In Tanzania, employment law mandates several benefits for employees, creating a social safety net and fostering a productive work environment.

Leave Benefits

• Annual Leave: Employees are entitled to 28 consecutive days of paid annual leave each year, provided they've been employed for at least six months. There's no legal requirement for employers to offer additional paid vacation days, but some may do so to attract and retain talent.
• Public Holidays: Tanzania observes 15 public holidays throughout the year, and employees are entitled to paid time off on these days.
• Sick Leave: Employees can avail 126 days of paid sick leave within a 36-month cycle. The first 63 days are paid at the full salary, while the remaining period is compensated at 50% of the regular salary. However, a medical certificate from a certified practitioner is mandatory to claim sick leave and pay.
• Maternity Leave: Female employees are entitled to 84 days (three months) of paid maternity leave at full pay. This period can be extended by an additional unpaid 30 days if medically necessary.
• Paternity Leave: Fathers are entitled to two weeks (10 days) of paid paternity leave.

Social Security Contributions

• National Social Security Fund (NSSF): This applies to private sector employees only. Employers contribute 10% of the employee's salary, with the option to recover up to half from the employee's wages, resulting in a combined contribution rate of up to 20%. NSSF contributions provide social security benefits like pensions and unemployment benefits upon retirement or job loss.
• Public Service Social Security (PSSF): This applies to government employees and follows a similar structure to NSSF, with contributions from both employers and employees.

Other Mandatory Benefits

• Notice Period: Both employers and employees are required to provide a notice period before terminating employment. The notice period varies based on the length of service.
• Severance Pay: Upon termination, employees are entitled to severance pay. The minimum amount is 7 days' basic wage for each completed year of service, capped at ten years of service.

In Tanzania, employers often offer a variety of optional benefits to attract and retain talent, promote employee well-being, and boost morale. These perks can range from financial benefits to health and wellness benefits, work-life balance benefits, and other potential perks.

Financial Benefits

• Housing Allowance: This benefit can help offset housing costs in major cities like Dar es Salaam, making relocation and retention more attractive.
• Transportation Allowance: Companies may offer an allowance to cover commuting expenses, especially for employees who live far from the workplace.
• Meal Vouchers or Subsidized Meals: Providing meals or meal vouchers can ease the financial burden on employees and improve convenience.

Health and Wellness Benefits

• Gym Memberships or Wellness Programs: Employers may offer gym memberships or on-site fitness facilities to encourage a healthy lifestyle among employees.

Work-Life Balance Benefits

• Flexible Work Arrangements: Some companies may offer flexible work schedules, remote work options, or compressed workweeks to enhance work-life balance for employees.
• On-Site Childcare: This benefit can be particularly valuable for employees with young children, allowing them to focus on work while their children are cared for in a safe environment.

Other Potential Perks

• Company Phone and Data Plan: Providing employees with a company phone and data plan can improve communication and productivity.
• Relocation Assistance: For employees moving to Tanzania from another country, companies may offer relocation assistance to ease the transition.

In April 2024, Tanzania implemented a legislative change concerning health insurance for employees. This change was brought about by the signing of the Universal Health Insurance Act in 2023, which mandates that all residents in Tanzania, including employees, must have at least a minimum level of health insurance.

Employer Responsibilities

The new legislation places specific responsibilities on employers regarding their employees' health insurance:

• Ensuring Coverage: Employers must ensure all their employees possess health insurance coverage that meets the minimum requirements.
• Financing Options: Employers have two options for fulfilling this requirement:
  • National Health Insurance Fund (NHIF): They can contribute towards their employees' coverage through the NHIF, a government-run program.
  • Private Insurance: Employers can choose to provide private health insurance plans that meet the minimum coverage standards set by the government.

Funding for the Uninsured

The Universal Health Insurance Act also recognizes that some individuals may struggle to afford health insurance. The legislation establishes a fund to specifically address this concern and help cover the costs of health insurance for those who cannot afford it themselves.

In Tanzania, there are several retirement savings options for both public and private sector employees.

Public Sector Pensions

The Public Service Retirement Benefits Act of 1999 governs retirement benefits for government employees in Tanzania. This plan provides a Defined Benefit Pension, where upon retirement, eligible employees receive a monthly pension based on their final salary and years of service.

Eligibility:

• This applies to all Tanzanian civil servants holding pensionable offices.
• The minimum retirement age is 60 years with at least 15 years of contributions. Early retirement is possible at 55, but with a reduced pension amount.

Private Sector Pensions

The National Social Security Fund (NSSF) is the primary vehicle for retirement savings in Tanzania's private sector. It functions as a contributory scheme with mandatory participation for most formal private sector employees.

• The NSSF offers a Defined Contribution Pension, where employees and employers contribute a fixed percentage of the employee's salary to the NSSF account. Upon retirement, employees receive a lump sum benefit based on their total contributions and accrued investment returns.

Eligibility:

• Participation is mandatory for most formal private sector employees.
• The minimum retirement age is 60 years with at least 15 years of contributions for a full pension. Early withdrawals are possible under certain circumstances with penalties.

Additional Options

Private Pension Plans are also available. Some private companies offer their employees voluntary participation in private pension plans alongside NSSF contributions. These plans can provide additional benefits upon retirement.