Iraq

Understanding market competitive salaries in Iraq requires considering several factors.

National Benchmarks

The average yearly salary in Iraq sits around 21,767,088 Iraqi Dinars (IQD). This translates to an hourly rate of approximately 10,465 IQD.

Factors Influencing Market Competitive Salaries

Several factors influence what constitutes a competitive salary in the Iraqi job market:

• Industry: Certain industries, like oil & gas or pharmaceuticals, typically offer higher salaries compared to others.

• Experience & Qualifications: Professionals with extensive experience, advanced degrees, or specialized certifications can command higher salaries.

• Location: Cost of living can vary across Iraqi cities. Salaries may be higher in major metropolitan areas like Baghdad compared to rural locations.

• Company Size & Reputation: Multinational corporations or established Iraqi firms might offer more competitive salaries compared to smaller companies.

The minimum wage in Iraq is governed by the Iraqi Labour Code, with Act No. 71 of 1987 serving as the foundational legislation. Amendments to this can be made through subsequent legislation, such as decisions by the Council of Ministers.

Current Minimum Wage

From January 1, 2018, the minimum monthly wage in Iraq has been set at IQD 350,000 (approximately USD $293.29). This is applicable to all workers, irrespective of their skill level.

Enforcement and Penalties

The Iraqi Labour Code also provides details on penalties for employers who do not adhere to minimum wage regulations. These penalties can include fines that range from six times the daily minimum wage to six times the monthly minimum wage per violation.

In situations where an employee receives less than the minimum wage, the employer may be obligated to compensate the worker with an amount that is double the difference between the wage paid and the minimum wage, in addition to any fines that may be imposed.

Iraqi labor law mandates certain benefits for employees, with some variations depending on the industry and location. The Kurdistan Region of Iraq may have different regulations. Here's a breakdown of common bonuses and allowances offered in Iraq:

Mandatory Benefits

• Social Security: Iraqi law mandates contributions to a social security system that covers retirement, disability, death benefits, work injuries, and health insurance. Employers contribute 12%, while employees contribute 5% of the base salary. This rate increases to 25% for employers in the oil and gas sector.

• Paid Leave: Employees are entitled to a minimum of 21 paid annual leave days, with an increase of two days for every five years with the same company. Workers in physically demanding jobs receive a minimum of 30 days of paid leave annually.

• Maternity Leave: New mothers are entitled to at least 14 weeks of fully paid maternity leave.

• Sick Leave: Employees can receive up to 180 days of fully paid sick leave, with a maximum of 30 days per year of service.

Common Allowances

• Non-Cash Allowances: Many companies offer non-cash allowances, such as transportation vouchers, meal coupons, or housing allowances. These benefits are exempt from income tax up to 30% of the basic salary.

• Housing Allowances: In some cases, employers might directly provide housing or offer a housing allowance to help employees with accommodation costs, particularly for those relocating for the job.

• Overtime Pay: Employees who work beyond their regular hours are entitled to overtime pay, usually at a rate of 1.25 times their regular wage for the first hour and 1.5 times for subsequent hours.

Performance-Based Bonuses

• Performance Bonuses: Some companies offer performance-based bonuses tied to achieving specific goals or exceeding expectations.

• Profit-Sharing: Certain organizations might implement profit-sharing schemes where employees receive a bonus based on the company's profitability.

In Iraq, payroll processing adheres to specific regulations and practices. The norm in Iraq is for employees to receive salaries on a monthly basis. This aligns with common practices observed in many countries.

Pay Frequency

Employees in Iraq typically receive their salaries on a monthly basis. This is a common practice observed in many countries.

Statutory Requirements

Iraq operates a Pay As You Earn (PAYE) system. Employers are responsible for deducting income tax from employee salaries and forwarding it to the relevant authorities within a specified timeframe.

In addition, the country requires employers to contribute a portion of employee salaries towards social security, health insurance, and work injuries. These contributions vary depending on the industry but typically fall within the range of 12% to 25% of the employee's salary.

Additional Considerations

Unlike some countries in the region, Iraq does not mandate the provision of 13th or 14th-month salaries. These payments are offered at the employer's discretion.

Furthermore, Iraqi labor law dictates limitations on overtime work and corresponding compensation rates. Employers should be familiar with these regulations to ensure fair treatment of employees.