In Timor-Leste, labor law mandates a range of benefits for employees. Employers must comply with these regulations to ensure a fair and legal working environment for their staff.

Paid Leave

• Annual Leave: Employees are entitled to a minimum of 12 working days of paid annual leave per year.
• Public Holidays: Timor-Leste observes several public holidays throughout the year. Employees are entitled to paid leave on these days.
• Sick Leave: Employees are entitled to paid sick leave, although the specific duration may vary depending on the employment contract and individual circumstances.
• Maternity Leave: Female employees are entitled to a minimum of 12 weeks of paid maternity leave, with 10 weeks following childbirth. Since 2021, a portion of maternity benefits may be covered by social security (with minimum contribution requirements).
• Paternity Leave: Male employees are entitled to 5 days of paid paternity leave following the birth of their child.

Other Mandatory Benefits

• Probationary Period: The law allows for a probationary period in employment contracts, but the specific duration is not mandated.
• Notice Period: Both employers and employees are required to provide a notice period before termination of employment. The specific duration depends on the length of service.
• Severance Pay: Employees are entitled to severance pay upon termination, with the amount increasing with the duration of service.
• Social Security: Timor-Leste has a social security scheme that provides benefits such as pensions and healthcare. Employers and employees are required to contribute to the scheme.

In Timor-Leste, many employers offer additional perks to attract and retain talent. These optional benefits can range from health and wellness programs to financial security measures, work-life balance initiatives, personal and professional development opportunities, and family support mechanisms.

Health and Wellness

Some companies provide health insurance plans that cover employees and sometimes their dependents. Forward-thinking employers might offer on-site fitness facilities, gym memberships, or sponsor employee participation in sporting events.

Financial Security

Providing life insurance demonstrates an employer's commitment to employee well-being and can be a valuable benefit for families. Some companies might contribute to employee retirement accounts, helping them plan for the future.

Work-Life Balance

This could include telecommuting options, compressed workweeks, or flexible start and end times. Employers may offer additional vacation days, personal leave days, or sabbatical programs on top of the mandatory paid leave.

Personal and Professional Development

Investing in employee skills through workshops, conferences, or tuition reimbursement programs can boost morale and retention. Financial aid for employees pursuing further education demonstrates a company's commitment to employee growth.

Family Support

This could involve on-site daycare facilities, subsidies for childcare costs, or flexible work arrangements to support working parents. Companies might offer extended maternity or paternity leave beyond the legal minimum.

In Timor-Leste, the health insurance landscape is continually evolving. At present, there is no compulsory requirement for employers to provide private health insurance. However, a public health insurance program exists, offering basic coverage for employees.

The National Health Fund (Fundo Nacional de Saude, FNS)

The FNS is a social security scheme that provides health insurance coverage to all Timorese citizens and legal residents. Employers are obligated to register their employees with the FNS and contribute a percentage of their salary towards the program.

The FNS covers a range of basic medical services, including outpatient consultations, hospitalization, maternity care, and medications, albeit with some limitations. It may not cover the full cost of all medical services, and there may be restrictions on certain procedures or specialists.

Private Health Insurance

While not compulsory, some employers in Timor-Leste may offer private health insurance plans as an additional benefit for their employees. This is more prevalent in larger companies or multinational corporations.

Private health insurance plans can provide more comprehensive coverage than the FNS, including a wider range of medical services, coverage for specialists and advanced procedures, and reduced out-of-pocket costs for patients. However, the availability and cost of private health insurance plans will vary depending on the provider and the level of coverage.

In Timor-Leste, the workforce's retirement security is ensured through a dual approach: a universal social pension and a contributory scheme for civil servants.

Universal Social Pension (SAII)

Established in 2008, the SAII provides a basic monthly stipend to all citizens above 60 years old and people with disabilities above 18. This non-contributory program aims to reduce poverty and improve the well-being of Timor-Leste's elderly and disabled population. The current benefit amount is around US$30 per month.

Contributory Regime for Civil Servants

Timor-Leste introduced a separate pension plan for civil servants in 2016. This contributory scheme requires contributions from both employees and the government. The program offers benefits such as old-age pensions, disability pensions, and survivor benefits.

Private Pension Plans

Private pension plans are not yet commonplace in Timor-Leste's retirement landscape. However, as the economy develops, private options may emerge in the future.