Tanzania, officially known as the United Republic of Tanzania, is a country situated in East Africa, in the African Great Lakes area. It is bordered by countries such as Kenya, Uganda, Rwanda, Burundi, the Democratic Republic of the Congo, Zambia, Mozambique, and Malawi. It also borders the Indian Ocean.

The economy of Tanzania is fast-growing and diverse, with a reliance on industries such as agriculture, mining, tourism, and construction. With a growing workforce of over 32 million people (2024) and a GDP of 79 billion US dollars (2023), many companies are looking to expand into Tanzania and hire workers in this country. 

Their large, youth-based workforce and competitive labor costs make it one of the most attractive countries in Africa; additionally, it offers routes into neighboring markets in countries such as Kenya and Mozambique. This guide will offer advice to companies doing business in Tanzania, from understanding mandatory employee benefits to the local Tanzanian labor laws that must be adhered to.

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Tanzania Labor Law

The Employment and Labour Relations Act of 2004 is the key labor law dictating employee rights, employer obligations, and general working practices in Tanzania.

These include information on working hours, overtime compensation, leave entitlement, and severance pay.

Other acts that also inform Tanzanian labor laws include the following:

  • The Labour Institutions Act of 2004
  • The Workers’ Compensation Act of 2008
  • The Occupational Health and Safety Act of 2003

It’s highly important to consult legal experts for detailed compliance when employing workers in Tanzania. This is recommended to ensure that working practices comply with the latest Tanzanian local labor laws, helping to avoid legal implications/penalties.

Mandatory Employee Benefits in Tanzania

We’ve detailed the key mandatory employee benefits that companies working in Tanzania must follow in the sections below:

Social Security Contributions

The National Social Security Fund of Tanzania is a government agency in the country that collects social security contributions and ensures that they fund key areas of society, such as retirement, health, and unemployment benefits.

The social security rates in Tanzania as of 2025 are 20%, with employees responsible for paying 5% and employers for paying 15%.

Employers must pay employee contributions by deducting the relevant amount from employee salaries.

Annual Paid Leave

Annual leave must be provided to all employees in Tanzania once they have worked at least 12 months of continuous service with the same employer.

Workers are entitled to 28 days of annual leave per year at full pay. Annual leave is generally taken consecutively, and if unused at the end of a calendar year, it may be converted into cash.

Tanzania also observes a number of public holidays, which are generally considered to be paid days off and separate from a worker’s annual leave entitlement.

Working Hours

The maximum number of hours an employee in Tanzania can work is 45 hours per week or 9 hours per day.

Hours worked over this amount are considered overtime and must be paid accordingly.

Employees working between the hours of 8 pm and 6 am are considered night workers. Night work must be paid at an additional 5% of an employee’s normal wage for each night hour worked.

Workers under the age of 18, pregnant employees within 2 months of giving birth, and mothers within 12 months of having a baby are restricted from performing night work.

Overtime Pay

Any hours carried out above the normal rate of 45 hours per week count as overtime and must be paid at the rate of 1.5 times an employee’s normal salary.

Workers should be paid twice their normal hourly rate if they perform overtime hours on a rest day or a public holiday.

The maximum number of overtime hours an employee is permitted to work is 50 overtime hours in any four-week period.

Public Holiday Leave

There are many public holidays in Tanzania, which are usually paid days off for employees if they fall on a working day and are considered separate from an employee’s annual leave allowance.

The public holidays in Tanzania in 2025 are as follows:

  • New Year’s Day (1 January)
  • Zanzibar Revolution Day (12 January)
  • Eid el Fitri (31 March)
  • Eid el Fitri Holiday (1 April)
  • Karume Day (7 April)
  • Good Friday (18 April)
  • Easter Monday (21 April)
  • Union Day (26 April)
  • Labour Day (1 May)
  • Eid al-Adha (7 June)
  • Saba Saba (7 July)
  • Farmers’ Day (8 August)
  • Maulid – Tentative Date (5 September)
  • Mwalimu Nyerere Day (14 October)
  • Republic Day (9 December)
  • Christmas Day (25 December)
  • Boxing Day (26 December)

Sick Leave

Employees in Tanzania are entitled to sick pay if they are too unwell to work, provided that they can give their employer a medical certificate from an authorized medical professional.

This consists of 126 days of sick pay in any 36-week cycle.

They will receive 100% of their normal pay in the first 63 days of sickness and 50% of their normal pay for the remaining 63 days of sickness.

Maternity Leave

Female employees in Tanzania are entitled to take paid maternity leave if they have a baby.

Maternity leave in this country is 84 days of paid maternity leave or 100 days of leave if the worker gives birth to multiple children. Leave can be up to 4 weeks before the expected due date, and it is illegal for employers to dismiss pregnant employees.

Workers can discuss having additional maternity leave in the event of birth/delivery complications. Sick leave and annual leave may also be used in some circumstances to increase the amount of paid leave a worker can have after having a child.

Paternity Leave

Paternity leave in Tanzania consists of 3 days of paid leave. Male workers are eligible for paternity leave following the birth of their child, and must take paternity leave within the first 7 days of the child being born.

An additional 7 days of paternity leave may be granted in the event of a premature birth.

Pensions

The pension system in Tanzania consists primarily of the old-age pension scheme, with occupational and private pension options beginning to become more prominent.

The National Social Security Fund provides a basic pension to private-sector workers, while the Public Service Social Security Fund holds contributions for public-sector workers. These are funded via monthly contributions from employees and employers.

Occupational pensions and private pensions are growing in Tanzania and offer additional savings options for people looking to fund their retirement. 

The compulsory retirement age in Tanzania is age 60 as of 2025.

Severance Pay

An employee in Tanzania may be eligible for severance pay if they are dismissed without employee misconduct being present.

Severance pay is typically paid as a minimum of 7 days of an employee’s standard wages for each year of continuous service, to a maximum of 10 years.

Employees must have worked continuously for the same employer for 1 year before becoming eligible for severance pay.

Supplementary Employee Benefits in Tanzania

Employers are recommended to offer their employees supplementary benefits in addition to mandatory entitlements. Additional perks for employees can improve the period of service a worker has with an employer, while also increasing the number of people applying for job roles.

A few examples of supplementary benefits employers could offer include:

  • Flexible working
  • Wellness programs
  • Performance bonuses
  • Private pension opportunity
  • Health/dental insurance
  • Advanced training

Optimize Employee Benefits with Remote People

Remote People can help simplify employee benefits in Tanzania through our Employer of Record (EOR) services.

Our EOR solution ensures employees are hired legally and in full compliance with Tanzanian labor laws. From providing mandatory employee benefits to managing payroll, tax obligations, and employment contracts, we handle the administrative responsibilities so you can focus on your core business.

We’ve produced a help guide that can provide you with more information on hiring employees in Tanzania. This includes a 9-step process to hiring, including understanding what your company needs in terms of recruitment, choosing your hiring methods, and onboarding new employees.

Contact Remote People today to see how we can help your business expand into Tanzania compliantly.