Mozambique: New labor code comes into force

Employer Action Code: Act

Labor Law No. 13/2023 introduces changes to paid leave, employment contracts and severance, among other things. It took effect February 21, 2024, repealing the prior 2007 labor law.

Key details

Notable aspects of the new labor law include:

• The duration of paid annual leave is 12 calendar days in the first year of employment and 30 days per year thereafter (previously up to 12 calendar days in the first year, up to 24 in the second and 30 days thereafter).
• The duration of maternity leave is increased from 60 to 90 calendar days; however, pay replacement benefits from social security (INSS) are payable for only 60 calendar days, so the last 30 days are unpaid.
• New fathers are now entitled to seven days of unpaid paternity leave within an 18-month period (previously one day within a 24-month period). In the event of the mother’s death or disability, paternity leave is 60 days.
• New companies with up to 100 workers may now use fixed-term employment contracts without constraint in the company’s first eight years (previously 10 years). Otherwise, fixed-term contracts remain limited to a two-year duration, with at most, two renewals.
• The maximum quota for employing foreign workers, as a percentage of the workforce, is increased to 15% for companies with up to 10 employees (previously 10%) and to 10% for companies with 11 to 30 employees (previously 8%). The quota remains unchanged at 8% for companies with 31 to 100 employees and at 5% for companies with over 100 employees.
• Severance payable for termination due to “structural, technological, or market reasons” is changed to 30 days’ salary per year of service for workers whose base salary (including seniority bonus) is between one and seven times the sector minimum wage; 15 days per year of service for workers whose salary is between seven and 18 times the minimum wage; and five days per year for workers whose salary is greater than 18 times the minimum wage (previously 20 days’ salary per year of service in all cases).

Employer implications

Employers should review the various changes to ensure compliance. The new law also includes a definition of teleworking (unlike the prior law) but does not include further details, which will be addressed in separate legislation.

Contact

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Michael Brough

Senior Director, Integrated & Global Solutions

email Email phone +971 50 189 5816

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