Table of Contents

Papua New Guinea

Table of Contents

Currency

Papua New Guinean Kina (PGK)

Payroll Frequency

Bi-Weekly

Employer Taxes

42%

About Papua New Guinea

The eastern half of the island of New Guinea in the Pacific is known as Papua New Guinea, with its capital being Port Moresby. The western half is Papua and West Papua, a part of Indonesia. Its location at the Pacific Ring of Fire (collision of several tectonic plates) makes it susceptible to volcanic activity, earthquakes, and tidal waves. Given its geological similarity to other landmasses in the region, such as Australia, Papua New Guinea also has similar island species unique to the region. Three new species of mammals were discovered in the country’s forests, namely a small wallaby, a large-eared mouse, and a shrew-like marsupial. Other rare animals such as the Tenkile tree kangaroo and the Weimang tree kangaroo have also been observed on the territory. There are hundreds of ethnic groups indigenous to Papua New Guinea, making it one of the most heterogeneous populations in the world. The majority are Papuans, whose ancestors arrived in the New Guinea region tens of thousands of years ago. The others are Austronesians, their ancestors having arrived in the region less than four thousand years ago. There are also Chinese, Europeans, Australians, Indonesians, Filipinos, Polynesians, and Micronesians living in the country now.

Employment Relationship

• Permanent Employment

Papua New Guinea allows for employment contracts to be made for a specified or unspecified amount of time. Additionally, if an employee under an employment contract is allowed by an employer to continue their employment after the expiration of the duration specified in the contract, the contract will be considered extended and follow the same terms and conditions for an unspecified amount of time. 

• Fixed-Term or Specific-Purpose Contracts

The Employment Act, 1978 allows for employment contracts to be made for a specified or unspecified amount of time. Additionally, if an employee under an employment contract is allowed by an employer to continue their employment after the expiration of the duration specified in the contract, the contract will be considered extended and follow the same terms and conditions for an unspecified amount of time. An attested contract cannot exceed 2 years for those who are unaccompanied by their dependents; or 3 years for those who are accompanied by any or all of their dependents. If an attested contract's duration is less than the 2 and 3-year limits stated above, upon expiration of the contract, parties can enter into a further attested contract with the same employer for a period, when combined with the original contract that cannot exceed the maximum periods stated above. 

• Temporary Employment Contratcs

The Act also mentions casual employment. When a casual worker is employed by the same employer for more than 6 days in any one month, they are considered an oral contract employee. Either party may end the casual employment contract without notice. If the employer terminates for any reason other than misconduct, the employer must pay for a full day's work on the day the contract is terminated, even if the employee has not worked less than 8 hours.

Probationary Period

Papua New Guinean labor law does not contain provisions regulating probationary periods. 

Working Hours

Employees who are not engaged in shift work are allowed a rest period of at least 24 consecutive hours every week from Monday to Sunday. Shift workers are allowed rest periods which cannot be less than 24 consecutive hours and must total less than 96 hours every 28 days. 

Holidays / PTO

• Statutory Holidays

x

• Paid Annual Leave

For each year of continuous service, employees are entitled to a period of 14 consecutive days of paid leave, including non-working days. If a public holiday falls within an employee's period of paid leave and is observed on a day that would have been a working day, one extra day should be added to account for the public holiday. 

• Sick Leave

According to Papua New Guinea's labor law, an employee is entitled to 6 days of paid sick leave each year when they have the following qualifications:  Worked for at least 6 months  Absent on account of illness or injury Produces a certificate from a medical practitioner

• Maternity Leave

In Papua New Guinea, female employees are entitled to unpaid maternity leave. Those employed for at least 12 months are entitled to 108 days, and those employed for no less than 6 months are entitled to 90 days of maternity leave. 

• Paternity Leave

Papua New Guinea's labor laws do not currently offer paternity leave benefits. 

Termination of Employment

• Notice Period

In Papua New Guinea, a contract of service for a specified time or for specific work terminates when the contract expires or when the work specified in the contract is completed. Where there is no provision in a contract of service for notice of intention to terminate, the length of the notice cannot be less than the following:  1 day's notice if employed for less than 4 weeks  1 week's notice if employed for more than 4 weeks but less than 1 year  2 weeks' notice if employed for more than 1 year but less than 5 years 4 weeks' notice if employed for more than 5 years Notice of termination should be provided either in writing or orally, depending on the type of employment agreement. An employer and an employee may mutually agree to terminate an employment agreement with or without notice. 

• Severance Benefits

Papua New Guinea's labor law does not directly address severance benefits. However, employees who are under attested contracts are entitled to repatriation and moving expenses. Once the contract expires or the contract is terminated, the employer must pay for fees associated with the employee and their dependents moving back to where they lived prior to the start of the contract.