Outsource to Madagascar

Outsource Top Talents in Madagascar

Discover the unmatched efficiency and innovation that top Madagascan talents bring to the table. Our bespoke outsourcing solutions connect you with the best in the field, ensuring your projects thrive in the hands of dedicated professionals.


Malagasy Ariary (MGA)


Malagasy / French

Payroll cycle



29.61 million


$15.3 billion

Ease of Doing Business

161st Ranked / below average

Outsourcing to Madagascar

Outsource staff in Madagascar

Madagascar’s journey to becoming a favorite for companies looking to outsource work is truly impressive. It’s not just about offering skilled help at lower costs anymore; the country is now seen as a place where businesses can find innovative solutions and build long-term relationships. As Madagascar continues to invest in faster internet and create a welcoming environment for new businesses, its future in the global IT and customer service sectors looks brighter than ever. For companies eyeing to get quality work done while keeping costs in check, Madagascar is becoming hard to overlook.

Madagascar map - outsourcing in Madagascar - iScale Solutions

Benefits of Outsourcing to Madagascar

French Skills

Many people in Madagascar speak French fluently, great for companies that work in French or need language support.

Skilled Workforce

Madagascar has a lot of smart and creative workers who can deliver top-notch work in different fields.


Outsourcing work to Madagascar can help businesses cut down on expenses without losing out on quality.

Easy to Work With

The local workforce is familiar with Western business ways, making teamwork smooth and effective.

Time Zone Advantage

Madagascar’s time zone matches well with European countries, making it easier to communicate and get things done quickly.

Superior Infrastructure

The country has some of the best facilities and systems in Africa, ensuring that outsourced tasks run smoothly.

Hiring Process in Madagascar

In Madagascar, the hiring process begins with defining job roles and spreading the word through job boards and social media. Screening focuses on experience, education, and language skills, essential in Madagascar’s multilingual workforce. Interviews, possibly in multiple rounds, assess candidates’ technical skills and cultural fit. For specialized roles, practical tests may be included. Successful candidates receive a detailed job offer, aligned with local labor laws, followed by a comprehensive onboarding process that integrates them into the company culture, emphasizing adaptability and teamwork.

Key Aspects of Madagascar Employment Laws

Employment Types and Contracts

Madagascar’s employment laws are designed to regulate the relationship between employers and employees, ensuring fair treatment, safety, and rights protection in the workplace. 

Employment Types

Permanent Employment

Involves indefinite contract duration, offering stability and full employment rights including annual leave, sick leave, and access to social security benefits.

Fixed-Term Contracts

Employment for a specific duration with an end date, common for project-based or seasonal work, offering proportional benefits like leave and social security.

Part-Time Employment

Employees work fewer hours than full-time, often with flexible schedules, entitled to pro-rated leave and benefits based on hours worked.

Casual Employment

Involves working on an as-needed basis without guaranteed hours, where rights and benefits may vary and can be more limited.

Seasonal Employment

Work available during certain times of the year, related to agricultural cycles or tourism, with entitlements for the season’s duration.

Apprenticeships and Internships

Designed as training positions for skill or work experience gain, possibly at a lower wage, focusing on learning with some offering a path to permanent employment.

Freelance / Independent Contractors

Individuals operate their own business and provide services under contract, offering flexibility and autonomy, with distinct social security and tax implications.

Key Contractual Elements for Clarity and Compliance

Parties Involved

Clearly identify the employer and the employee, including legal names and addresses, to establish who is entering into the contract.

Contract Type

Specify whether the contract is for permanent, fixed-term, part-time, or another type of employment, as this determines the nature of the employment relationship and applicable legal protections.

Position and Duties

Define the job title, role, and specific duties the employee is expected to perform. This clarity helps manage expectations and responsibilities.

Probation Period

If applicable, include the length of the probation period, during which both parties can evaluate the suitability of the employment relationship.


Detail the salary or wages, including any bonuses or allowances, payment intervals, and the method of payment. This ensures transparency in compensation.

Termination Conditions

Describe the conditions under which the contract can be terminated, including notice periods, severance pay (if applicable), and grounds for immediate termination.

Dispute Resolution

Outline the process for resolving any disputes that may arise under the contract, including any mediation or arbitration procedures.

Working hours in Madagascar

In Madagascar, the regulation of working hours is designed to ensure a balanced approach between productivity and the well-being of employees. 

Standard Working Hours

The typical workweek in Madagascar is regulated to 40 hours, spread over five days, from Monday to Friday. This standard aims to ensure that employees have a predictable work schedule and adequate rest periods.

Overtime and Compensation

Hours worked beyond the standard 40-hour workweek are considered overtime and are subject to additional compensation. Overtime pay rates are typically higher than regular pay rates, in accordance with Madagascar’s labor laws, to compensate for the extra hours worked.

Rest Periods

Employees are entitled to a rest period, usually during the lunch break, and this break time is not included in the daily working hours. Additionally, workers are entitled to a minimum rest period between workdays, ensuring they have sufficient time to recover and maintain a healthy work-life balance.

Weekends and Public Holidays

Saturday and Sunday are generally observed as rest days, along with public holidays. If employees are required to work on these days, they may be eligible for additional compensation or alternative days off, as stipulated by their employment contract or by national labor regulations.

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Taxes and Social Contributions

Overview of Taxes in the Madagascar

In Madagascar, both employers and employees are subject to various taxes and social contributions, which are essential for financing public services, social security benefits, and infrastructure development.

  • Corporate Tax: Companies operating in Madagascar are subject to corporate tax on their profits. The rate and specific obligations can vary, including deductions and allowances that businesses may be eligible for, to encourage investment and economic activity.
  • Value-Added Tax (VAT): Businesses in Madagascar are required to charge VAT on goods and services, with the standard rate set by the government. Certain products and services may be exempt or subject to reduced rates. VAT collected is remitted to the tax authorities, playing a significant role in the national budget.
  • Income Tax: Employees are subject to a progressive income tax, deducted at source by the employer. The tax rates vary depending on the income bracket, ensuring that taxation is equitable.Employers may also be subject to tax on their profits, with rates and obligations determined by the Malagasy tax code and the nature of their business operations.

Individual Income Tax Thresholds [2023]

In 2023, Madagascar continues to refine its tax policies, aiming to create a balanced economic environment for its citizens and the growing number of expatriates and international businesses within the island nation. A key aspect of these policies is the individual income tax thresholds, which delineate the amount of income that is subject to taxation.

  • Tax-Free Income: Earnings up to MGA 350,000 are exempt from tax, providing relief for low-income earners and ensuring that their basic financial needs are met without the burden of income tax.
  • Moderate Income Brackets:
    • For income just over the threshold, from MGA 350,001 to MGA 400,000, a minimal tax rate of 5% applies, easing the transition into taxable income brackets.
    • As income increases to the range of MGA 400,001 to MGA 500,000, the rate steps up to 10%, reflecting a modest contribution from middle-tier earners.
    • For those earning between MGA 500,001 and MGA 600,000, the rate progresses to 15%, aligning with the principle that higher earners contribute a greater percentage of their income.
  • Upper Income Bracket: Income exceeding MGA 600,000 falls into the highest tax bracket, attracting a 20% tax rate. This bracket captures the essence of progressive taxation, where the most substantial earnings contribute a higher share to national revenues.

Corporate Tax Rates

The standard corporate tax rate in Madagascar is typically around 20% to 28%. This rate applies to the taxable profits of resident companies on their worldwide income and non-resident companies on their Madagascar-sourced income.

Value-Added Tax (VAT) Threshold

In addition to corporate tax, companies are required to charge VAT on goods and services, with the standard rate being around 20%. Certain products and services may be exempt or subject to a reduced VAT rate.

Social Contributions for Employee Welfare

Employers contribute a percentage of the gross salary of each employee to the national social security fund. This contribution covers pensions, health insurance, and other statutory benefits. The rate for employers is typically higher than that for employees, often ranging from 13% to 15% of the gross salary.

  • Pension Scheme: Contributions to the pension scheme are made to ensure that employees have access to retirement benefits. The combined contribution rate (employer and employee) is often around 13%, with employers contributing a larger share.
  • Health Insurance: Contributions to health insurance schemes provide employees and their dependents with access to medical care. The rates for health insurance contributions can vary, and in some cases, employers might offer private health insurance as an additional benefit.
  • Work-related Injury Insurance: This insurance is usually fully funded by the employer and covers employees in case of work-related injuries or diseases. The rate can vary depending on the risk level of the industry.

Leave Entitlements in the Madagascar

Mandatory Leave Entitlements

The Madagascar labor laws stipulate several mandatory leave benefits, ensuring employees have access to rest and recuperation, as well as time off for significant life events and health-related needs.

  • Annual Leave: Employees in Madagascar are entitled to paid annual leave, accruing at a rate of 2.5 days for every month of service, which totals to 30 days after a full year of employment. This entitlement allows employees to rest and rejuvenate, contributing to their overall productivity and job satisfaction.

  • Public Holidays: Madagascar recognizes several public holidays throughout the year, during which employees are entitled to take paid time off. These holidays are established by the government and allow workers to celebrate national and cultural events with their families.

  • Sick Leave: Employees are entitled to sick leave for periods of illness or injury, with the provision typically requiring a medical certificate. The specifics regarding duration and pay vary, but sick leave ensures employees can recover without the stress of losing income.

  • Maternity Leave: Female employees are entitled to 14 weeks of maternity leave, with at least 8 weeks postnatal, to ensure the health and well-being of both the mother and child. Maternity leave is usually paid, with specifics depending on regulations and agreements.

  • Paternity Leave: Madagascar provides paternity leave for new fathers, recognizing the importance of fatherhood in the early stages of a child’s life. The duration and pay conditions for paternity leave can vary, reflecting an evolving understanding of family needs.

  • Bereavement Leave: Employees are entitled to bereavement leave in the event of the death of a close family member. This leave allows employees to grieve and manage related affairs, acknowledging the impact of loss on personal well-being.

  • Special Leave: Special leave provisions cater to various personal circumstances, such as marriage, family emergencies, or civic duties. These leaves recognize the diverse needs of employees beyond the workplace, offering time off for significant life events and obligations.

Optional and Company-Provided Leaves

Beyond the mandated leaves, many companies in the Madagascar offer additional leave benefits as part of their employment package. These can include:

  • Bereavement Leave: Leave granted for the death of an immediate family member, with the duration and conditions varying by company.
  • Emergency or Calamity Leave: Leave provided during natural disasters or emergencies, allowing employees to ensure their safety and attend to affected family members.
  • Study Leave: Some organizations offer leave for employees pursuing further education or professional development, recognizing the value of continuous learning.

Holidays in Madagascar

In Madagascar, public holidays can be categorized into three main types: Public Holidays, Religious Holidays, and Seasonal Observances. Each category has different implications for employee entitlements:

  • Public Holidays: These are days when all employees are legally entitled to a day off with pay. Examples include Independence Day and Labor Day. These holidays commemorate significant national events and are observed by everyone regardless of personal beliefs or religion.

  • Religious Holidays: These include Eid al-Fitr, Eid al-Adha, and Christmas Day, catering to the diverse religious makeup of the country. Employees are generally entitled to take these days off to observe their religious practices, though entitlements may vary based on the employer’s policy and the employee’s religion.

  • Seasonal Observances: Such as the March and September Equinoxes, mark changes in seasons. These are not public holidays, so employees are not typically entitled to time off, but they are widely acknowledged and celebrated in various cultural ways.

In Madagascar, public holidays reflect a blend of cultural, religious, and national significance, offering moments of celebration, reflection, and community engagement throughout the year.

DayName of the holiday
1 Jan, MondayNew Year’s Day
8 Mar, FridayInternational Women’s Day
11 Mar, MondayRamadan Start
20 Mar, WednesdayMarch Equinox
29 Mar, FridayMartyrs’ Day
31 Mar, SundayEaster Sunday
1 Apr, MondayEaster Monday
10 Apr, WednesdayEid al-Fitr (Tentative Date)
1 May, WednesdayLabor Day
9 May, ThursdayAscension Day
19 May, SundayWhit Sunday
20 May, MondayWhit Monday
17 Jun, MondayEid al-Adha (Tentative Date)
20 Jun, ThursdayJune Solstice
26 Jun, WednesdayIndependence Day
15 Aug, ThursdayAssumption of Mary
22 Sep, SundaySeptember Equinox
1 Nov, FridayAll Saints’ Day
21 Dec, SaturdayDecember Solstice
25 Dec, WednesdayChristmas Day
31 Dec, TuesdayNew Year’s Eve

Employment Benefits in Madagascar

Employment benefits are designed to support the well-being of employees, ensuring they have access to essential services and support beyond their basic salary. These benefits are a mix of legally mandated provisions and optional perks that employers may offer to attract and retain talent.

Legally Mandated Benefits

  • Social Security Contributions: Both employers and employees contribute to the national social security system, covering retirement pensions, health insurance, and risk benefits such as work-related accidents.
  • Annual Leave: Employees are entitled to paid annual leave, accruing at a rate that typically allows for 2.5 days per month of service, totaling 30 days per year.
  • Public Holidays: Employees have the right to take off on national public holidays with pay.
  • Maternity and Paternity Leave: Maternity leave is provided for 14 weeks, and while paternity leave is less common, some employers offer it as part of their benefits package.
  • Sick Leave: Employees are entitled to sick leave, with the duration and pay depending on the length of service and specific circumstances.

Optional Benefits

  • Health Insurance: While basic health coverage is part of social security, many employers offer additional private health insurance to cover services not included in the national system.
  • Retirement Plans: Beyond the national pension system, some employers offer private pension plans or savings options to help employees prepare for retirement.
  • Education and Training: Opportunities for professional development, including workshops, courses, and further education, can be offered to enhance skills and career progression.
  • Performance Bonuses: Many companies provide bonuses based on individual or company performance, incentivizing employees to meet or exceed targets.
  • Wellness Programs: Initiatives such as gym memberships, wellness workshops, and recreational activities support employee health and work-life balance.
  • Transportation and Housing Allowances: Some employers offer allowances or subsidies for transportation and housing to help offset living costs, particularly in urban areas.

Types of Bonuses:

  • Performance Bonus: Awarded for surpassing job performance goals, tailored to individual or team successes.
  • Profit-Sharing Bonus: Shares company profits with employees, fostering a sense of ownership and shared success.
  • Sign-On Bonus: Attracts new talent with a financial incentive upon joining the company, especially for hard-to-fill roles.
  • Retention Bonus: Retains key employees during crucial times by offering a bonus for continued service.
  • Holiday Bonus: Provides extra pay around holidays to celebrate the season and thank employees for their hard work.

Termination of Employment in Madagascar

Termination of employment in Madagascar is governed by the labor laws, which outline the conditions under which employment can be terminated, the rights of employees, and the obligations of employers.

  1. Resignation: An employee may voluntarily resign from their position, typically providing notice in accordance with their contract or labor law requirements.

  2. Dismissal for Cause: Employers can terminate an employee for just cause, such as misconduct, poor performance, or breach of contract, following proper disciplinary procedures.

  3. Redundancy: Employment may be terminated due to economic reasons, such as downsizing or closure of the business. Employers are required to follow specific procedures, including notice and severance payments.

  4. Mutual Agreement: Both parties can agree to terminate the employment contract through mutual consent, often involving negotiation of terms beneficial to both.

  5. Retirement: Employment ends when an employee reaches the retirement age as defined by law or their employment contract.

In cases of dismissal for cause or redundancy, employers must provide adequate notice and may be required to pay severance. Employees have the right to contest unfair dismissal through labor courts. It’s essential for both employers and employees to understand their rights and obligations under Madagascar’s labor laws to ensure fair and lawful termination processes.

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Our home-based staff consists of talented professionals who excel in working remotely. They are equipped with the necessary tools and resources to efficiently collaborate with your team from any location. With a focus on productivity and communication, they ensure seamless integration into your projects while delivering high-quality results.

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Our hybrid staff members are adept at blending remote and in-office work to meet your specific requirements. They offer the best of both worlds, combining the flexibility of remote work with the collaboration opportunities of in-person interactions. Whether it’s attending meetings virtually or collaborating on-site, they ensure seamless coordination to achieve your business goals.

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Our office-based staff members are dedicated professionals who thrive in a traditional office environment. They bring a strong sense of teamwork and camaraderie to your projects, fostering a supportive work culture. With access to on-site resources and facilities, they ensure efficient collaboration and seamless project execution.
Common Questions About Outsourcing to Madagascar


How does the employment law in Madagascar support foreign investment?

Madagascar’s employment laws are designed to be favorable to foreign investors, offering flexibility in employment contracts, including fixed-term and indefinite-term agreements. The legal framework ensures compliance and protects the rights of both employers and employees, fostering a conducive environment for investment.

Yes, foreign companies can hire in Madagascar, either directly or through a Professional Employer Organization (PEO). The country offers a talent pool with skills in various sectors, including multilingual capabilities for call centers and digital services.

Initiating an outsourcing partnership with iScale is straightforward. It begins with a consultation to understand your specific needs, followed by a proposal of customized solutions. Once agreed, we’ll proceed with team selection, onboarding, and project kickoff, ensuring transparency and alignment with your objectives throughout the process.