Employer of Record in Cabo Verde

An Employer of Record (EOR) in Cabo Verde is a company that legally hires and pays employees on your behalf. This means you can build a team in Cabo Verde without setting up a local legal entity. An EOR handles all the local HR tasks like payroll, taxes, benefits, and compliance with Cabo Verde's labor laws. This allows you to focus on your business while the EOR takes care of the employment paperwork. For EOR services, you can work with a provider like Rivermate.

How an Employer of Record (EOR) Works in Cabo Verde

Using an EOR in Cabo Verde simplifies the hiring process. Here is how it typically works:

1. You Find the Talent You identify and select the candidate you want to hire in Cabo Verde. You will manage their daily tasks and responsibilities.

2. The EOR Hires Your Candidate The EOR, through its local entity in Cabo Verde, legally hires the employee. It drafts a compliant employment contract that meets all local labor laws.

3. Onboarding is Handled The EOR manages the entire onboarding process. It ensures all necessary paperwork is completed correctly and that the new hire is registered with the relevant authorities, such as the Instituto Nacional de Previdência Social (INPS).

4. Payroll and Benefits are Managed The EOR processes monthly payroll, calculates taxes, and makes social security contributions. It ensures your employee is paid correctly and on time in the local currency, the Cape Verdean escudo (CVE).

5. Compliance is Guaranteed The EOR stays current with Cabo Verde's employment regulations. This ensures you remain fully compliant with local labor laws, reducing legal risks.

Why use an Employer of Record in Cabo Verde

Using an EOR is a practical way to expand your business into Cabo Verde. It removes the legal and administrative burdens of international hiring, allowing you to access new talent without the usual complications.

• Hire Without a Local Entity You can hire employees in Cabo Verde without the cost and time of setting up your own local company.
• Ensure Full Compliance An EOR has expert knowledge of Cabo Verde's labor laws, which minimizes the risk of non-compliance and potential fines.
• Save Time and Money You avoid the lengthy process of establishing a legal entity and managing local payroll and HR.
• Access to Expertise EORs provide local HR support and expertise, helping you navigate a new market with confidence.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Cabo Verde includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in Cabo Verde.

Hiring in Cabo Verde offers a unique opportunity to tap into a growing talent pool in a strategic location. The country's workforce is known for being multilingual, with many people speaking Portuguese and Creole. Key industries driving the job market include tourism, hospitality, fisheries, and renewable energy.

Employment contracts & must-have clauses

When you hire employees in Cabo Verde, you need a clear and compliant employment contract. The two main types of contracts are indefinite-term and fixed-term.

• Indefinite-Term Contracts: These are the standard type of employment contract for permanent positions.
• Fixed-Term Contracts: You can use these for temporary work, like specific projects or seasonal needs. Be aware that there are limits on how long a fixed-term contract can last and how many times you can renew it.

Your employment contracts should always include these essential clauses:

Probation periods

You can include a probationary period at the start of employment. This allows both you and the new employee to see if the working relationship is a good fit. During this time, either party can usually end the contract without notice. The maximum length of a probation period is typically 60 days for most employees.

Working hours & overtime

The standard workweek in Cabo Verde is between 40 and 44 hours, with a maximum of 8 hours per day.

• Rest Periods: Employees are entitled to at least one 24-hour rest period each week, usually on a Sunday. They must also have a 30-minute break after six consecutive hours of work.
• Overtime: If an employee works more than the standard hours, you must pay them overtime. The overtime rate is at least 50% higher than the normal hourly wage. There are limits on how much overtime an employee can work, with a maximum of 2 hours per day and an annual cap of 160 hours, which can be extended to 300 hours with the employee's written consent.

Public & regional holidays

Your employees in Cabo Verde are entitled to paid time off for public holidays. Plan your work schedules around these dates.

Here is a list of national public holidays for 2025:

There are also several regional and municipal holidays that may apply to your employees depending on their location.

Hiring contractors in Cabo Verde

Hiring independent contractors can be a flexible option for project-based work. However, you must classify workers correctly to avoid legal problems.

An independent contractor is self-employed and responsible for their own taxes and social security contributions. They typically have control over how, where, and when they do their work.

Misclassifying an employee as an independent contractor can lead to significant penalties. If a court determines that a contractor is actually an employee, you could be responsible for back pay, benefits, taxes, and other fines.

An Employer of Record (EOR) can help you avoid these risks. When you use an EOR, they become the legal employer of your workers in Cabo Verde. The EOR handles all the legal and HR tasks, including:

• Drafting compliant employment contracts
• Processing payroll and taxes
• Managing benefits and social security contributions

This ensures that your workers are classified correctly and that you comply with all local labor laws. Using an EOR allows you to focus on managing your team's day-to-day work without the administrative burden and legal risks of international hiring.

Understanding compensation and payroll in Cabo Verde is straightforward. The country has a defined minimum wage and a clear tax structure. Paying your team is typically done on a monthly basis. While a 13th-month bonus is common, it is not a legal requirement.

Payroll cycles & wage structure

In Cabo Verde, you pay your employees monthly. The standard practice is to pay employees near the end of the month.

The wage structure is based on a national minimum wage. While many employees earn more than the minimum, it provides a baseline for all compensation. Salaries can vary based on the industry, an employee's experience, and their specific role.

Overtime & minimums

The standard work week is 44 hours. Any hours worked beyond this are considered overtime. You must pay employees a premium for overtime hours.

• Regular workday overtime: 150% of the standard hourly rate.
• Rest day or public holiday overtime: 200% of the standard hourly rate.

As of early 2025, the monthly minimum wage in Cabo Verde is CVE 17,000.

Employer taxes and contributions

As an employer in Cabo Verde, you are responsible for contributing to social security for your employees.

Employee taxes and deductions

Employees in Cabo Verde also contribute to social security and pay income tax. You are responsible for withholding these amounts from their paychecks.

Employee income tax is progressive.

In Cabo Verde, your employee benefits package is a mix of required contributions and thoughtful extras. The local labor laws set the foundation with mandatory leave and social security. But, offering more than the minimum helps you attract and keep the best talent. Think of it as your opportunity to show you value your team.

Statutory leave

Cabo Verdean law outlines several types of mandatory leave for employees.

• Annual Leave: Employees get 22 paid vacation days each year after their first year of service. During the first year, they earn two days of leave for each month they work.
• Sick Leave: You must provide up to 30 days of paid sick leave annually. An employee needs to give you a medical certificate to qualify.
• Maternity Leave: Mothers are entitled to 60 consecutive days of paid maternity leave.
• Paternity Leave: Fathers receive 10 days of paid leave after the birth of a child.
• Bereavement Leave: Employees can take up to five paid days off if an immediate family member passes away.

Public holidays & regional holidays

Your team in Cabo Verde is entitled to paid time off for national holidays. Some regions also have their own local holidays. Here are the public holidays for 2025.

Typical supplemental benefits

To build a competitive benefits package, many companies offer more than the legally required minimums. Here’s a look at both statutory and non-statutory benefits.

How an EOR can help with setting up benefits

Setting up and managing employee benefits in a new country can be complex. An Employer of Record (EOR) simplifies this process for you.

An EOR acts as the legal employer for your team in Cabo Verde. This means they handle all the administrative tasks tied to employment.

Here’s what an EOR can do:

• Ensure Compliance: An EOR understands local labor laws and makes sure your benefits packages meet all legal requirements.
• Manage Payroll: They take care of salary payments, tax withholding, and social security contributions.
• Administer Benefits: An EOR manages everything from paid leave to health insurance. Some EORs can even offer competitive benefits like pan-African health insurance and life insurance.
• Save You Time: By handling the HR and administrative work, an EOR frees you up to focus on your core business.

Using an EOR allows you to hire in Cabo Verde without needing to set up a local legal entity. It’s a straightforward way to build a talented team while knowing all the local rules are being followed.

When an employment relationship in Cabo Verde ends, you need to follow a clear process. This process, known as termination and offboarding, ensures you handle everything legally and smoothly. It involves everything from giving notice to calculating final pay. Following the correct steps protects both you and your employee, providing a fair and lawful end to the employment contract.

Notice periods

When you decide to terminate an employment contract in Cabo Verde, you must provide the employee with a minimum notice period. The length of the notice often depends on how long the employee has worked for your company. You should always give this notice in writing. While there are statutory minimums, it's a good idea to check if an individual employment contract or a collective bargaining agreement requires a longer notice period. If you don't provide the required notice, you may have to pay the employee compensation instead.

Severance pay

Employees in Cabo Verde may be eligible for severance pay. This is usually the case when you terminate a contract without just cause, or for economic, technological, or structural reasons. If an employee is terminated for serious misconduct, they are not entitled to severance pay.

The standard severance payment is one month's salary for each year of service. This amount can be increased through a collective agreement. Along with any severance pay, you must also pay the employee any outstanding salary and other benefits like pro-rata holiday pay.

How Rivermate handles compliant exits

Navigating the offboarding process in a different country can be complex. At Rivermate, we simplify this for you. We ensure that every termination process complies with Cabo Verde's labor laws.

Here’s how we help:

• Documentation: We prepare all the necessary paperwork for the termination, ensuring everything is clear and legally sound.
• Final Pay Calculation: We accurately calculate the final payment, including any outstanding salary, benefits, and severance pay due to the employee.
• Compliance Checks: Our team stays up-to-date on local labor laws, so you can be confident that every step of the offboarding process is compliant.
• Smooth Transition: We manage the process to ensure a respectful and professional exit for the employee, protecting your company's reputation.

Navigating visas and work permits in Cabo Verde requires a clear understanding of the local rules. For anyone looking to work in the country, you will need both a visa to enter and a work permit to be legally employed. The process is mainly driven by your employer, who must be a legally registered entity in Cabo Verde. This means that before you can even start the application, you need a formal job offer from a company operating in the country.

Employment visas & sponsorship realities

When it comes to working in Cabo Verde, your employer plays a key role in getting your paperwork in order. They are the ones who will sponsor your work permit application. An Employer of Record (EOR) can be a great help here, as they are set up to handle all the legal and administrative tasks of employment, including visa sponsorship. This is especially useful if your company doesn't have its own legal entity in Cabo Verde.

Here’s what you should know about the practical side of things:

• Employer-led process: The application for a work permit, known as an Autorização de Trabalho, is started and supported by your employer.
• Local labor market: Your employer may need to show that the job could not be filled by a qualified local candidate.
• Required documents: You will need to provide a range of documents, including your passport, a signed employment contract, and proof of your qualifications.
• EOR sponsorship: An EOR acts as your legal employer in Cabo Verde and takes on the responsibility of sponsoring your work visa. They manage the application process and make sure everything follows local laws.

The work permit process in Cabo Verde typically takes around 4 to 6 weeks, but this can change depending on your specific situation.

Business travel compliance

If you are traveling to Cabo Verde for short-term business, you will need a business visa. This visa is for activities like attending meetings, conferences, or negotiations. It is important to remember that a business visa does not allow you to work in the country.

For business travel, keep these points in mind:

• Purpose of visit: A business visa is strictly for business-related activities, not for employment.
• Duration: These visas are usually for short stays, typically up to 90 days. For anything longer, you will need a different kind of permit.
• Invitation letter: You will likely need an invitation letter from the company you are visiting in Cabo Verde.
• Pre-registration: Many travelers, even those who do not need a visa for short stays, are required to pre-register online before their trip.