The Maldives, often admired for natural wonders like Banana Reef and the beaches of Addu Atoll, has experienced record tourism in recent years.
Between the more than 500,000 Maldovians, travelers, and international employees (expats), it’s easy to see that companies recruiting remote teams can choose from a dynamic talent pool.
We’ll explore the benefits for businesses employing remote workers living in the Maldives, and some of the legal requirements to be aware of during the hiring process.
Advantages of Hiring in the Maldives
With an economy based primarily on tourism and fishing — and historically low average wages — Maldivians are exploring ways to build upon the gains realized after recently achieving upper-middle-income country status.
This means companies recruiting remote employees based in the Maldives can offer attractive work-life balance benefits and wages that compare favorably to local averages while bolstering their bottom line.
Here are some relevant details about the Maldives:
- Language: Dhivehi
- Currency: Maldivian Rufiyaa (MVR)
- Capital City: Malé
- Population: 521,021
- Cost of Living Rank: 38th
A member of the Global Partnership for Education, the Maldives provides free education through grade 12 and the country’s literacy rate is ten percentage points higher than the world average. Most young Maldivians are bilingual, and over 90% know English.
Economic Diversification and Growth in the Maldives
The Maldives has a robust internet infrastructure, largely thanks to its tourist industry. This connectivity positions the Maldives to diversify its economy as a hub for remote work tech jobs, such as IT services.
Additionally, abundant sunlight throughout the year offers opportunities for renewable energy initiatives.
Hiring Compliantly in the Maldives
Employment Contracts
The Maldives Employment Act outlines three employment categories in its employment laws: definite (up to two years), indefinite (ongoing employment), and specific work agreements tailored to certain industries.
Key contract elements for new hires include job details, compensation, working hours, leave policies, and termination procedures.
While confidentiality clauses are broadly enforceable, non-compete clauses must detail an employee’s circumstances and may not be enforceable.
Employee vs. Contractor: Proper Classification is Key
Global employers can recruit both full-time employees and independent contractors from the Maldives. However, according to Maldives labor laws, employee misclassification can result in financial penalties, including back taxes and fines.
Working Hours & Pay
Minimum wage rates in the Maldives differ depending on the employment sector.
Public sector employees are entitled to a minimum wage of MVR 33.65.
Minimum wages in the private sector are determined by the size of each business, with the Medium Enterprise minimum wage set at MVR 33.65 and the Small Enterprise minimum wage set at MVR 21.63. Micro Enterprises are not subject to a minimum wage.
Employees at unclassified businesses earn a minimum wage of MVR 38.46. The unclassified business minimum wage is MVR 21.63.
Probation Periods
Probationary periods are limited to the first three months of employment.
Employer Taxes
Employers and employees share pension contributions equally, with each contributing 7% of the employee’s salary. Employers must also compute payroll withholdings.
Termination Process & Severance Pay
During probationary periods, either party can terminate employment without notice. After probationary periods, employers can terminate employees with a notice of two weeks to two months, depending on tenure.
Termination may be made without notice when an employee has committed fraud or their work is deemed unacceptable and continued employment is likely detrimental to the employer or the workplace.
Employees with less than one year tenure generally receive one month’s salary as severance pay, and employees with at least one year at the same company are entitled to three months’ salary.
Paid Leave Laws in the Maldives
Vacation and Holiday
Employees in the Maldives are entitled to 30 days of paid leave per year after completing one year of employment. Maldivians also receive paid time off for a variety of holidays, including:
- Independence Day
- Victory Day
- Republic Day
- Eid al-Fitr
- Islamic New Year
Sick Leave
Employees are entitled to up to 30 days of paid sick leave per year.
Parental Leave
Pregnant employees are entitled to 60 days of paid maternity leave, which must begin at least 30 days before the due date. A medical professional may also deem an additional 28 days of leave necessary.
Fathers are entitled to three days of paid paternity leave.
Family Leave
Employees may take up to 10 days of family leave for family obligations, including illness.
Why Digital Nomads Love the Maldives
The Maldives does not offer a digital nomad visa, but all visitors are automatically granted a Tourist Visa upon arrival. Additional visas includ
- Business Visas allow international talent to temporarily stay in the Maldives for business purposes, and is issued upon arrival.
- Meeting Visas provide global talent with the ability to attend Maldives meetings, conferences, or conventions.
- Work Visas pair with previously secured work permits, which can be applied for via the Xpat Online System.
Application requirements vary but generally include proof of yellow fever vaccination and a completed traveler declaration.
Even without a digital nomad visa, remote workers and freelancers who want to work in stunning surroundings while enjoying a low cost of living and a reliable internet connection can likely find a visa to meet their needs.
Employ International Talent in the Maldives with RemoFirst
The potential penalties for misclassifying contractors make it crucial for companies to hire and manage contracted remote talent compliantly. That’s why working with an Employer of Record (EOR) is beneficial.
As an EOR, RemoFirst helps companies employ a remote workforce in more than 180 countries, including the Maldives.
Book a demo today to learn how an EOR can help draw up contracts, protect your IP, handle onboarding, administer payroll, and more.
