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Hire in Iraq,
compliantly,
without the complexity.

We become the legal employer for your international workforce in Iraq. You keep full control of your team — we handle payroll, taxes, benefits, and local compliance.

Official NameRepublic of Iraq (Jumhūrīyat al-‘Irāq)
CapitalBaghdad (Basra: Petroleum Capital / Erbil: Kurdistan Regional Hub)
CurrencyIraqi Dinar (IQD / د.ع)
Official LanguageArabic & Kurdish (English widely spoken in oil and tech)
Population~45 million (OPEC's 2nd largest crude oil producer)
Time ZoneArabia Standard Time (AST, UTC+3, no DST)
Minimum WageIQD 350,000 / month
Personal Income TaxProgressive 3% to 15% (General Commission for Taxes - GCT)
Social Security (Pension & Social Security Law)12.0% Employer / 5.0% Employee (17.0% Total)
Annual Leave20 working days paid vacation per year
Standard Workweek40 to 48 hours/week (8 hours/day over 5 or 6 days)

The Republic of Iraq is OPEC's second-largest crude oil producer (~4.5+ million barrels/day) and one of the largest economies in the Middle East (~$250+ billion USD GDP), holding over 145 billion barrels of proven petroleum reserves alongside massive natural gas, agricultural, and reconstruction potential. Centered in Baghdad, the southern energy hub of Basra, and the semi-autonomous Kurdistan Region (Erbil and Sulaymaniyah), Iraq is undergoing major modern infrastructure reconstruction across energy, power grids, logistics, telecommunications, and digital banking. Hiring employees in Iraq requires compliance with the Iraqi Labour Law (*Law No. 37 of 2015*), mandatory contributions to the Pension and Social Security Department (12% employer / 5% employee, with higher 25% rates in oil & gas), personal income tax withholding with the General Commission for Taxes (GCT), and Ministry of Labour and Social Affairs (MOLSA) approvals (or KRG Ministry of Labour in Kurdistan). Incorporating a local LLC takes 4 to 8+ weeks. A Global Employer of Record (EOR) enables international energy, engineering, and telecom companies to hire Iraqi talent legally, quickly, and without establishing a local company. The EOR acts as the legal employer, managing Arabic/English labor contracts, Social Security remittances, GCT tax filings, and compliant IQD/USD payroll.

Economic Overview, OPEC's #2 Producer & Major Infrastructure

Iraq combines immense petroleum reserves and energy export revenues with sweeping nationwide infrastructure reconstruction.

Key Economic Sectors

  • Petroleum & Petrochemicals: Major supergiant oilfields (Rumaila, West Qurna, Majnoon) and downstream energy.
  • Infrastructure & Engineering: Power plants, ports (Grand Faw Port), highways, and housing developments.
  • Telecoms & Digital Banking: Expanding 4G/5G mobile networks and digital payment ecosystems.

Employment Contracts, Labour Law No. 37/2015 & National Quotas

Regulated by Labour Law No. 37 of 2015.

  • National Workforce Quota: At least 50% (and up to 80% in oil & gas) of an enterprise's workforce must be Iraqi citizens.
  • Probation Period: Maximum statutory probation is 3 months.

Working Hours, Overtime & Rest Periods

  • Standard Hours: 40 to 48 hours per week (8 hours/day).
  • Overtime Surcharges: Minimum 150% (1.5× base wage) for daytime overtime; 200% (double time) for night work and on rest days/public holidays.

Annual Leave, Public Holidays & Maternity Protections

  • Annual Paid Vacation: Minimum 20 working days per year (increases to 30 working days for arduous or hazardous work).
  • Public Holidays: 14 official national and religious holidays.
  • Maternity Leave: 14 weeks (98 days) fully paid leave provided by the employer and social security.

Social Security (12% Employer) & 3%–15% Income Tax

Statutory Scheme Employer Share Employee Share Description
Pension & Social Security (Standard) 12.0% 5.0% Retirement, disability, health & work injury (17% total)
Social Security (Oil & Gas Sector) 25.0% 5.0% Special rate for foreign oil & gas contractors (30% total)

Personal Income Tax: Progressive brackets from 3% up to 15% on taxable income, remitted to GCT.

Termination, Notice & Severance Indemnity

  • Notice Periods: Minimum 30 days written notice.
  • Severance Pay: End of service compensation calculated under Labour Law Article 45.

Why Use an Employer of Record (EOR) in Iraq

  • Rapid Energy Sector Deployment: Onboard petroleum engineers and logistics coordinators in Basra, Baghdad, or Erbil in days.
  • MOLSA & GCT Compliance: Automated management of social security remittances and local payroll tax declarations.
  • Work Visa & Security Clearances: EOR assists with Ministry of Interior work visas and residency permits.

Hiring in Iraq? Key Resources

Whether you are evaluating entity setup vs. using an Employer of Record, or looking for the best international payroll solution, our guides give you transparent benchmarks:

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