Labor Market Regulation

Doing Business measures the regulation of employment, specifically as it affects the hiring and redundancy of workers and the rigidity of working hours. From 2009 to 2011 the World Bank Group worked with a consultative group — including labor lawyers, employer and employee representatives, and experts from the ILO, the OECD, civil society and the private sector — to review the methodology of the labor market regulation indicators and explore future areas of research. The consultative group completed its work in 2011, and its guidance has provided the basis for several changes in methodology. The most recent round of data collection for the project was completed in June 2014, and covered additional areas of labor market regulation, including social protection schemes and benefits as well as labor disputes.

Labor Market Regulation Data

Data points and details, 2015 (Excel, 120KB)

Multi City = Multi-city data for same economy is available.

About Doing Business

The data and analysis appearing on this page was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small to medium-sized domestic business in 189 economies.

Difficulty of hiring covers 4 areas:
  • Whether fixed-term contracts are prohibited for permanent tasks
  • The maximum cumulative duration of fixed-term contracts
  •  The minimum wage for a cashier, age 19, with 1 year of work experience
  •  The ratio of the minimum wage to the average value added per worker
The rigidity of hours covers 7 areas:
  • Whether the workweek can extend to 50 hours or more (including overtime) for 2 months in a year to respond to a seasonal increase in workload
  • The maximum number of days allowed in the workweek
  • The premium for night work (as a percentage of hourly pay)
  • The premium for work on a weekly rest day (as a percentage of hourly pay)
  • Whether there are restrictions on night work
  • Whether there are restrictions on weekly holiday work
  • The average paid annual leave for workers with 1 year of tenure, 5 years of tenure and 10 years of tenure
The difficulty of redundancy index has 9 components:
  • What the length is in months of the maximum probationary period
  •  Whether redundancy is  disallowed as a basis for terminating workers
  • Whether the employer needs to notify a third party (such as a government agency) to terminate 1 redundant worker
  • Whether the employer needs approval from a third party to terminate 1 redundant worker
  • Whether the employer needs to notify a third party to terminate a group of 9 redundant workers
  • Whether the employer needs approval from a third party to terminate a group of 9 redundant workers
  • Whether the law requires the employer to reassign or retrain a worker before making the worker redundant
  • Whether priority rules apply for redundancies
  • Whether priority rules apply for reemployment
The redundancy cost indicator measures the cost of advance notice requirements, severance payments and penalties due when terminating a redundant worker, expressed in weeks of salary.

Doing Business collects data on the existence of unemployment protection schemes as well as data on whether employers are legally required to provide health insurance for employees with permanent contracts. It also collects data on what courts would be competent to hear labor disputes and whether the competent courts are specialized in resolving labor disputes.

Excel
Afghanistan NoNo limit - Art. 14 (2) specifies that labor contracts for a definite period are allowed for periods not less than 1 year. However, no maximum length is specified.No limit0.00.0
Albania YesNo limitNo limit209.860.37
Algeria YesNo limitNo limit229.420.35
Angola Yes6-36 months depending on workers' and or firms' situation. For instance, 36 months is applied to long-term unemployed and in some conditions can be enlarged further - Article 16, Paragraph 1 of the GLL.12151.070.18
Antigua and Barbuda NoNo limitNo limit570.10.36
Argentina Yes60 (Art. 93 - Ley 20.744)601,462.191
Armenia YesNo LimitNo limit113.290.25
Australia NoNo limit (Part 3 of the General Retail Industry Award 2010 in this year's example)No limit2,397.020.29
Austria NoNo limitNo limit1,555.920.26
Azerbaijan No60 uniterrupted months is the maximum before turning into an indefite-term contract (Article 45.5)60133.350.16
Bahamas, The NoThe law is silent - no limitNo limit693.330.25
Bahrain No5 years600.00.0
Bangladesh - Dhaka NoNo limitNo limit0.00.0
Bangladesh - Chittagong NoNo limitNo limit0.00.0
Barbados NoNo limit provied by law - common practice is 6 to 12 monthsNo limit537.50.29
Belarus No60No limit166.280.21
Belgium NoNo limitNo limit2,368.120.41
Belize No2 years, since the worker works in the same city where he lives; hence, he is accompanied by his family (Art. 55(1))No limit384.790.62
Benin No24 - Art. 134863.30.52
Bhutan NoNo limitNo limit66.980.22
Bolivia Yes12 months (Ministerial Resolution No. 283/62 - June 13, 1962)24164.710.47
Bosnia and Herzegovina No24 (Art. 19, Labor Law of FBiH)24383.260.67
Botswana NoNo limitNo limit96.990.09
Brazil - São Paulo Yes24 months24437.80.31
Brazil - Rio de Janeiro Yes24 months24484.240.34
Brunei Darussalam NoNo limitNo limit0.00.0
Bulgaria No36 - Art. 68 of the Labour Code36233.180.27
Burkina Faso No24 months for the national workers - Art. 54, Labor Code, 2008No limit63.420.59
Burundi NoNo limitNo limit2.50.06
Cabo Verde Yes60 months (Art. 360)60131.080.28
Cambodia No24 months240.00.0
Cameroon No24 months - Art 25(1)a)4856.060.29
Canada NoNo limitNo limit1,889.040.3
Central African Republic Yes2 ans - Art.105 , Code du travail2436.630.77
Chad No24 mois selon Art 58 et 59 du Code du Travail, 1996.48123.420.71
Chile No12 months12427.790.23
China - Shanghai NoNo limit - after 10 years of work or 2 renewals of fixed-term contracts, provisions of article 14 of the PRC Labor Contract Law applyNo limit245.390.33
China - Beijing NoNo limit - after 10 years of work or 2 renewals of fixed-term contracts, provisions of article 14 of the PRC Labor Contract Law applyNo limit286.290.38
Colombia No36 - Art. 46, CSTNo limit331.090.35
Comoros No24 - Art. 34, Code du travail, 2012360.00.0
Congo, Dem. Rep. Yes24 Mois - Art. 41, Code du Travail, 2002. Cette durée ne peut excéder 12 mois, si le travailleur est marié et séparé de sa famille ou sil est veuf, séparé de corps ou divorcé et séparé de ses enfants dont il doit assumer la garde.48651.02
Congo, Rep. Yes24 months24208.860.51
Costa Rica Yes12 months in general; 60 months if the work requires special technical preparation12580.510.51
Côte d'Ivoire No24 - Art. 14.4, Code du travail241140.55
Croatia YesLabor Law on July 1st, 2013 (OG 73 / 13) -- No maximum duration on first time fixed term contract No limit534.870.32
Cyprus NoThere are no specific requirements for renewing a fixed-term contract but if a contract for a permanent task is for a period of more than 30 months, it may be considered as an indefinite - term contract. - Art.7 of Employees of Fixed Term (Prohibition of 301,250.120.42
Czech Republic No36 months - Sec. 39 of Act No. 262/2006 Coll., Labor Code, as amended.108544.80.25
Denmark NoNo limitNo limit0.00.0
Djibouti Yes12 - Art. 11, Code du travail, 2006240.00.0
Dominica NoNo limitNo limit348.270.4
Dominican Republic YesNo limitNo limit295.710.4
Ecuador No2424388.020.54
Egypt, Arab Rep. NoNo limit, but employee may terminate after 5 years (Art. 104 Labor Law)No limit0.00.0
El Salvador YesNo limitNo limit243.490.49
Equatorial Guinea Yes24 mois, selon Art. 7(2) Ordonnance Générale du Travail24767.170.38
Eritrea YesThere is not any minimum or maximum duration for fixed-term contract Proclamation 118/2001 Article 11. Duration of Contract of Employment (1) The duration of a contract of employment may be: a. for an indefinite period; or b. for a definite period; or No limit0.00.0
Estonia Yes60 months - Art. 9 (1) New ECA120457.920.21
Ethiopia YesNo limit, with two exceptions: (i) in the case of temporary placement of a worker who has suddenly and permanently vacated from a post and (ii) in the case of temporary placement of a worker to fill a vacant position in the period between the study of theNo limit0.00.0
Fiji NoN/A - No limitNo Limit339.770.6
Finland YesThere is no specific maximum duration for fixed-term employment contracts. (Chap. 1 Sect. 3 - ECA) However, after 60 months a fixed-term contract is subject to the same requirements for termination as an indefinite term contract. (Chap. 6 Sect. 1 - ECA).602,287.550.38
France Yes18 months; can be extended to 24 months for work abroad or in certain other specific circumstances listed at article L.1242-8 of the Labor Code181,922.570.35
Gabon No2448312.550.2
Gambia, The NoNo limitNo limit0.00.0
Georgia No30 months3024.250.06
Germany NoNo maximum duration for fixed-term contract with objective cause; 24 months for fixed-term contract without objective cause (Sect. 14 para. 2 TzBfG)240.00.0
Ghana NoNo limitNo limit64.970.26
Greece Yes36 monthsNo limit814.750.29
Grenada YesNo limitNo limit254.150.27
Guatemala YesNo limit; time limit depends only on the duration of the temporary task, on the expiration date or on the occurrence of any event or circumstance (Art.25)No limit369.020.73
Guinea NoLa durée maximale est de 24 mois (art. 13 alinéa 1 du Code du Travail)240.00.0
Guinea-Bissau Yes12 (Art. 10(3))120.00.0
Guyana NoNo limitNo limit166.410.32
Haiti NoNo limitNo Limit154.481.39
Honduras Yes12 months in general; 60 months for work requiring special technical preparation; however, a longer term can only be found to be in violation of the law on the express request of the worker (Art. 47 and 48)24455.041.51
Hong Kong SAR, China NoNo limitNo limit794.990.18
Hungary No60 months with a derogation if the contract is subject to official approval, in which case the term is that which was officially approved, which may exceed 5 years, § 192 of the Act I of 2012 on the Labour Code60453.740.3
Iceland No24 (AFTE)241,783.940.32
India - Mumbai NoNo limitNo limit125.370.63
India - Delhi NoNo limitNo limit134.820.68
Indonesia - Jakarta Yes24 Months extendable for another 12 months (Art. 59 (4))36248.170.55
Indonesia - Surabaya Yes24 Months extendable for another 12 months (Art. 59 (4))36223.670.49
Iran, Islamic Rep. NoNo LimitNo limit466.630.69
Iraq YesNo limit. Law does not specify a maximum.No limit103.30.1
Ireland NoNo limit (PEFTWA 2003)No limit1,809.660.37
Israel NoNo limitNo limit1,145.810.25
Italy No36 months- After this period a fixed term worker acquires the right to a permanent position in the same firm (Art.1 of the Law No. 368/2001)362,035.740.46
Jamaica NoNo limitNo limit250.120.37
Japan - Tokyo No36No limit1,785.350.29
Japan - Osaka No36No limit1,682.620.27
Jordan No60 (Art. 806 - CC)No limit257.290.39
Kazakhstan NoNo limit - Art. 29, Labor Code, 2007No limit127.870.09
Kenya NoNo limit for term contracts (excluding casual employees)No limit241.391.72
Kiribati NoNo limit, s 6(2) refer only to workers being recruited from one island to another islandNo limit0.00.0
Korea, Rep. No24 months24815.650.28
Kosovo NoNo limitNo limit172.090.14
Kuwait No60 months (Art. 13)No limit211.40.04
Kyrgyz Republic Yes60 - art. 556018.50.12
Lao PDR NoNo limitNo limit74.660.37
Latvia Yes36 (Sec. 45(1))36602.770.32
Lebanon NoNo limit but after 24 months worker is treated as indefinite term for purposes of severance pay (Art. 58).24439.340.38
Lesotho NoNo limit - Section 66 (3) establishes no limitation (in practice, 10 months for permanent tasks and 6 months for temporary tasks are the maximum lengths commonly used)No limit158.70.73
Liberia NoLess than 6 months for an oral contract (Sect. 1501 - LPL) 2 years for a written contract (Sect. 1505(1) - LPL [would be 3 years if work were outside Liberia])No Limit520.82
Libya No2 years (Article 70 of Law No. 12 for 2010)48336.110.24
Lithuania No60 (5 years x 12 months) (Art. 109(1))60382.610.21
Luxembourg Yes24 months - Art. L. 122-4 (1)243,000.180.34
Macedonia, FYR No60 (Art. 46(1))60287.510.51
Madagascar Yes24 mois selon Art. 8, Code du Travail, 2004.2449.830.74
Malawi YesNo limitNo Limit15.720.36
Malaysia NoNo limitNo limit293.010.23
Maldives No24 months (Article 13.g of the new Employment Act 2008)240.00.0
Mali Yes24 Mois.7263.20.56
Malta NoNo limit. However, the law states that a temporary worker shall be considered permanent if (i) the employee has been continuously employed under one or several fixed-term contracts for more than 4 years, and (ii) if the employer cannot provide objective r48952.980.38
Marshall Islands NoNo limitNo limit421.630.77
Mauritania No24 mois - Art. 17 code du travail, 200424105.50.68
Mauritius No24 months24241.90.22
Mexico - Mexico City YesNo limitNo limit174.50.14
Mexico - Monterrey YesNo limitNo limit174.50.14
Micronesia, Fed. Sts. NoNo LimitNo limit357.380.76
Moldova Yes60No limit110.720.39
Mongolia NoNo limitNo limit125.460.28
Montenegro NoArticle 24 of the Labor Code states that an employer cannot conclude one or more fixed term contracts with the same employee if their duration, continuously or intermittently, is more than 24 months.24196.660.22
Morocco YesArticle 17 of the Labour Code provides for a maximum period of 12 months12278.460.74
Mozambique Yes2472139.331.46
Myanmar NoThere is no limit under the lawNo limit0.00.0
Namibia NoNo limitNo limit0.00.0
Nepal YesNo limitNo limit95.030.94
Netherlands No36361,036.470.17
New Zealand NoNo limitNo limit1,980.930.39
Nicaragua NoNo limitNo limit200.120.84
Niger Yes24 mois - Art. 604857.180.79
Nigeria - Lagos NoNo limitNo limit111.170.26
Nigeria - Kano NoNo limitNo limit111.170.26
Norway YesNo limit, but after 4 years the employee is regarded as a permanent employee, and thus enjoy the same job protection (with respect to termination provisions etc) as an indefinite term employee (Sect 14-9 para 5 WEA).483,840.250.29
Oman NoNo limitNo Limit847.720.3
Pakistan - Karachi Yes9 months9104.530.56
Pakistan - Lahore Yes9 months9104.530.56
Palau No24No Limit551.540.39
Panama Yes12 in general; 36 for work requiring special technical preparation (Art. 74)12476.590.34
Papua New Guinea NoFor attested (written contracts) 24 months if the employee is unaccompanied by dependants; 36 months if the employee is accompanied. Sect. 22(2) and (4), Employment Act, 1978No Limit195.960.69
Paraguay Yes12 months for laborers; 60 months for employees (Art. 49)No Limit409.690.76
Peru Yes60, as provided for by Article 53° and following, and article 74° of Labor Productivity and Competitiviness Law, T.U.O. of Legislative Decree N° 728 approved by Supreme Decree N° 003-97-TR.60275.860.34
Philippines NoNo limitNo limit304.930.69
Poland NoNo limit. However, if a fixed-term contract is signed for extensive period not justified by objective reason, it may be considered as a breach of the so-called rules of social cohabitation. In consequence, the court may consider the contract as a contractNo limit535.520.35
Portugal Yes66 months, according to Law no. 76/2013, of November 7th. Under this law, fixed-term contracts expected to terminate before November 8th of 2015 (included those renewd under Law no. 3/2012, of January 10th) can be renewed two more times (in addition to th66754.090.29
Puerto Rico (U.S.) NoNo limitNo Limit1,233.430.51
Qatar No60 months (5 years) - art. 40 Labor LawNo limit0.00.0
Romania Yes3660251.280.23
Russian Federation - Moscow Yes6060390.110.24
Russian Federation - Saint Petersburg Yes6060274.560.17
Rwanda NoAucune limiteNo limit0.00.0
Samoa NoNo limitNo Limit178.650.36
San Marino Yes12 Months (Contratto Collettivo Chapter 4 Art.20)182,836.260.41
São Tomé and Príncipe Yes36 - Art. 4(3) of Law No. 6/92360.00.0
Saudi Arabia NoNo explicit limit for a single termNo limit0.00.0
Senegal Yes24 mois (Article L.44 du Code du Travail), avec exception pour les entreprises agrées au Code des Investissements qui peuvent conclure des contrats à durée déterminée pour une une durée de 5 ans, soit 60 mois (Article 19 B du Code des Investissements)24189.281.14
Serbia Yes12 months - Art. 37, Labor Law, 200512232.460.34
Seychelles YesNo limit when it is linked to the completion of a task, not expressed in units of time where the limit is 6 months. Sect. 19 (2)No limit421.860.28
Sierra Leone Yes12 months - Secs. 8 and 26 of the Employers and Employed ActNo limit4.460.04
Singapore NoNo limitNo limit0.00.0
Slovak Republic No24 months (Art. 48(2))24470.540.23
Slovenia Yes24 (Art. 55(2))241,054.910.38
Solomon Islands NoNo limitNo limit120.220.51
South Africa YesThere is no prescribed maximum duration. The parties can agree on a particular date or a particular event upon the occurrence of which the employment automatically terminates. The length of the contract should relate to the duration of the task which thNo limit336.460.36
South Sudan No24 - Art. 29(2), Labor Act of 1997480.00.0
Spain YesIt depends on the type of fixed-term contract: (i) for a particular task or service, the contract terminates when the service or task is completed with a maximum duration of 36 months (that can be extended up to 12 months if provided in the relevant colle121,140.020.31
Sri Lanka NoNo limitNo limit83.030.21
St. Kitts and Nevis NoNo limit - There is no legislation on fixed-term contracts.No limit517.480.3
St. Lucia No24 months24 months0.00.0
St. Vincent and the Grenadines NoNo limitNo Limit239.960.3
Sudan No24 - Art. 29(2), Labor Act of 19974882.420.49
Suriname NoNo limitNo limit0.00.0
Swaziland NoNo limitNo limit174.920.4
Sweden NoFixed term contracts are allowed for permanent and temporary tasks up to 2 years (24 months)240.00.0
Switzerland No120 months There is no maximum duration. However, a fixed-term contract entered into for more than 10 years can be terminated by each party after 10 years with a notice period of 6 months for the end of a month. In this case, if terminated as soon as it c1200.00.0
Syrian Arab Republic No5 years. (Art. 54, Labor Law of 2010)60260.640.68
Taiwan, China YesGenerally 6 to 12 months, but no limit for a "specified work" contract if the prior approval of the competent authority has been obtained - Art. 6, Enforcement Rules of the Labor Standards Act.12649.310.26
Tajikistan Yes60 months (5 years)- Art. 31, Labor CodeNo limit50.250.37
Tanzania Yes0 - Not allowed at all for "our worker" (however, no limit for professionals and managerials cadres.) - Sec. 14(1), Employment and Labour Relations Act, 2004. Fixed employment could also be for "a specific task"No Limit65.730.65
Thailand YesNo limitNo limit251.340.41
Timor-Leste Yes36 months, Sec.11.4 Labour Law 4/201236104.950.18
Togo Yes48 mois selon Art. 43 al. 2 et art. 48, Code du Travail, 2006.48107.21.35
Tonga NoNo limitNo limit0.00.0
Trinidad and Tobago NoNo limit by law. Generally fixed term contract can be from one month (even less) to as much as five years.No limit337.80.18
Tunisia No48 months including renewals -Art 6-4(2) labor code48280.460.54
Turkey YesNo limit - Art. 11, Labor Law No. 4857, 2003No limit569.330.42
Uganda NoNo limitNo limit2.150.02
Ukraine YesNo limit. (Except for seasonal works where the duration or a single fixed-term contract may not exceed the duration of a season--6 months at the most.)No limit147.690.32
United Arab Emirates No48 months - Article 38 of the Labor LawNo limit0.00.0
United Kingdom NoNo limit, but employees who have worked successive fixed term contracts for a period of four years or more will become permament employees unless the employer can objectively justify the continued use of a fixed term arrangements.No limit1,371.670.27
United States - New York City NoNo limitNo limit1,379.370.21
United States - Los Angeles NoNo limitNo limit1,379.370.21
Uruguay YesThere is no legal regulation. However, legal scholars and judges would probably agree that a contract longer than 12 months will not be acceptable, unless there is strong objective need of such term for the employeer and the term is not intended to merelyNo limit610.920.31
Uzbekistan Yes606044.880.19
Vanuatu No36 - Art. 15No limit326.140.74
Venezuela, RB Yes12 months, according to article 62.4 of the Organic Labor Law24622.250.39
Vietnam No36 - Art. 22.1 of the Labor Code 201272123.020.6
West Bank and Gaza No24 months - (Art. 25)24384.621.58
Yemen, Rep. NoNo limit - Art. 29No limit87.330.45
Zambia NoNo limitNo limit292.991.21
Zimbabwe NoNo limitNo limit255.492.12

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