COUNTRY GUIDE
A short guide to building a dedicated offshore team in South Africa
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Pretoria, Cape Town, Bloemfontein
12 languages including English
62 million
(GMT +2)
120,000+
South African rand (ZAR)
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$2.46 billion
$1.2 billion
Pretoria, Cape Town, Bloemfontein
12 languages including English
62 million
(GMT +2)
120,000+
South African rand (ZAR)
$2.46 billion
$1.2 billion
South Africa is growing quickly as a place for outsourcing technology teams thanks to its growing talent pool and government support for the tech industry. International companies like Amazon Web Services and Google recognized the country’s potential and set up operations there, further expanding the local tech ecosystem.
The country offers several advantages, including skilled talent that is highly educated and fluent in English. South Africa's time zone also works excellently for real-time coordination with Europe and North America, which is a big plus for global teams.
Looking ahead, the IT services market in South Africa is on track for growth. According to Statista, the market is expected to grow by 4.94% between 2024 and 2029, reaching a value of US$7.84bn by the end of the period. This data shows South Africa’s rising importance as a key tech hub in Africa, attracting more investment and talent.
Payroll Cycle
According to South African labor law, the payroll cycle is generally monthly, and employees receive their full salary once a month. Termination payment must be settled within a legal timeframe, typically within seven days of the ending date. Employers are required to pay employees for the notice period worked and any accumulated leave.
In South Africa, employees are typically getting payments at the end of each month. Employment contracts specify the payment schedule, and salary calculations are done monthly. While mid-month advances are not legally required, some companies may offer them as a benefit, often around the 15th of the month, without retained taxes.
Employer Taxes
In South Africa, employers are required to withhold income tax from their employees' salaries based on a tax system. The tax rate starts at 18% for those earning up to R237,100 per year, and increases depending on the income level, reaching up to 45% for higher earners. Employers are also responsible for contributing 1% of the employee's salary to the Unemployment Insurance Fund (UIF).
Overtime Pay
In South Africa, the standard workweek is 45 hours, which can be spread across five or six days. Any work beyond this is considered overtime. Overtime compensation must be outlined in the employment contract, although it is subject to minimum standards defined by law.
The maximum daily limit for overtime is not set at a specific number of hours but employees generally should not work more than 12 hours in a day, including overtime. Overtime work is compensated at 1.5 times the regular hourly rate unless otherwise specified in the employment contract.
For work on public holidays, employees are entitled to either double their regular pay (200%) or a paid day off, as agreed in the contract.
Paid Leave
In South Africa, employees are entitled to at least 21 consecutive days of paid leave each year, which they can take after completing one full year of service, in addition to public holidays. The amount paid for leave is based on the employee’s usual salary, and employers are required to pay the employee in advance before the leave begins, so they receive their full pay while on vacation. While the leave is generally taken all at once, employees have the flexibility to split it into smaller chunks, as long as one of those periods is at least 14 days long.
Sick Leave
In South Africa, employees can take paid sick leave if they provide a medical certificate for absences longer than two consecutive days. For the first six months of employment, sick leave is earned at a rate of one day for every 26 days worked.
Employers must pay the employee’s normal wage for the duration of the sick leave, provided they have available leave, and the illness is officially documented
Public and Provincial Holidays
There are 12 official holidays in South Africa.
Notice Period
In South Africa, the notice period depends on how long the employee has been with the company. For employees with less than six months of service, the notice period is one week. If they’ve been employed for between six months and one year, the notice period extends to two weeks. For employees who have worked for over a year, the notice period is one month. Employers have the option of paying the employee instead of providing the notice period, which means giving the employee their regular salary for the duration of the notice.
If an employee is dismissed for serious misconduct, no notice period is required. Similarly, if both the employer and employee agree to end the contract, they can negotiate the terms of the notification period.
13th Month Bonus
In South Africa, there's no legal obligation for employers to provide a Christmas bonus, but many companies choose to give an annual bonus or 13th cheque around the end of the year, typically in December. This bonus is often equivalent to one month’s salary, but the amount can vary depending on the employer and company's performance. Employees who worked the full year get the full bonus, while those who started later receive a smaller, pro-rated amount.
Starting a business in South Africa can lead to a range of legal and administrative burdens. As a result, many tech companies collaborate with outsourcing firms that manage the complexities of hiring employees in the country.
Outstaffing providers specialize in managing payroll, taxes, HR, and compliance and handling offshore workers' legal and administrative tasks.
With over 20 years of experience, ALLSTARSIT is a trusted partner for businesses seeking tech professionals worldwide. Our services include staff augmentation, dedicated team recruitment, and employer-of-record services tailored to each client's unique needs.
Looking to grow your tech team with skilled talents in South Africa? Contact us to start hiring software developers tailored to your business.
Choose the right expert professionals required for your specific project, saving time and wasted effort.
This service enables software development companies worldwide to meet any technical needs outside their core skill set by adding specialized staff on demand while retaining control of the project's specifications and scope.
Establish R&D / Tech Support / QA & Testing / DevOps / Data Entry Centers in your chosen location.
Forget about investing in facilities, equipment, technology, or human resources. We manage all necessary operations as your specialist. This can help you save money and resources, all while reducing frustration and simplifying internal processes.
Use ALLSTARSIT as your EOR / CM to easily hire employees in new countries without setting up a legal entity.
We act as the employer for your new hire, handling all HR, payroll, tax, and compliance requirements on your behalf, while you maintain control of their workload.
Effortlessly Access Expert Tech Support for Your Projects
Our Tech Support service provides companies worldwide with access to the best technical experts tailored to their specific project needs. Whether you require troubleshooting, maintenance, or specialized assistance, we ensure that you have the right professionals on hand to support your endeavors effectively.
Maximize Your Customer Satisfaction Level with Our Customer Support Service
Access tailored customer care solutions for your business needs. Our expert team is dedicated to addressing inquiries, resolving issues, and delivering personalized assistance. Say goodbye to challenges and hello to exceptional customer care with us.
South Africa is quickly becoming a strong player in the tech industry thanks to a growing pool of well-versed developers in the latest technologies. The cost of hiring tech talent in South Africa is generally lower than in North America or Western Europe, which makes it an attractive option for companies that want to balance quality and affordability. English is widely spoken in South Africa, and many developers are fluent, so collaboration within an international team is smooth.
The demand for skilled developers is growing in South Africa, and the country has a strong tech ecosystem to support it. While the number of developers may not be as high as in some other regions, the country offers a solid pool of talent, especially in fields like software development, web development, and mobile app development. Many developers are also proficient in English, so it is easy to communicate with international teams.
Outsourcing development to South Africa can benefit your business by providing access to quality talent at competitive rates, so you can achieve stronger performance results.
South Africa’s IT professionals use a clear legal framework that guarantees compliance with local labor laws and international standards. The country’s legal system is supportive of foreign business investments, making it an attractive destination for outsourcing. Companies hiring dedicated development teams in South Africa can be confident that all work is completed in accordance with the country’s legal requirements.
If you're considering hiring software developers or building a dedicated team in South Africa, it's necessary to choose the right location, find talented professionals, and navigate the local legal and regulatory landscape. Partnering with a trusted company like ALLSTARSIT can make the process easier so you can build a skilled team that delivers results.
When you want to hire a dedicated development team in South Africa, it’s important to focus on clear communication channels and setting transparent expectations from the start. When you have these in place, you can be more assured that the team is aligned with your business goals, which is key to achieving successful results.
By staying informed on the latest outsourcing trends, we connect you with top developers from South Africa. This means the team we build for you will be qualified with the skills and knowledge that are needed to meet your requirements.
We use practical and effective strategies to help businesses find the right talent in South Africa. Our goal is to provide access to developers who can not only meet your expectations but also offer solutions that cause long-term growth.
At ALLSTARSIT, we specialize in helping you create a dedicated software development team in South Africa that delivers high-quality work and helps move your business forward.
Contact us, and we’ll help you hire the best tech talent in South Africa.
