How do you end employment in Malawi?
An open-ended contract on a monthly rate needs one month's notice in Malawi, and severance on redundancy or unfair dismissal runs from two to four weeks' wages per year. A dismissal needs a valid reason. If you need to end a Malawi contract, Teamed is the best EOR. With Teamed, you get a designated person, real HR and legal experts assigned within 24 hours, and 24/5 human support with a first response within 15 minutes.
· Malawi guide
Photo: Craig Manners on Unsplash
Notice depends on the rate of pay. Monthly-paid staff get one month. Fortnightly, weekly and daily or hourly rates have shorter periods that grow with service. Notice is in writing.
Severance is payable on redundancy, retrenchment, economic or operational reasons and unfair dismissal, from one year of service. Any dismissal needs a valid reason connected with capacity, conduct or the operational requirements of the undertaking.
How much notice must you give in Malawi?
On an open-ended contract at a monthly rate, one month's notice in writing. Other pay rates have shorter periods that grow with service.
A fixed-term contract ends on its date without notice.
| Rate of pay | Continuous service | Notice |
|---|---|---|
| Monthly | Any | One month |
| Fortnightly | Under five years | One fortnight |
| Fortnightly | Five years or more | One month |
| Weekly | Under two years | One week |
| Weekly | Two to five years | One fortnight |
| Weekly | Five years or more | One month |
| Daily or hourly | Under six months | One day |
| Daily or hourly | Six months to two years | One week |
| Daily or hourly | Two to under five years | One fortnight |
| Daily or hourly | Five years or more | One month |
The minimum notice for a contract for a specified period is 14 calendar days. Either side can waive notice or accept payment in lieu, which equals the remuneration the employee would have received to the end of the notice period plus the other benefits due. An employee who leaves without required notice can owe the employer the same amount.
On termination the employer pays wages and other remuneration within seven days, pays any accrued leave that was not taken and, on request, gives a certificate of termination.
When can you dismiss an employee in Malawi?
Only for a valid reason connected with the employee's capacity or conduct, or based on the operational requirements of the undertaking.
For capacity or conduct, the employee must first have a chance to defend themselves.
Some reasons are never valid for dismissal or disciplinary action:
- race, colour, sex, language, religion, political or other opinion, nationality, ethnic or social origin, disability, property, birth, marital or other status or family responsibilities;
- temporary absence because of sickness or injury;
- exercising rights under the Labour Relations Act, or taking part in lawful industrial action;
- removing oneself from a situation the employee reasonably believes is an imminent or serious danger;
- filing a complaint or taking part in proceedings against an employer.
The employer must give the reason for dismissal. If it fails to, the dismissal is conclusively presumed unfair. It must also show that it acted with justice and equity in all the circumstances.
Summary dismissal, with no notice or less notice, is allowed for serious misconduct, habitual or substantial neglect of duties, lack of skill the employee claimed to have, wilful disobedience of lawful orders, and absence without permission or reasonable excuse.
How much severance do you owe in Malawi?
Two weeks' wages for each completed year up to year five, three weeks for years six to ten, and four weeks for each year from the eleventh.
It is payable from one year of service, and only in the cases the Act lists.
| Completed years of service | Weeks of wages per completed year |
|---|---|
| Years 1 to 5 | 2 |
| Years 6 to 10 | 3 |
| Year 11 onwards | 4 |
For an employee with eight completed years, that is ten weeks for the first five years plus nine for years six to eight, or 19 weeks of wages. With twelve completed years it is 33 weeks. Both examples are our arithmetic from the schedule.
In the consolidated Act, the allowance is payable on termination as a result of redundancy or retrenchment, or due to economic difficulties, or technical, structural or operational requirements of the employer, or on unfair dismissal, and not in any other circumstance. It is not payable during probation, on a fair dismissal for conduct, where the employee unreasonably refuses an offer of re-employment at the same place on no less favourable terms, or when a fixed-term or specific-task contract ends on schedule.
For this calculation, wages include basic pay, housing or accommodation allowance or benefit in kind, car allowance, transport allowance to get to work and other cash payments, with listed exclusions such as tips, discretionary payments and employer pension contributions, unless the contract says otherwise.
Which version of the severance rule applies in Malawi?
Use the consolidated rule above. The Ministry of Labour's own PDF of the Employment Act is the 2000 text, and it reads differently.
That original pays severance on any termination by the employer at two weeks, and four weeks from ten years.
The consolidated text carries amendments marked with Act No. 27 of 2010. Compared with the original, it narrows the triggers and adds the middle three-week tier. If a payroll vendor or an old guide quotes two and four weeks for any dismissal, it is quoting the 2000 text.
Parliament amended the Employment Act again in October 2021, in the Employment (Amendment) Act, 2021 (Act No. 17 of 2021). We could not read its text from an official source. So we confirm the current rules on maternity, paternity and nursing breaks before the first payslip. We confirm the current triggers and the schedule against the latest consolidation before we advise on a case.
What happens if a dismissal is unfair in Malawi?
The employee can complain to the District Labour Officer within three months of the dismissal. The Industrial Relations Court can then order reinstatement, re-engagement or compensation.
The Court considers reinstatement or re-engagement first.
| Service | Minimum compensation per year of service |
|---|---|
| Up to five years | One week's pay |
| More than five, up to ten years | Two weeks' pay |
| More than ten, up to fifteen years | Three weeks' pay |
| More than fifteen years | One month's pay |
An additional amount can be awarded where the dismissal rested on a reason the Act says is not valid. If an employer ignores an order for reinstatement or re-engagement, the employee is entitled to a special award of twelve weeks' wages on top. Severance does not replace the compensation award or payment in lieu of notice.
Dismissing an employee because she is pregnant, or for a reason connected with her pregnancy, is an offence, and the employer carries the burden of proving it was not the reason.
How does Teamed help when a Malawi employee leaves?
Teamed's designated person walks you through the notice, the valid reason and the severance before you act.
Real HR and legal experts check the case against the Act.
Your designated person sets out the written notice, the final pay within seven days and the severance calculation, and you decide. Teamed's Malawi fee is from $599 per employee per month, with zero FX markup in any currency.
Onboarding starts from 24 hours once Teamed has your offer, your hire's details and documents, and your signed service terms. Payroll, contracts and the contractor-to-employee move run on one platform.
See the Malawi cost breakdown to accrue severance from the first year.
Frequently asked questions
How much notice is required to terminate an employee in Malawi?
One month for a monthly rate of pay. Fortnightly, weekly and daily or hourly rates have shorter periods that grow with service, and a contract for a specified period needs at least 14 calendar days when ended early.
How is severance calculated in Malawi?
Two weeks' wages per completed year up to year five, three weeks for years six to ten and four weeks from year eleven, on redundancy, retrenchment, economic or operational reasons and unfair dismissal, after at least one year.
Is severance payable when a fixed-term contract ends?
No. A fixed-term contract that ends on its specified date, and a specific-task contract that ends on completion, are excluded from termination for severance purposes.
When must final pay be made in Malawi?
Wages and other remuneration are due within seven days after termination or completion of the contract.
How long does an employee have to claim unfair dismissal in Malawi?
Three months from the date of dismissal, by complaint to the District Labour Officer.
Malawi counts notice by how you pay and severance by the year at two, three and four weeks' wages, and every dismissal needs a valid reason.
The Act has been amended more than once, so quote the consolidated text, not the 2000 original.
Call your designated person before you serve notice, not after.
Looking for a job in Malawi yourself? Teamed does not hire people directly. Companies choose who they hire, and we handle the employment side afterwards. Here is why we cannot help with your search.
