Most hiring in Morocco takes place through indefinite contracts, within a 44-hour workweek, under a labor code that specifies exact probation lengths, notice periods, and severance formulas rather than leaving them open to negotiation. Wages and total employment costs remain well below those in Western Europe, the workday overlaps closely with the UK and continental Europe, and French serves as the default language of business even though Arabic and Tamazight are the official languages.

This guide covers the essentials for entering and hiring in the Moroccan market.

Overview

Morocco's labor code sets the rules for contracts, working hours, wages, and termination. Two bodies handle most of the compliance work employers deal with directly. The CNSS manages social security contributions, and the DGI oversees income tax withholding.

A reform of the labor code has been under discussion throughout 2026, with particular focus on remote work and digital-first roles. Some of the requirements described below could change as that process progresses, so it is worth monitoring developments periodically.

Morocco's appeal for employers largely comes down to cost and location. Employment costs remain well below those in Western Europe, the time zone overlaps closely with the UK and continental Europe, and French functions as the working language in most business settings even though Arabic and Tamazight are official.

Employment Contracts

Two contract types cover most hiring in Morocco.

Indefinite contracts (CDI) are the default and by far the most common. They carry no end date and continue until either party ends them properly. Moroccan law does not require a CDI to be in writing, but a signed contract is standard practice and worth having, since it establishes job duties, pay, hours, and notice terms from the outset.

Fixed-term contracts (CDD) must be in writing and are reserved for specific situations, such as covering an absent employee or handling a seasonal increase in work. They are generally limited to one year. If a CDD continues beyond that period, or is renewed without a genuine break, it typically converts to an indefinite contract.

💡 Contracts are usually drafted in Arabic or French. Two signed copies are standard, and it is common practice to have them legalized by the local authority.

Probationary periods

A probationary period is optional. If an employer wants one, it must be written into the contract, otherwise the employee is considered permanent from the first day. The permitted length depends on the employee's category.

Either party may end the arrangement during probation without much formality. Once the employee has worked at least one week, however, a short notice period still applies (8 days for workers, 15 days for employees and managers).

Working Hours and Overtime

The standard workweek in Morocco is 44 hours for non-agricultural work. Employers may distribute these hours across five or six days, provided no single day exceeds 10 hours. Employees are entitled to at least 24 consecutive hours of rest each week, usually on Saturday or Sunday.

Any work beyond 44 hours in a week counts as overtime and must be paid at a premium. The rate depends on the time of day and whether the work falls on a normal day or a rest day.

Overtime is generally capped at 100 hours per employee per year. Exceeding that limit requires authorization from the labor inspectorate. Overtime should be paid alongside the wages it was earned with, and employers should maintain detailed time records, since unpaid overtime is among the most common issues found in labor inspections.

💡 Certain sectors, such as hospitality and agriculture, follow different working-time arrangements. It is worth confirming whether sector-specific rules apply before hiring outside a standard office role.

Minimum Wage

Morocco sets its minimum wage through the SMIG for non-agricultural work and the SMAG for agricultural work. Both are revised periodically, typically following negotiations between the government, unions, and the employers' federation.

Both rates increased in 2026 as part of a multi-year wage agreement.

These figures represent floors rather than typical salaries. Most roles, particularly in professional services and technology, pay well above minimum wage. Employers should still display the current rate at the workplace and confirm that every payslip meets it.

Payroll and Taxes

Payroll in Morocco runs monthly, with salary typically paid on or near the last working day of the month. Employers withhold income tax and the employee's share of social security contributions before paying net salary.

Income tax withholding (IR)

Morocco taxes income on a progressive scale, applied to annual net taxable income. Under the 2026 rates, the brackets are as follows.

Net taxable income is what remains after deducting the employee's social security contributions and a standard 20% expense allowance, capped at MAD 30,000 per year. Employees also receive a deduction for each dependent, up to six.

💡 Two temporary tax provisions are worth noting. Employees under 35 on their first indefinite contract may be exempt from income tax for three years, and newly created small companies may receive a capped exemption for new hires for two years. Both provisions run through the end of 2026 under current rules, so it is worth confirming their status with a local advisor before relying on them.

Other payroll notes

• There is no legal requirement for a 13th-month salary, though it is common practice, along with a seniority bonus for long-tenured employees.
• Severance pay is exempt from income tax up to a cap of MAD 1,000,000.
• Employers must issue a payslip with every payment, and social security filings are made monthly.

Social Security Contributions

All employers must register with the CNSS and contribute across several categories, including family allowances, short- and long-term benefits, health insurance, and vocational training. Filings are made monthly.

Family allowances, health insurance, and the training tax apply to full salary with no cap. The short- and long-term benefit portions apply only up to MAD 6,000 per month, so cost calculations become more nuanced above that threshold.

Above MAD 6,000 per month, the effective employer rate falls slightly below 21%, since part of the contribution stops growing while the rest continues to accumulate on the full salary. Workplace accident insurance is arranged separately and varies by sector.

Leave Entitlements

Annual leave

Employees begin earning paid annual leave from their first day, but cannot take it until they have completed six months of service. The standard accrual is 1.5 days per month, equivalent to 18 days per year at minimum. This entitlement grows by 1.5 days every five years, up to a cap of 30 days. Employees under 18 accrue at double the standard rate.

Public holidays

Morocco observes a combination of fixed national holidays and religious holidays tied to the Islamic lunar calendar, so the exact count and dates shift slightly each year. Employers can expect between 11 and 14 paid holidays, including Eid al-Fitr, Eid al-Adha, and Throne Day, among others. It is worth confirming the official list annually, since dates change.

Sick leave

There is no separate employer-paid sick leave built into the law. Once an employee has sufficient social security contributions, certified sick leave is covered through those benefits instead, generally at around two-thirds of wage after a short waiting period. Many employers supplement this through company policy.

Maternity and paternity leave

• Maternity leave: 14 weeks total, split roughly seven weeks before the due date and seven after birth. It is paid at full wage, funded through social security. Employees may also take up to one additional year of unpaid leave to care for the child.
• Paternity leave: three days paid, to be used within one month of the birth.

Other leave

The law does not require paid leave for every life event, but it is common practice, often through collective agreements, to provide short paid leave for occasions such as an employee's own wedding or the death of an immediate family member. It is worth reviewing collective agreements within the relevant sector, since many extend beyond the legal minimum.

Employee Benefits

Mandatory benefits flow mostly through the social security contributions described above, including retirement, family allowances, sickness and maternity coverage, and basic health insurance. Beyond these, employers commonly offer the following, particularly for professional roles.

• Supplementary private health insurance (mutuelle), to cover costs that basic health insurance does not reimburse
• A 13th-month bonus, though not legally required
• Seniority bonuses, which become mandatory once an employee reaches two years of service and increase with tenure
• Meal vouchers or a meal allowance
• Transport allowances or subsidized commuting
• Supplementary retirement contributions through a private pension scheme

None of these are legally required apart from the seniority bonus after two years, but they are typically necessary to remain competitive for skilled hires in Casablanca, Rabat, and other urban centers.

Termination Requirements

Morocco does not permit at-will termination of indefinite contracts. Employers must have a valid reason and follow the appropriate process. Termination generally falls into one of three categories.

• Serious misconduct: acts such as theft, physical assault, or a significant breach of trust. No notice or severance is owed, though employers must still follow a fair hearing process before reaching a decision.
• Personal grounds short of serious misconduct: performance issues or other employee-related reasons. Both notice and severance pay apply.
• Economic or structural redundancy: driven by business needs rather than the employee. This follows a separate, more demanding process and often requires government authorization for larger reductions.

Notice periods

Notice depends on the employee's category and length of service. It applies equally whether the employer or the employee ends the contract, and may be worked or paid in lieu.

Severance pay

Employees dismissed for reasons other than serious misconduct, with at least six months of service, are entitled to statutory severance. It is calculated based on average hourly wage over the preceding year, scaled according to tenure.

These bands are cumulative, so a longer-tenured employee's severance blends the applicable rates across each band rather than applying only the highest rate to the entire period of service.

⚠️ An employee dismissed without valid grounds may also claim damages separately, equal to 1.5 months of salary per year of service, capped at 36 months. This applies in addition to the severance and notice described above, not in place of them.

Upon termination, employers also owe payment for any unused leave and must promptly provide the employee's work certificate and social security documentation.

Hiring Through an Employer of Record (EOR)

Without a registered entity in Morocco, a company cannot legally employ staff there directly. An Employer of Record addresses this by becoming the legal employer, managing the contract, payroll, social security registration, tax withholding, and leave or termination requirements, while the client company continues to direct the employee's day-to-day work.

This approach tends to make the most sense when testing the market, hiring a small number of employees before establishing an entity, or aiming to move quickly without managing local registration and filings directly. As headcount grows, it is worth reconsidering whether a local entity would serve the company better over the long term.

If you would like to discuss what hiring in Morocco could look like for your team, reach out to Knit.

Explore opportunities for your business in other international markets with our global hiring guides.

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Frequently Asked Questions

Do I need a local entity to hire employees in Morocco?

Not necessarily. Employers can hire through an Employer of Record without establishing an entity, or engage contractors for project-based work. A local entity becomes more relevant once the company is building a larger, permanent team.

Is a written employment contract required?

Only for fixed-term contracts. Indefinite contracts are not legally required to be in writing, but a signed contract in Arabic or French is standard practice and reduces the likelihood of disputes.

What is the minimum wage in Morocco?

As of January 2026, the SMIG for non-agricultural work is MAD 17.92 per hour, roughly MAD 3,400 to 3,423 per month. Agricultural work follows the SMAG, which increased to MAD 97.44 per day starting April 2026.

How much does it cost to employ someone beyond their salary?

Employers should budget for approximately 21% of gross salary in social security contributions, slightly lower at higher salaries since part of the contribution is capped. Many employers also provide health insurance, meal or transport allowances, and a 13th-month bonus, though none of these are required apart from the seniority bonus after two years.

Can I dismiss an employee without notice?

Only in cases of serious misconduct, and only after following the required process. Dismissing an employee without proper grounds or process exposes the employer to notice pay, severance, and potentially damages for wrongful dismissal.

Is there a 13th-month salary requirement?

No. It is common practice but not required by law. The seniority bonus after two years of service is the one obligation that is mandatory.

How is severance pay calculated?

Severance is based on average hourly wage over the preceding year, multiplied by a rising number of hours per year of service, from 96 hours for the first five years up to 240 hours per year beyond fifteen. It applies to employees dismissed for reasons other than serious misconduct, after at least six months of service.