Employment Law Basics in Djibouti: A Guide for U.S. and Multinational Companies

Quick Hits

• Djibouti’s employment law outlines specific probationary periods based on contract type, with a maximum of three months for executive-level employees under both indefinite and fixed-term contracts.
• Employers in Djibouti can discharge employees during the probationary period without cause, notice, or compensation, but must adhere to specific notice requirements post-probation, varying from fifteen days to three months based on the employee’s role.
• Djibouti mandates a forty-eight-hour workweek with overtime regulations requiring the labor inspector’s approval for overtime hours exceeding five per week, and employees must be compensated for all time spent on the employer’s premises, unlike in the United States.

Probationary Periods

Djibouti’s employment law stipulates different probationary periods based on the type of employment contract. For employees under indefinite contracts:

• Hourly-paid employees: The probationary period shall not exceed fifteen days.
• Monthly-paid employees: The probationary period shall not exceed one month.
• Executive-level employees: The probationary period shall not exceed three months.

For fixed-term contracts, the probationary period is calculated as one business day per week, with a maximum of one month for hourly employees and three months for executive-level employees.

Foreign workers in Djibouti must be employed under a written fixed-term contract, and the probationary period applicable to fixed-term contracts applies to them.

To be valid, the probationary period must be included in the employment agreement.

Termination During Probationary Period

Employers in Djibouti can terminate an employment relationship during the probationary period without cause, notice, or compensation, provided the probationary period is explicitly stated in the employment contract. For indefinite contracts, the probationary period can be extended once.

Termination Requirements Post-Probation

Once the probationary period is over, specific notice requirements apply for terminating employees under indefinite contracts:

• Hourly employees: Fifteen days’ prior notice.
• Monthly-paid employees: One month’s prior notice.
• Executive-level employees: Three months’ prior notice.

Failure to provide proper notice can result in the employer being liable for damages equivalent to the compensation and benefits the employee would have received during the notice period. However, notice is not required if the employee is dismissed for gross or willful misconduct.

Payment in Lieu of Prior Notice of Termination and Severance

Employers can opt for payment in lieu of prior notice of termination, compensating the employee for what they would have earned during the notice period. Djibouti’s labor code does not mandate statutory severance pay, but employers and employees can negotiate severance agreements.

Working Hours, Overtime, and Rest Breaks

The standard workweek in Djibouti is forty-eight hours, which can be extended under specific circumstances, such as overtime, time recovery, or collective bargaining agreements. Employers must inform the labor inspector if employees are required to work overtime, which should not exceed five hours per week per worker. For overtime beyond five hours, express authorization from the labor inspector is required. The total number of hours worked, including overtime, cannot exceed sixty hours per week or twelve hours per day.

One distinction between Djibouti and standard U.S. work hours is that, in the United States, employers are not required to pay employees who remain on premises after they have clocked out for the day and are no longer working. In Djibouti, on the other hand, as long as employees are at the workplace, whether clocked in or clocked out, they must be compensated.

Overtime Premiums and Rest Breaks

Overtime work must be compensated at a premium rate, typically specified in collective bargaining agreements. As long as the collective bargaining agreement is not violating any mandatory provisions of the labor code, the collective bargaining agreement controls the employment relationship. While Djibouti’s labor code does not mandate rest breaks, employers usually provide them to ensure productivity. Employees are entitled to a mandatory weekly rest period of at least twenty-four hours. With the majority of the Djibouti population being of the Muslim faith, rest is typically taken on Fridays to allow people to attend mosque.

Public Holidays and Leaves

Employees in Djibouti are entitled to paid time off on public holidays, including Eid al-Fitr, the Islamic New Year, New Year’s Day, Labor Day (May 1), Independence Day (June 27), and Christmas. For annual leave, employees with at least one year of service are entitled to two and a half working days of paid leave per month, with a minimum of fourteen consecutive days of leave.

Special Leave Provisions

Djibouti’s employment law provides for several types of leave uncommon in the United States, such as:

• Marriage leave: Three days for the employee’s marriage.
• Family events: One day for a child’s marriage, three days for the death of a close family member, and one day for the death of a sibling or in-law.
• Parental leave: In Djibouti, female employees are entitled to fourteen weeks of paid maternity leave (eight weeks before the birth and six weeks after). Male employees are entitled to three days of paid paternity leave.

Conclusion

Overall, Djibouti’s employment law is relatively straightforward and welcoming for U.S. and multinational companies. The forty-eight-hour workweek and the ability to negotiate terms through collective bargaining agreements provide flexibility. However, employers may want to keep in mind the requirements to notify or seek approval from the labor inspector for overtime work. Understanding these basics will help employers effectively manage their workforce in Djibouti.