How to Hire Remote Employees In 

Jamaica

The Basics

Currency
Jamaican Dollar (JMD)
Employer Taxes
12.50%
Payroll Frequency
Monthly
Official Language
English

Employment in 

Jamaica

Hire Independent Contractors

Independent contractors or freelancers are self-employed individuals who provide services to companies as a non-employee. This is one of the most common ways companies tend to hire non-local designers, engineers, support reps, etc.

For legal and tax purposes, independent contractors are not classified as employees. They may work for multiple clients, set their own work hours, negotiate their pay rate, and decide how a job gets done.

For example, the IRS says that if an independent contractor or freelancer does work that can be controlled (what will be done and how it will be done) by an employer then they are, in fact, classified as an employee.

As you can imagine, hiring someone as an independent contractor versus an employee is a fine line to tread.

While there are benefits when you choose the contractor route, there are quite a few drawbacks to consider and you’ll need to weigh them carefully to determine the best fit for your company.

Benefits of Hiring Independent Contractors
Reduced overhead: Lower cost in expenses, payroll, benefits, and more.
Greater flexibility: Contractors can be brought on as-needed. If not a good fit, you simply don’t have to move forward with the contract.
Reduced legal risk: Contractors aren’t usually protected by employment anti-discrimination and workplace safety laws.
Disadvantages of Hiring Independent Contractors
Risk of Misclassification: Not only does this deny workers their proper protections, it can also result in steep penalties and damage to your company. If the IRS determines that employee misclassification has occurred, you will be liable for a percentage of the employees wages, FICA contributions, penalty fines, unpaid taxes, up to a year in prison, and more.
Lack of Control: Contractors are drawn to being independent because it gives them greater control over the work they perform and who they work with. Because they’re not employees, you can’t tell them what to work on and how it should be done.
Lack of Loyalty: Contractors come and go as-needed. Many companies hire contractors for short-term work, which makes it difficult to cultivate loyalty.
Increased Scrutiny: Using Independent Contractors typically leads to an increased risk of being audited.

Set up a subsidiary in 

Jamaica

A foreign subsidiary is a company that operates overseas as part of a larger company who’s HQ is in another country.

Establishing a foreign entity is great for having an international presence and accessing new markets. Though, setting up a subsidiary in Jamaica can be expensive, stressful, and time-consuming. It's not for the faint of heart.

To set up a subsidiary in Jamaica, you have to:

  1. Register your business name and file articles of incorporation
  2. File for local bank accounts
  3. Learn and keep track of the local employment laws
  4. Set up local payroll
  5. Hire local accounting, legal, and HR people

If you're lucky, this process can take months. If you're not so lucky, it can take up to a year. And on average, it costs about $50k-$80k, all-in-all, to get setup. And that's just for Jamaica.

Use an Employer-of-Record (EOR)

An employer-of-record (EOR) is a company that hires and pays an employee on behalf of another company.

An EOR is typically used to overcome the financial and regulatory hurdles that often come with employing remote workers.

Each country has its own payroll, employment, and work permit requirements for non-resident companies doing business in their jurisdiction. Meeting those demands can be a huge obstacle when it comes to hiring remotely.

At Panther, we help companies employ and pay people in over 160 countries, without having to set up a foreign subsidiary. Payroll, benefits, taxes, compliance, and more are all handled by us, at a fraction of the cost.

Outside of saving you months and tens of thousands of dollars, other advantages of using Panther are:

  • Ability to attract talented and motivated employees from all over the world.
  • Full legal compliance: There is no risk of violating local employment laws.
  • Transparency: Employees are still your employees. All the work, processes, operations and day-to-day business belong to you, the company, just like with any other employee. Panther just takes on all of the responsibilities, obligations and admin work related to your team's employment.
  • No risk of misclassification

Because you no longer have to set up your own subsidiary, you’ll save a ton of time and tens of thousands of dollars using Panther.

Paying Remote Employees

Paying employees in Jamaica is not the same as paying workers in your own country. Employees have to be paid using Jamaica’s employment and payroll standards.

This means that you have to know, understand, and keep up with 1) fluctuating currency changes, and 2) local payroll and tax laws in the countries you’re looking to hire in.

Outside of the laws and regulations around payroll, there may be different conditions surrounding leave, overtime, termination, and more. As you can imagine, maintaining this kind of regulatory knowledge can be challenging. But it is crucial and necessary to follow local legislation.

After, you’ll have to determine the best way to pay your international employees. This can be done in a number of ways, including but not limited to:

Pay through a local entity

One of the most challenging (and expensive) parts of paying international employees is setting up the infrastructure to do so.

Before you start to run payroll, you have to register your company as the local employer in the country the worker resides in. As you can see in the “Set up a subsidiary” section, this is a multi-step process that can take up to a year and put you on your way to bankruptcy.

Work with an EOR

Outside of EORs acting as the full admin employer, many also provide remote payroll.

For example, at Panther, in just 1-click, you’re able to pay your entire global team, anywhere in the world. We send you an invoice each month, charge you in US Dollars, and pay your employees the same amount in their local currency.

We factor in currency fluctuations and use the mid-market rate plus any applicable fee passed on by our provider at cost at the time of billing.

Jamaica

 Specific Information

Working Hours

Full-time employment is considered 40 hours weekly. Hours may be spread over 5 days if the worker chooses.

Overtime

Overtime is defined as work exceeding 40 weekly hours, work on a rest day, or work on a holiday.  

Overtime pay is 150% the normal pay for each additional hour worked, or whatever contractual agreement the employee and employer have agreed upon.  

Double time is paid on Sunday and Public Holidays.

Payroll Tax

Employer

Employer

  • National Insurance Scheme (NIS)
  • National Housing Trust (NHT)
  • Education Tax
  • Human Employment & Resources Training (HEART)

Minimum Wage

Jamaica have a minimum wage policy of $7,000 per week and J$9,770 per week for security guards.

Payroll

Pay Cycle

Salaries are paid on either a monthly or semi-monthly basis.

13th Salary

Not required by law. 

Leave

Paid Time Off (PTO)

PTO is calculated by the:

  • Employees are granted 2 weeks of paid leave per year.
  • 3 weeks of paid leave is granted to employees with over 10 years of continuous service.  

Public Holidays

There are 10 public holidays.

Sick Days

The duration of sick leave entitlement provided to workers is dependent on how long they have been employed by their employer:

  • Employees are entitled to 10 days of paid sick leave after 110 days of employment. 

Maternity Leave

Employees receive 56 days of paid maternity leave.

For employees to receive benefits they must have 52 weeks of continuous employment and provide notice to the employer.

Paternity Leave

No Statutory Requirements.

Parental Leave

No Statutory Requirements.

Other Leave

None.

Marriage Leave

None.

Bereavement Leave

None.

Termination

Termination Process

Employers should provide a written statement or notify termination in front of a credible witness.

A notice of termination must also be given.  

Notice Period

The notice period in Jamaica is:

Employers are required to provide notice determined by the length of employment.

  • Up to 5 years of employment entitles workers to 2 weeks’ notice.
  • 5-10 years entitles workers to four weeks’ notice.
  • 10-15 years entitles workers to 6 weeks’ notice.
  • 15-20 years entitles workers to 8 weeks’ notice.
  • 20 + years entitles workers to 12 weeks notice.

Severance Pay

Severance pay is only required for cases of redundancy. Severance for redundancy is 2 weeks’ pay per year for the first 10 years and 3 weeks´ pay per year, from the 10th year onwards.  

Probation Period

There is no requirement for a probationary period, however, collective agreements generally stipulate a 3 to 6-month period.