Employer of Record in Papua New Guinea

Guide to Hiring Employees in Papua New Guinea

Your guide to hiring employees in Papua New Guinea, covering the employment landscape, employer of record responsibilities, working customs, and local labor laws.

Hiring Employees In Papua New Guinea
Employer Of Record In Papua New Guinea

Capital City

Port Moresby

Currency

Papua New Guinean Kina

 (

K

)

Timezone

GMT +10

Payroll Frequency

Tax Year

Employer Tax

Languages

English

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How to Hire Employees In Papua New Guinea

Hiring in Papua New Guinea for the first time can be overwhelming, especially when navigating unfamiliar employment laws.  Whether you hire independent contractors, set up a legal entity, or use an EOR service, understanding the local employment landscape is crucial for success.  Playroll’s comprehensive guide can help you get started if you're hiring locally or relocating a team member.

Companies can hire employees in Papua New Guinea in the following three ways:

  • Setting up a local entity. Entity establishment reduces risk exposure and enables direct hiring, but can be costly and time-consuming – making it less practical for companies seeking quick and flexible solutions for hiring in Papua New Guinea.
  • Partnering with an Employer Of Record. An EOR, like Playroll, is a third-party entity that serves as the legal employer of your international workforce which hires, pays, and manages compliance with Papua New Guinea’s labor laws and tax regulations.
  • Hiring independent contractors. Hiring contractors gives companies a flexible, affordable alternative to hiring local employees, though it involves unique misclassification risks.

Good To Know

Papua New Guinea is a favorable destination for businesses seeking global expansion.

The nation's primary investment opportunities center around the growth of infrastructure and the rich abundance of natural resources, encompassing forestry, oil and gas, fisheries, and mining.

Holding the title of the largest economy among the Pacific Islands, Papua New Guinea offers substantial openings for investment and trade.

With a youthful and expanding population, the country presents a considerable talent pool that holds significant potential for businesses.

Employment and Labor Laws in Papua New Guinea

Businesses can only operate smoothly in Papua New Guinea if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Papua New Guinea below, to avoid any compliance issues.

Onboarding Process

We can help you get a new employee started in Papua New Guinea quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations.  

For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment.

Employer of Record in Papua New Guinea

An Employer of Record (EOR) acts as the legal employer for workers in Papua New Guinea, taking on key responsibilities to ensure compliance with local labor laws and regulations. The EOR facilitates the hiring process for businesses that want to employ workers without establishing a legal entity in the country.

The employer of record in Papua New Guinea is responsible for:

  • Employment Compliance: Ensure all employment contracts comply with Papua New Guinea's labor laws and regulations, including proper classification of employees.
  • Payroll Management: Calculate, process, and distribute employee salaries in accordance with Papua New Guinea's payroll laws, including deductions for taxes and social security contributions.
  • Tax Filing and Contributions: Handle the registration, filing, and payment of employer taxes and social security contributions to the relevant authorities.
  • Employment Contracts: Draft and maintain compliant employment agreements, detailing salary, benefits, working hours, and termination terms in line with Papua New Guinea's legal requirements.
  • Benefits Administration: Provide mandatory employee benefits as required by Papua New Guinea's labor laws, such as health insurance, pension contributions, and statutory leave.
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Payroll Management in Papua New Guinea

Payroll Cycle in Papua New Guinea

The payroll cycle in Papua New Guinea is usually Fortnightly, with employees being paid as stipulated in employment contract.

Employment Taxes in Papua New Guinea

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The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in Papua New Guinea tailored to your needs.

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Work Permits & Visas in Papua New Guinea

In Papua New Guinea, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key visa types include the Employment Visa, Work Permit, and Short-term Work Visa. Employers must demonstrate the need for foreign labor, ensure compliance with local labor laws, and submit supporting documentation for sponsorship.

Annual Leave & Company Policies In Papua New Guinea

Mandatory Leave Entitlement in Papua New Guinea

The annual leave entitlement in Papua New Guinea is 14 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

An Employer of Record (EOR) helps businesses manage annual leave, paid time off (PTO), and local holidays across the globe, including in Papua New Guinea. By partnering with an EOR, companies ensure full compliance with local labor laws in Papua New Guinea when it comes to annual leave and time-off management.  EOR providers like Playroll offer platforms that simplify tracking and managing employee time off in Papua New Guinea. By outsourcing this responsibility to Playroll, you can streamline leave management, ensure compliance, and free up time to focus on other business priorities.

Public Holidays in Papua New Guinea

Papua New Guinea observes 12 national public holidays, with dates for certain holidays, such as Easter, varying each year based on the Christian calendar.

Holiday Date
New Year's Day January 1
Remembrance Day of the Late First Prime Minister February 26
Good Friday Friday before Easter Sundaym, date varies each year
Easter Saturday Day after Good Friday, date varies each year
Easter Sunday Easter Sunday, date varies each year
Easter Monday Day after Easter Sunday, date varies each year
King's Birthday June 9
National Remembrance Day July 23
National Repentance Day August 26
Independence Day September 16
Christmas Day December 25
Boxing Day December 26

Employment Termination and Severance Policies in Papua New Guinea

Disclaimer

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.

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ABOUT THE AUTHOR

Jesse Weisz

Jesse is an experienced R&D Analyst at Playroll, a leading Employer of Record (EOR) provider. With a strong background in data analysis and market research, Jesse specializes in identifying emerging trends and driving innovation in global HR solutions. She is an all-rounder, critical thinker and success-seeker (often inextricably linked to being a late-night tea drinker).

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FAQS

FAQs About Hiring In Papua New Guinea

Questions and Answers

What Is an EOR in Papua New Guinea?

An Employer of Record (EOR) in Papua New Guinea is a third-party organization that legally employs workers on behalf of your company. The EOR handles all local employment tasks, including compliance with labor laws, payroll, taxes, benefits, and employment contracts. This allows businesses to easily hire talent in Papua New Guinea without the need to set up a legal entity there, saving time and ensuring compliance with local regulations.

Can I Hire in Papua New Guinea Without an Employer of Record?

Yes, you can hire in Papua New Guinea without an Employer of Record, but this typically requires setting up a legal entity in the country. Establishing a local entity involves navigating registration processes, tax systems, and employment regulations. This can be costly and time-consuming, often taking between 4-6 months to enter a new market. An EOR provides an alternative by allowing you to hire talent quickly and compliantly without the need to establish a legal presence in Papua New Guinea.

How Much Does It Cost To Employ Someone In Papua New Guinea?

The cost of employing someone in Papua New Guinea includes more than just their salary. You also need to consider mandatory contributions such as taxes, social security, insurance, and benefits. These additional costs can vary based on the role, location, and specific employment laws in Papua New Guinea. When using an Employer of Record, there are additional service fees, usually charged as a percentage of the employee's salary or as a monthly or annual fee. This ensures compliance and covers administrative tasks.

What Is the Minimum Wage In Papua New Guinea?

As of January 1, 2024, Papua New Guinea's minimum wage rates are:

  • SSP per month.
  • Applies nationwide across all sectors.
  • Adjustments typically occur annually.

How Does an EOR Help You Run Payroll In Papua New Guinea?

An EOR simplifies payroll management in Papua New Guinea by handling all aspects of salary payments, tax deductions, and compliance with local labor laws for your international employees. The EOR calculates gross pay, deducts necessary taxes and contributions, and ensures employees are paid accurately and on time. They also manage year-end tax reporting and compliance filings, reducing the administrative burden on your team and minimizing the risk of errors or penalties.

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