the Registrar of Businesses under the Business Registration Act or operating as a one-person company engaging in professional activity in the the services sector.
A self-employed individual is required to make an initial investment of USD35,000 or its equivalent in foreign currency in Mauritius. In order to renew a self-employed OP, the business activity should generate a business income of MUR800,000 per year from the third year of registration. Most importantly, self-employed OP holders are allowed to employ local administrative staff.
Another type of permit which best suits a foreigner wishing for long-term relocation along with their family is the family OP. The application is to be made to the EDB and the purpose of this permit is to authorise:
A contribution of USD250,000 or its equivalent in foreign currency needs to be made by the applicant to the Mauritius COVID-19 Projects Development Fund.
Permanent residence permit
This is open to professionals and self-employed individuals, who have been in employment or gainful occupation as the case may be, for at least three years in Mauritius under an OP and subject to satisfaction of applicable conditions. Such type of permit offers a 20 year residency, which is renewable for another 20 years upon satisfaction of additional requirements.
Work from home (WFH)
Mauritius has not been spared from the impact of COVID-19 and the consequential effects on employment dynamics. WFH came to the fore in the ongoing pandemic and has enabled all stakeholders to maintaining the economy, retain employees and preserve employment.
To safely navigate to this "new normal", the government has left no stone unturned in relation to laws regulating such framework in the employment arena. The Workers’ Rights (Working from Home) Regulations 2020 (the "WFH Regulations"), applicable to workers earning MUR50,000 or less per month, regulates the manner in which both the employer and the employee can reap its flexibilities.
Under the WFH Regulations, an employer may ask a worker to work from home by giving notice of 48 hours and the worker shall comply with the instructions. If there is an agreed WFH arrangement with the employer, this agreement is in addition to the contract of employment and existing laws.
Workers will be able to recover work-related expenses and allowances for utilities such as internet and water, amongst others. They will also benefit from possible insurance arrangements given the employers’ obligations extend from the conventional offices to the homes of employees.
Employees and employers are also able to agree on hybrid arrangements where employees may work partly at the employer’s workplace and partly at home.
Remote working: are you a digital nomad?
Mauritius has embraced technological advancements regarding both working arrangements and the emergence of new working sectors. One of them is the digital nomad network.
A digital nomad lifestyle that combines work and travel is the dream for many and Mauritius has made this a reality. Based on data collected on high internet speed, health and safety, and social life, among others, Mauritius was rated as one of the best places in the world for remote working in 2022 according to a new "Work from Wherever Index" by KAYAK, being ranked first in the Middle Eastern and African region and fourth worldwide. According to official statistics of the EDB, such scheme has attracted around 1500 individuals and families in Mauritius.
Professionals who wish to stay in Mauritius for a period exceeding 180 days in a calendar year and relocate to Mauritius with their family while working remotely can do so through a long-stay premium visa. Such visa is valid for a professional intending to stay in Mauritius for a maximum period of one year with the option to renew, free of charge.
In order to qualify for the premium visa, the applicant must have:
The following criteria should also be met:
Can foreigners acquire property in Mauritius?
The Non-Citizens (Property Restriction) Act allows foreigners to purchase apartments in condominium developments. These apartments must be in developments made of at least two levels above ground (G+2) and the purchase price should not be less than MUR6 million or its equivalent in foreign currency.
Furthermore, upon the acquisition of a real estate property under the property development scheme, integrated resort schemes or the G+2 for an amount of not less than USD375,000 or its equivalent in any other currency, a residence permit is granted to the foreigner. This residence permit is valid for as long as the foreigner remains the owner of the property.
The Non-Citizens (Property Restriction) Act even allows foreigners, whether they hold a valid OP or not, to invest in more than one property. Interestingly, they are even allowed to rent the property out. They can get a combined OP and residence permit as an enterprising investor, professional or self-employed.
The future for foreign employees
As seen in this article, Mauritius offers a very clear, simple and attractive legal framework for foreigners as far as employment laws are concerned.
Foreign workers now benefit from high-end and advanced infrastructure, state of the art telecommunications, emerging job opportunities and well-regulated work culture. The panoply of interesting avenues presented to workers looking to maximize their productivity, enjoy a positive work-life balance and to foster their family environment, undoubtedly makes Mauritius an ideal destination for relocation.
Mauritius is now seen as a perfect destination for long-term relocation among international observers where a safe and secure work environment is provided in conjunction with legal, political and social stability and long may this continue.
We can only expect that after the COVID-19 pandemic, which has obviously not spared the economy of Mauritius, more incentives will be provided to foreign employees in the near future!