By NJ Ayuk
nj.ayuk@centurionlg.com
Introduction
The employer/employee relationship in Equatorial Guinea is currently the subject of numerous legal rules. This summary is intended to provide a brief overview of employment law, policies and regulations in Equatorial Guinea. This summary covers many areas of law, and is accordingly introductory and general. Because individual circumstances vary widely and because the laws are always changing, it is always a good idea to speak with a local legal counsel about any unique situation.
While every effort was made to ensure completeness and accuracy, the reader should be aware that the applicable law, statutes and rules may change from time to time. This summary is not intended as a substitute for legal advice.
1. General overview/framework and Governing Law for Employment and Labor
Employment with any company in Equatorial Guinea is voluntarily entered into, and the employee is free to resign at will at any time, with or without cause. Similarly, the employer may terminate the employment in accordance with article 81 of the National Labor Law. The employer does not have the authority to make any oral arrangement with an employee contrary to the foregoing.
The governing law of all employment issues in Equatorial Guinea is EG Labor Law (law num. 2/1990). Where the law is silent, the EG Employment Policy (law num. 6/1999) can be used as a reference. For employment matters, the EG Social Security Law and Inseso Regulatory Grant (Social Security Series number 3, 2001) also govern benefits and other rules of the work place.
Company policies and procedures can also be established; however they must be in compliance with national laws.
2. Summary of minimum statutory entitlements
Holidays
January 1 – New Year
Vary the date – Thursday and Friday
May 1 – Labor Day
June 5 – Birthday of the President
August 3 – Freedom Day
August 15 – Day of the Basic Law
October 12 – Independence Day
December 8 – Immaculate Conception Day
December 25 – Christmas
3. Employment contracts/terms of employment
Two types of employment contracts are allowed in the Equatorial Guinea – limited employment contracts or fixed term contracts, which are contracts for a specified duration with specific commencement and completion dates, and unlimited contracts where the employee continues to work for the employer from a specific date until such time as the employment contract is terminated by either party after giving prior notice.
The government recommends that each employee is given a contract of employment for a definite period. Professionals and support staff required for project with foreign companies can be hired under a contract for specific services, for a period that may exceed the contract term of the foreign company.
Mandatory information needed in an employment contract in Equatorial Guinea
The information required by law to be specified in an employment contract is listed below:
Nature of the contract (limited or unlimited).
Nature of the work.
Duration of the contract (for fixed term contracts).
The location of employment.
Wages/remuneration payable.
Date of the employment contract.
Date of commencement of the employment contract.
The Ministry of labour maintains standard employment contracts, where the employer and the employee need only fill in the blanks. It is however not compulsory for the parties to use or fill these contracts at the Ministry of labour and may instead draft and lodge their own employment contracts provided they do not contain provisions which are contrary to the National Labour Law of Equatorial Guinea.
The employee must sign all copies of the contract on the last page and initial each page as proof of acceptance of all clauses. The company official must sign all contracts for, both support staff and professionals. This includes local and expat staff.
A copy of the contract must be filed with the Ministry of Labor for information and registration within 15 calendar days of its conclusion. The remaining copies are distributed as follows: one copy shall be delivered to the employee within the third working day of submission of the contract to the Ministry. Another is incorporated into the individual’s personal record and a third copy for the company records.
Extension of Employment Contract
When employer desires to contend the contract of a local or expatriate staff in Equatorial Guinea, it must be communicated to the employee verbally and in writing, at least one month prior to the expiration date of the current contract. For purposes of extending the term of the contract, the employee must receive and sign a new contract. A contract can also be modified by a letter from the employer. This letter should contain the new date of expiration of the contract and it should note that it is a modification to the original employment contract.
This notification must also contain references to changes in circumstances, if applicable.
Probation
It is considered that the first 90 days of employment, as well as internal allocations to new charges are for training purposes and therefore constitute a probationary period.
4 Immigration, work permits and visas
Except United States citizens, all foreign workers are required to apply for visas to enter the territory of Equatorial Guinea. Every non citizen has to comply with work permits and residency requirements. These permits are valid for one year and it is renewable. A work permit for an expatriate employee will not be issued by the Ministry of labour unless a formal written labour contract is filed with the Ministry. Work permits sometimes are difficult to get and might take a few weeks to a few months. Residency documents are issued by the Ministry of National Security.
5. Termination and reductions in force
Articles 79 to 85 of the labour law, deals with issues regarding termination and reductions of personnel. In Equatorial Guinea, if an employee decides to leave a Company or an employment contract is terminated, the following applies:
Notice
The Company and the employee are required to give notice at least one week in advance when the employee has worked at least one month, and one month in advance when he/she has worked six months or more. Notice may be waived, without the need for payment of compensation, by mutual agreement between the parties.
The advance notice may be omitted by the payment of a compensation equivalent to the salaries that the employee would have received for a week or a month of work, as applicable.
The advanced notice may also be waived, without the need for payment of compensation, when the employee fails to fulfill their obligations imposed by the labor contract.
Resignation
If an employee chooses to resign from the Company, the employee must write to their supervisor stating the date on which their notice period commenced and their intended leaving departure date. The Company will confirm their final date of employment, to them in writing or through a witness. The employee may be required to stay additional days to complete handover and transition.
Direct Dismissal
Under article 80 of labor law of Equatorial Guinea, there are violations which affect the safety of people and equipment; offend the dignity of other employees, or which obstruct the normal execution of the Company s activities. These will result in direct termination without prior warning.
The following are some of the violations which may result in direct dismissal:
Violence, threats, insults or abuse against a fellow employee, the Company or its representatives and managers during work hours and/or on company premises. Acts occurring outside of the workplace and work hours may also be considered severe violations if it is proven that the perpetrator intentionally avoided the workplace to engage in these acts.
Material losses caused intentionally by the employee or by the employee s negligence or serious fault to any property, work, machinery, vehicles, tools, raw material, products and other objects related to the work.
Misrepresentation by the employee with false certifications or personal references regarding his/her capacity, conduct or professional aptitudes.
Theft, robbery or any other crime against property executed by the employee at the workplace, regardless of the circumstances.
The performance by the employee of immoral acts at the workplace.
Possession, display and/or distribution of pornographic materials or products.
The voluntary release by the employee, in detriment of the company, of industrial or fabrication secrets, or issues that are confidential and that the employee knew as a result of his job.
The open and reiterated denial by the employee to adopt preventive measures and accept the procedures indicated by law, the regulations, and the competent authorities or by the Company, destined to avoid work-related accidents or illnesses, or the destruction of the environment.
Fraud, lack of loyalty or abuse of trust in the responsibilities granted.
Sexual or racial harassment of other members of staff or any person on Company premises or on Company business.
This list is illustrative and not exhaustive.
Reduction-In-Force
Article 83 of labor law of Equatorial Guinea provides a Company’s the ability to terminate employment contracts due to a reduction in work force or the end of its contract. It also states that the Company may end the contracts of employees due to economic, technological, structural or analogous reasons.
However these reasons must be duly proven and communicated to the employees at least three months in advance.
Article 83 of the labour law also calls for updating the labour delegate in advance. The law also states that the individuals affected by the measure will have preference to the re-admission to the company, when the company needs to contract workers again.
Article 75 of the labour code refers specifically to the issue of severance pay.
Section 1 states that the worker will have the right by length of service to a sum of money equivalent to 45 days of salary for every year of service, or the proportional amount per fraction of the month.
Section 2 refers to domestic workers and it states that they are entitled to fifteen days for each year of service. Or the amount proportional to the fraction of the month.
Section 4 states that at the time of the severance pay, the amount will be adjusted taking into consideration the last based salary owned to the worker. The employees are still entitled to their payments when it comes to severance pay, bonus calculations and other company benefits.
Retirement
The normal retirement age under Equatorial Guinea Social Security Law is 60 years old for both men and women.
6. Safety and Health
Article 27 of the National Labor Law and other environmental regulations in Equatorial Guinea administered by the Ministry of Environment and Ministry of health; place certain obligations to employers or companies on issues related to health and safety.
The following are general obligations of the employer
1. To provide practical training in health and safety to the workers when they use or when they change jobs or have to apply a new technique or using new substances that may cause risk to the worker or his companions or others; in any case take care that no worker is exposed to the action of conditions on physical, chemical, biological, environmental or any other opinion without being warned of the damage that could cause health and ways to prevent it.
2. where necessary, provide their workers with protective clothing and equipment appropriate to prevent, as far as is reasonably practicable, risk of accidents or adverse health effects
3. avoid and prevent accidents and occupational diseases
4. According to the type of risk to which the workers may be exposed, the possibility of medical assistance of the employer, at the discretion of the authorities work, have a medical services and pharmacist care for their workers.
5. To communicate without delay to the Institute of Social Security (INSESO) and proceeding with the idea to set a affection, illness or accidents at work and any other pathological conditions that may take place in the work environment and keep a proper record f them.
6. To investigate the causes of accidents and occupational diseases and take appropriate preventive measures.
7. Take notes of the approaches to them by workers about the environment and working conditions to and adapt the necessary measures
8. To favor the participation of workers in the committee of hygiene and security
9. Collaborate with the health authorities for the eradication of endemic diseases
This list is illustrative and not exhaustive.
In the absence of specific regulations, Companies operating within the territory of Equatorial Guinea must have specific policies on the following topics which aim to assist in the provision of a safe and healthy working environment.
This includes:
Company Safety Policy
Environmental Policy
Fire and Evacuation Procedure
Alcohol & Substance Abuse Policy
Medical Policy
Periodic safety meetings
Environment Health & Safety meetings
7. Discrimination and equal treatment
Under the ministry of labor polices, harassment is a verbal or physical conduct that denigrates or shows hostility or aversion toward an individual because of his/her race, color, religion, national origin, age, disability, marital status, genetic predisposition or carrier status, or any other characteristic protected by EG law or that of his/her relatives, friends or associates.
8. Leave (annual, maternal, sick) – Bonus pay
The benefits described below are dictated by EG labor regulations. Company can add their own benefits as they see fit. It should be noted that these benefits must be provided in accordance with the provisions of the labor laws of Equatorial Guinea. These benefits currently include:
Annual leave
In accordance with the provisions of Article 54 of Labor Law, employees are entitled to a month’s vacation for each full year of employment.
Maternity Leave
Paid maternity leave is available six (6) weeks prior to birth and up to six (6) weeks after the birth, or, in the event of medical complications, until a competent health authority deems return to work is appropriate. Additional leave may be approved depending on the circumstances. Approval of Maternity Leave must be sought by submitting the appropriate leave of absence form to the supervisor and then Human Resources Department.
Payment of holidays and overtime
Companies must ensure that local employees observe the official calendar of holidays ordered by Government. Employees who work on holidays will receive a fee equal to 250% of its normal rate for that day. The local employees working on a national holiday will receive one and half times its normal rate, which will add to its normal rate for that day. The local employees who work overtime receive 25% more on their normal rate in relation to hours worked, which will add to its normal rate for that day.
Severance Pay
Upon completion of his contract of employment, the employee is entitled to 45 days of salary per full year worked, or the proportional equivalent of 3.75 days per month worked, provided that termination procedures are followed correctly.
Death Grant
In the case of the death of an employee, for whatever reason, the company will two additional weeks of salary to the salary that the employee has already accumulated, plus all appropriate severance benefits to a beneficiary previously designated by the employee. If the employee does not designate a beneficiary, not disburse any grant or benefit.
Leave in case of death of relatives
In the case of the death of a relative of first degree of consanguinity (father, mother, brother, sister, son, daughter) of the employee, he may be absent from work for up to two weeks with pay.
Change of Residence
The EG Labor Law provides 2 calendar days of paid leave when an employee changes his or her normal residence. For employees with more than one year of service, the company reserves the right to seek justification of the move and sets a limit of no more than one move per 3 years of service.
Bonus
After completing a year of service, local employees are eligible to receive the following bonuses:
National Independence Day:
Employees receive 15 days salary (half month monthly salary) to be paid before 12 October each year;
Christmas Bonus: Employees receive 15 days salary (half month monthly salary) payable before 24 December each year.
Employees who have not completed one year of service at the time of previous payments made will receive an amount prorated on the monthly salary in accordance with the number of months worked.
Can unused vacation be carried over to the next year?
YES,
Can the employee choose to be paid for the vacation days in lieu of actually taking the vacation?
YES
9. Social Insurance and Taxes – Is there a salary ceiling on wages subject to Social security contributions, or are they paid on total wages?
Social insurance and taxes are paid on total wages.
10. Work Conditions
All employers are required to ensure continued implementation of fair employment practices. Article 48 of the Equatorial labour law deals specifically with working conditions for national and expatriate employees. Specifically the law states the following:
1. The duration of work cannot exceed eight hours per day and forty eight hours per week if working during the day. Six hours and thirty six weekly if mixed shift, except the exceptions provided in the present article.
2. It is considered a working shift the time during which the worker is available to the employer. Breaks and lunch time are also considered as working hours, when the worker cannot leave at that time the place of work.
3. Daytime shift is that accomplished between 6am and 6pm, the night between 6pm and 6am and mixed includes daytime hours and a minimum of three night hours, if more than three hours are exceeded it will be consider night.
4. The requirements of section 1 to 3 are not applicable to persons holding managerial positions; people employed in domestic service , or perform function which by their nature are not subject to the fixed working hours;
5. When working in a team, its duration may extend beyond the limits set on paragraph 1, provided that the average working hours calculated for a period of three weeks or shorter, not exceeding eight hours a day and no more than forty-eight a week.
6. Persons under eighteen years can only work day shift not to exceed six hours a day. They must be given the opportunity to have adequate breaks, eat and comply with their educational obligations, or professional development.
This list is illustrative and not exhaustive.
11. Employee representatives, unions, works councils, collective bargaining
At present, there are no labour unions in Equatorial Guinea. There are no strikes or boycotts. Employee representatives are not established in the laws. Workers are free to bring complaints to the Ministry of labour. Depending on the sector, wages are established by the government.
12. Litigation and dispute resolution
Article 82 of the labour law spells out a Procedure in case of dismissal and dispute resolutions. In Equatorial Guinea, Labour laws are enforced the Ministry of labour. Labour disputes are adjudicated by the courts; however, all disputes relating to labour matters must first be referred to the Ministry. If either of the parties involved (employer or employee) is unhappy with the Ministry’s decision and the matter cannot be settled amicably, the dispute may then be referred by the Ministry to court, within two weeks from the date in which the complaint was filed, after which either party may revert to the court directly.
13. Transfer of business (i.e. employment issues in a merger)
Equatorial Guinea law does not indemnify the purchaser of any labour claims, in the case of a merger. The status of employees must stay the same. In cases where there is a merger the government has always intervened to advocate on behalf of employees.
14. Additional issues related to expatriates
Expat vacation
In general expats staffs working a 14/14 or 28/28 rotation receive a total of 26 weeks off work in any 12 months period and therefore the taking of additional time off for annual vacation or public holidays is not operationally practical. Employees in this situation are compensated with an additional payment in lieu.
Expat Repatriation:
The ministry of labour is currently setting new standards for the repatriation of expatriates. At present moment, at the end of the contract the employer is responsible for the repatriation expenses of the employee to the place of recruitment or to any other place which the two parties have agreed upon. If the employee obtains employment with another employer in the Equatorial Guinea, then, the new employer is responsible for repatriation expenses at the end of his service.
About the Author
NJ is the Managing Partner of ECEG Legal with experience providing service to corporate entities in the Gulf of Guinea especially in the oil and gas sector.
NJ obtained a BA from the University of Maryland College Park and a Juris Doctor from WM College of Law in the United States. He further holds an MBA from the New York Institute of Technology. As Managing Partner of ECEG Legal, he focuses on representing clients in energy, oil and gas, banking, public institutions, regulatory compliance, mergers and acquisitions, starting businesses in Equatorial Guinea, business transactions as well as Taxation and arbitration. NJ provides legal and strategic advice on negotiation for the structuring of oil and gas projects in Equatorial Guinea and the Gulf of Guinea.
NJ is a frequent speaker/trainer/advisor on local content and negotiations in the oil and gas industry in Africa.
NJ began his legal career with Houston based Baker Botts, LLP’s Washington office where he gained entrée into the oil and gas sector, international business transaction and litigation.
