While the pandemic was still raging in June 2021, it was estimated that around 50% of the South African workforce was working remotely. However, at least in the early stages, it was expected that when covid ended, working patterns would return to ‘normal.’ As time has passed though, it seems that some of the changes we saw developing in 2020 and 2021 have become more permanent.
For instance, the traditional office in the CBD from which all staff work according to set hours looks set to become a thing of the past. Many companies in South Africa, for instance, are only requiring staff to be on the premises two or three days a week, rather than the conventional 9 to 5, Monday to Friday, with the rest of the week spent working remotely.
The places from which companies operate are also changing, with smaller premises taking the place of the big corporate HQ in some sectors. Forward thinking companies are viewing this geographic diversity as a positive outcome for their operations, as this enables them to hire workers from a greater range of backgrounds and with different training and experiences.
At the same time, it cannot be denied that the economic impact from covid has affected employment opportunities locally. This has resulted in an increased willingness on the part of growing numbers of South Africans to consider working remotely for a foreign company based outside the country.
This means there may be significant opportunities for global businesses to take advantage of what is being called a ‘virtual brain drain’ by hiring remote workers in South Africa. It seems there is a growing skilled workforce who would like to experience the many benefits of working for an international company, but without the inconvenience of having to apply for visas and work permits, and then uproot and move away.
Instead, many are choosing to ‘semigrate’ i.e., relocate within South Africa to places like Cape Town, now ranked one of the world’s most desirable locations for remote working.
Being able to tap into this workforce represents an exciting new opportunity for global companies. International employers who might be considering establishing a remote workforce can reference this South African employee benefits and payroll guide for further information.
Digital nomad visas in South Africa
At the same time, there is also the potential for South African and foreign companies to hire non-South Africans specifically as remote workers, in a bid to attract both tourists and foreign capital back to the country.
In this, the government would appear to be responding proactively to changing work patterns worldwide through the introduction of what is being called a digital nomad visa, designed to encourage remote workers from abroad (potentially working either for local or international companies) to choose South Africa as their base.
Although the details are not yet finalized, it is anticipated that a digital nomad visa will enable remote workers to live in South Africa for at least a year, significantly longer than the 90 days currently allowed, as well as to come to the country with members of their family. There is expected to be a minimum salary requirement for the granting of a digital nomad visa, although the amount has yet to be set.
In the meantime, until the scheme is officially launched, there remain several different temporary work visas available to foreign nationals who want to live and work in South Africa.
The two most common are a Critical Skills Work Visa (for certain skills set out from time to time by the government), and the Corporate Visa, which is granted to a company and allows them to employ a set number of foreign workers within South Africa for three years.
What are the employer costs to consider in South Africa?
On top of salary, employers in South Africa are required to pay an additional 2%, consisting of a 1% Skills Development Levy (SDL) and a further 1% to the Unemployment Insurance Fund (UIF). Employees likewise must pay 1% into the UIF.
This 2% impost on employers is one of the lowest in the world, making South Africa a competitive place from which to operate.
Working hours, paid leave, and work culture in South Africa
Currently in South Africa, the regular working week is capped at a maximum of 45 hours (9 hours a day, 5 days a week). Overtime must be paid if an employee works beyond these hours, which is capped at 10 hours per working week. Overtime must be paid at a rate of 150% on weekdays and 200% for anyone earning below the threshold of 224 080,30 ZAR per year (as of 1 March 2022). Anyone earning over the threshold receives overtime pay at their regular rate.
When it comes to paid leave, workers are entitled to 15 days per year (based on an average 5 day working week, this equates to 1 days paid leave = 17 days worked). There are also 13 public holidays in South Africa annually.
Workers are also entitled to a set number of paid sick days per year at a rate of 100% of their normal pay. The number of days is determined by how many hours a week they work on average over a three-year cycle. For the first six months in a job, employees are entitled to 1 day of paid sick leave for every 26 days worked, after which the number of days available is calculated on an average, pro-rata basis.
