In 2019, the Ethiopian government approved a new Labor Proclamation to replace the old law that had been in place in Ethiopia for the past 16 years. However, over the years, there have been many changes in investments, labor markets, and the business environment in Ethiopia which warranted a renewed look at existing regulations and led to Labor Law Changes in Ethiopia.

Here are some of the key changes to Ethiopia’s labor laws:

Added Responsibilities for Employers
Employers have to fulfill the obligations listed in the previous law, including giving tasks to employees, paying salaries in a timely manner, and respecting all employees and giving them their rights. Alongside these, the new law makes it mandatory for employees to:

  • Deduct union dues from a worker’s salary and then, if the employee agrees, transfer the money into the trade union’s bank account
  • Educate employees and teach them about the rules of the company
  • Register the company, along with information about the location of the workplace and any important data that needs to be provided to the Ministry of Labor and Social Affairs (MoLSA)

Minimum Wage
There have been many struggles in Ethiopia when it comes to the minimum wage. Many drafts have been presented to the government, but none were approved. However, according to the new Proclamation, the Ethiopian government has established a Wage Board, which consists of government representatives, employees, and trade unions. These groups, along with other stakeholders, are to come together and conduct studies to revise the minimum wage at regular intervals based on how the economy is performing.

Minimum Working Age
According to the Proclamation, the minimum age for working is now fifteen years of age instead of fourteen. Moreover, a task list has been specified, along with conditions under which young employees can work.

Employee Benefits
The new Proclamation says female employees are entitled to fully paid maternity leave of 120 days (30 days pre-natal and 90 days postnatal) upon the recommendation of a medical doctor, thus allowing them sufficient time to take care of their newborn children. The law also, for the first time ever, allows paternity leave of three consecutive days for male workers. However, under the Civil Service Law, civil servants will be given five days of paternity leave.

Annual Leave Entitlement
According to the new Proclamation, workers will receive 16 days of annual leave (working days) in the first year that they work for an employee, instead of 14 working days. The old laws allowed one extra day of leave for each year an employee stayed with the same employer. The new Proclamation only allows an extra day’s leave for every two years.

To learn more about labor laws in Ethiopia, click here