How to Hire and Pay Employees in Malawi: A Step-by-Step Guide for Global Employers

So you’re looking at Malawi. It makes sense—there’s real talent emerging, the business climate is improving, and you get a Southern African foothold. Then you start digging into what it takes to actually hire someone there, and the path forward gets murky.

There are contracts to draft, taxes to calculate, and payroll systems to set up, often with rules that don’t resemble what you’re used to.

That’s where this guide comes in. We’re cutting through the complexity with a practical roadmap to help you hire and pay employees in Malawi the right way, without the guesswork.

Navigating the hiring process in Malawi

Hiring in Malawi is doable when you know the rules. The right process helps you onboard smoothly, stay compliant, and build trust with your team from day one.

Determine the right employment model for your situation

You’ve got three viable options for hiring in Malawi:

• Setting up a legal entity in Malawi: This is where you set up shop in the country. That gives you total control, but takes significant time and resources.
• Partnering with an Employer of Record (EOR): This is the best option for onboarding employees fast or testing out a global market to determine if you want to move ahead and expand there.
• Hiring independent contractors: The important distinction here is that these professionals are not technically employees. And if they’re working like one—no matter what you call them in paper—local authorities may see it differently and penalize accordingly.

Here’s a suggested template for your hiring process

1. Define the role and employment type. This decision impacts your tax and benefits obligations. Be clear on whether this is a long-term role or a project-based job.
2. Post the job. MyJobo and JobSearch Malawi are local go-tos. Don’t overlook traditional outlets like local newspapers.
3. Interview and select. Standard interview practices apply, but you’ll also want to confirm the candidate’s work eligibility and ID documentation.
4. Draft the contract. You need a written contract for any employment beyond 12 weeks. More on what to include below.
5. Collect paperwork. Think National ID, tax registration (TPIN), and bank details.
6. Register the hire. You’ll register with the Malawi Revenue Authority (MRA) and, depending on role type, enroll in pension and social security systems.

Mistakes to avoid (and how to sidestep them)

• No work permit for a foreign hire? That’s a fast track to penalties. Secure a Temporary Employment Permit (TEP) before onboarding.
• No written contract? You’re legally required to have one after 12 weeks of work.
• Classifying employees as contractors? That’s one of the biggest red flags for compliance audits.
• Underestimating leave? Minimum annual leave is 18 working days. Public holidays and sick leave aren’t optional either.

Setting up payroll and paying employees in Malawi

Now comes the part where your new hire actually gets paid. Getting this right builds trust and keeps you out of legal trouble.

What setting up payroll really looks like

Here’s what needs to happen:

1. Register with MRA as an employer.
2. Get tax IDs (TPINs) for all employees.
3. Choose a payroll schedule—monthly pay is standard.
4. Calculate net pay: by starting with gross salary, then subtract PAYE and contributions.
5. Generate payslips and maintain records for transparency and audits.

Need help with all of this? It’s common to bring in a local payroll provider or work with a global employer of record (EOR) like Pebl to handle the details so that you can focus on hiring your dream team and/or international expansion.

How salaries are paid in Malawi

• Bank transfers. Most common in formal roles.
• Cash. Still happens, especially in rural areas, but not great for audit trails.
• Mobile money (like Airtel Money or TNM Mpamba). Useful in areas with limited banking access.

Regardless of the method, salaries are typically paid in Malawian kwacha (MWK). Your payroll system should support currency compliance and document all payments.

Your tax obligations as an employer

Malawi’s Pay-As-You-Earn (PAYE) system has progressive tax rates:

• 0% for income up to MWK 100,000/month
• 25% on income between MWK 100,001–1,000,000
• 30% for anything above that

You’ll also need to account for:

• Pension contributions: 10% of gross pay is the employer’s share under the Pensions Act
• Workers’ compensation insurance: Required by law
• Any industry-specific levies

Filing is monthly, and the MRA publishes rates and deadlines each year.

Drafting employment contracts in Malawi

You’ll need a contract that checks all the boxes and then some. Required clauses include:

• Job title and role duties
• Working hours
• Salary and payment details
• Leave entitlements
• Probation (usually three months)
• Termination and notice periods

It’s also smart to include things like confidentiality clauses, non-solicitation agreements, or bonus eligibility criteria. And be sure your contract is written in English or Chichewa.

Tips and resources for a successful application

The smoother your process, the quicker your new hire gets started. Keep things moving by:

• Following hiring checklists for Malawi-specific requirements
• Subscribing to Ministry of Labour and MRA updates
• Leaning on local legal and HR partners when in doubt

Partnering with an EOR provider

You don’t need a legal entity in Malawi to start building a team there. With an employer of record like Pebl, you can hire legally, fast.

An EOR acts as the official employer, handling payroll, contracts, taxes, and compliance, while you manage day-to-day tasks and team culture. It’s your shortcut to:

• Drafting contracts that hold up under Malawi’s labor laws
• Paying employees on time and in local currency
• Staying on top of taxes, social contributions, and insurance

Pebl’s EOR services make this seamless so you can focus on growing, not Googling tax codes.

Hiring in Malawi? Make it easy from day one

Hiring abroad doesn’t have to mean jumping through legal hoops alone. You now know how to:

• Choose the right employment structure
• Draft contracts that meet legal standards
• Set up compliant payroll and calculate taxes
• Lean on expert partners to fill in the gaps

Do this right, and you’ll onboard faster, stay compliant, and build a better employee experience from the first day.

How Pebl can help

Pebl helps companies like yours hire, pay, and manage global teams in 185+ countries, including Malawi. We handle payroll, contracts, compliance, and taxes, so you don’t have to.

With our EOR services, you get:

• Fast, compliant hiring without setting up an entity
• Local currency payroll with tax accuracy
• A seamless onboarding experience for your new hires

Want to hire in Malawi the right way, without the red tape? Let’s talk.

This information does not, and is not intended to, constitute legal or tax advice and is for general informational purposes only. The intent of this document is solely to provide general and preliminary information for private use. Do not rely on it as an alternative to legal, financial, taxation, or accountancy advice from an appropriately qualified professional. The content in this guide is provided “as is,” and no representations are made that the content is error-free.

© 2026 Pebl, LLC. All rights reserved.