Global HR Compliance in Lesotho

Lesotho presents growing opportunities for international employers, particularly in manufacturing and infrastructure-linked sectors. However, like many African markets, the enforcement of labour laws can be inconsistent.

While legal frameworks exist, practical compliance often depends on local practices, sector norms, and relationships with labour authorities. This guide outlines the essential employment rules, as well as practical realities you should be aware of when hiring in Lesotho.

What to Consider Before Hiring in Lesotho

1. Formal Laws vs. Practical Enforcement

Lesotho’s Labour Code is detailed on paper, but real-world enforcement varies. Many small and mid-sized companies operate with informal arrangements or lack robust documentation. Labour disputes are rare but can become serious if they reach the Directorate of Dispute Prevention and Resolution (DDPR). It is strongly advised to document contracts, wages, and terminations even if not strictly enforced.

2. Citizenship and Workforce Quotas

While there is no formal quota on foreign hires, work permits for non-citizens can be difficult to obtain without demonstrating a skill gap in the local workforce. Most companies in Lesotho employ a majority of local staff.

Benefits of Using a Global Employer of Record in Lesotho

Avoid Infrastructure Investment

Setting up a local company in Lesotho can be slow, costly, and often unnecessary for early-stage or project-based work. A Global EOR allows you to start operations without local incorporation.

Local Nuance Without Local Headcount

An EOR with in-country partners understands how Lesotho’s labour system works in practice, including informal expectations, document handling, and navigating labour inspections.

Minimise Administrative Exposure

We manage contracts, pay, leave, and compliance reporting. If laws are updated or enforced suddenly, your business stays protected through our local monitoring.

Withdraw or Scale Quickly

Lesotho’s economy can be unpredictable. An EOR lets you test the market without long-term commitments. Exiting is straightforward and legally compliant.

Bridge Payroll and Currency Complexities

With limited payroll software support and frequent tax rule changes, outsourcing payroll through a compliant EOR helps you avoid calculation errors and regulatory breaches.

Types of Employment Contracts

Under Lesotho’s Labour Code, contracts can be:

Indefinite (open-ended): Most common for ongoing work. Can be terminated with notice.
Fixed-term: Legal for project-based work. Must include a clear end date.
Task-specific: Ends upon completion of a specific task or journey.

Contracts may be written or oral, though written is recommended. For fixed-term and task-based contracts, failure to terminate properly can lead to disputes.

Working Hours

Standard workweek: 45 hours
- 5-day workers: Max 9 hours/day
- 6-day workers: 8 hours/day (5 days) + 5 hours (1 day)
Rest period: At least 1 hour after 5 consecutive hours of work
Overtime: Limited to 11 hours/week, paid at 125% of the base rate.

Probation Period

Maximum: 4 months
May only be extended with approval from the Labour Commissioner
Dismissal during probation: 1 week’s notice or pay in lieu.

Leave Entitlements

Annual Leave

Minimum: 1 day per month worked (12 days/year)
At least 6 days must be taken consecutively in a calendar year
Unused leave: May carry over up to 18 days into next year (if above statutory minimum)

Public Holidays

National holidays are paid days off unless otherwise agreed in writing

Sick Leave

First 6 months: No statutory entitlement (at employer’s discretion)
After 6 months:
- 12 days full pay (per year)
- Additional 24 days half pay (after 1 year of service)
Sick leave must be certified by a medical professional.

Maternity Leave

6 weeks before and 6 weeks after birth (statutory minimum)
Can extend to 8 weeks post-birth if complications occur
Leave is unpaid unless the employer offers benefits.

Termination and Notice Periods

Employer-Initiated Termination

Must be based on:
- Employee’s performance or conduct
- Fraudulent representation of skills
- Business or operational necessity
Minimum notice periods:
- 1 month: after 1+ year of service
- 2 weeks: 6–12 months
- 1 week: under 6 months
Pay in lieu of notice is permitted

Grounds NOT Valid for Dismissal

Trade union membership
Filing complaints
Pregnancy or family responsibilities
Political affiliation or religion

Probation Dismissals

One week’s notice is sufficient unless otherwise stated.

Minimum Wage (2024-2025)

Monthly rates vary by sector (e.g. textiles, construction, agriculture)
As of latest update:
- General minimum wage ranges: LSL 1,178 to LSL 1,285/month
- Subject to annual government review and adjustment.

Income tax: Withheld by employer on a progressive scale
Social contributions: Limited compared to other jurisdictions; local NPF may apply in certain industries
Payroll frequency: Monthly (common), often paid in Lesotho Loti (LSL).

Use the Global Payroll Calculator

Before making your first hire in Lesotho, use Acumen International’s Global Payroll Calculator to:

Estimate total cost of employment in Lesotho
Run gross-to-net or net-to-gross simulations
Compare costs with other Southern African markets
Identify tax thresholds and local contribution requirements.

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Hire in Lesotho with Confidence

Acumen International enables you to hire local or foreign talent in Lesotho without setting up a local company. Through our Global Employer of Record services, we help you:

Quickly onboard full-time employees or expats
Stay compliant with evolving local employment regulations
Handle payroll, tax, leave, and HR admin on your behalf
Minimise risk while gaining flexibility in a developing market
Support international relocations and cross-border talent through global mobility services
Support international relocations and immigration, including visas, work permits, and cross-border compliance.