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Spotlight on Morocco

view over Casablanca, Morocco

Morocco, situated in the Maghreb region of North Africa, boasts a population of over 38 million people and is renowned for its rich history, diverse culture and breathtaking landscapes. The country is rapidly emerging as a compelling option for foreign direct investment (FDI). With a diversified economy and a skilled yet cost-effective workforce, Morocco offers a host of opportunities for multinational companies (MNCs) seeking to expand their operations.  Morocco’s strategic location, investment incentives and growing innovation ecosystem make it an ideal destination for businesses looking to expand their footprint in the Arab world, North Africa and beyond.

  • Strategic location: Morocco is situated at the crossroads of Africa, Europe and the Middle East. The country has direct access to the Mediterranean Sea and the Atlantic Ocean, making it an ideal hub for trade, supply chain diversification and business investment. 
  • Market potential: Morocco is the fifth-largest economy in Africa with a fast growing middle class. The country’s economy is diversified across several sectors, including agriculture, mining, manufacturing and tourism. With a large population and a growing market, Morocco presents a significant opportunity for MNCs looking to expand their operations.
  • Investment incentives: The Moroccan government has implemented several measures to encourage foreign investment, including tax incentives and free trade zones. The Moroccan Investment Development Agency (AMDI) also provides support for foreign investors, from project development to aftercare services.
  • Talent pool: Morocco has a young, skilled and multilingual workforce. Many professionals are fluent in French, Arabic and English. The country has several universities and vocational schools that offer training in various fields, including engineering, finance and IT. 
  • Innovation: Morocco is ranked as one of the top lower middle income economies in the world, according to the Global Innovation Index. The country’s growing startup ecosystem is ranked as second in North Africa, according to StartupBlink

How is employment law determined in Morocco?

Employment law in Morocco is determined by a combination of legislation, collective bargaining agreements and labor court decisions. The primary source of employment law is the country’s Labor Code, which sets out the basic legal framework for employment relationships in Morocco.

The Labor Code covers various aspects of employment, including working hours, wages, social security, health/safety and termination of employment. Employers are required to comply with the provisions of the Labor Code. Violations can result in legal action and financial penalties.

In addition to the Labor Code, collective bargaining agreements between employers and trade unions also play a significant role. These agreements, which are legally binding, cover a wide range of issues, including salaries, working conditions and job security. Employers are required to negotiate with trade unions in good faith. 

Labor courts are responsible for adjudicating disputes between employers and employees. Such decisions can set legal precedents that influence future cases.

Are written employment contracts required?

Employers must issue written employment contracts of indefinite duration to their workers. These contracts must detail the essential terms of employment, which comprise working hours, weekly rest days schedule, wage payment frequency, industry-specific health/safety regulations, relevant collective agreements and insurance for occupational accidents and illnesses. 

For an employment contract to be legally binding, the parties involved must enter into it voluntarily with full capacity to do so. Both indefinite and fixed-term contracts are required to be in written form and signed by the employer and the employee. The contract must be issued in duplicate, and the employee must retain one of the copies.

What do MNCs need to know about probation periods? 

While not compulsory, probationary periods are permitted in Morocco. The duration of the probationary period varies according to the type of contract. 

  • For indefinite-term contracts, it ranges from 15 days for blue-collar employees to three months for managers/executive level employees. The probation period can be extended only once, for the same period as initially agreed upon. 
  • For fixed-term contracts, the probation period is limited to one week for contracts of less than six months and one month for contracts of six months or more.

How do bonuses work? Are they required?

Employees who have served for a period of two years in a company are entitled to receive a seniority bonus, unless it is explicitly stated otherwise in the employment contract, work rules or a collective agreement. 

The seniority bonus is an extra payment provided to the employee, in addition to their regular salary. The amount increases with the length of their employment as follows:

Years of service   % of Gross Wage  
>2   5.0  
>5   10.0  
>12   15.0  
>20   20.0  
>25   25.0  

The seniority bonus calculation takes into account various elements including basic wages, overtime supplements and additional payments such as profit-sharing payments or certain bonuses. The calculation excludes tips.

What do MNCs need to know about terminations?

If an employee is being dismissed due to misconduct, they must be given an opportunity to defend themselves and be heard by the employer or its representative. The employer must inform the employee of the decision to have a hearing within 48 hours of when the misconduct is made known. The hearing must take place no more than eight days from when the employer is made aware of the misconduct. Meeting minutes must be written up and signed by both parties. The employee must be given a copy. Both the employer and employee must cooperate in this procedure, otherwise either party will have the right to call the labor authority. 

An employer can only dismiss an employee on an indefinite-term contract with a valid reason, whether it is related to their performance or because of company operational requirements. 

Under the Labor Code, the following grounds can never constitute a valid reason for dismissal: 

  • Race or color
  • Sex
  • Marital status
  • Family responsibilities
  • Religion
  • Political opinions
  • National descent or social origin
  • Disability (to the extent that this does not prevent the employee from carrying out their job adequately)
  • Trade union membership or role as a trade union representative
  • The employee having brought a complaint or participated in legal proceedings against the employer (in accordance with the Labor Code)

Why are many MNCs now choosing to hire through an Employer of Record (EOR) in Morocco?

Morocco is an attractive location for MNCs looking to expand globally due to its strategic location, skilled workforce and innovative economy. However, setting up a legal entity in Morocco can be a complex process, involving navigating bureaucracy, filing paperwork and meeting legal requirements. Additionally, regulatory compliance, taxation, reporting, payroll processing and other factors require a learning curve for the internal HR team back in the home country.

To overcome these challenges, many companies are now going the route of partnering with a qualified Employer of Record (EOR), such as GoGlobal. This arrangement allows companies to hire a local team without setting up a legal entity, comply with local regulations, reduce costs and enhance agility in hiring – all while mitigating employment risks. 

The EOR model may be a temporary solution or a long-term solution that allows them to tap into the Moroccan workforce quickly and compliantly.

Why do leading companies choose to hire through GoGlobal in Morocco?

Our team on the ground in Morocco takes a people-first approach to HR. We prioritize human touch points throughout the hiring process, utilizing cutting-edge technology solutions while deeply understanding the local customs and culture. We can offer workers services in English, French or Arabic and in their preferred time zone – ensuring a positive and customized experience for all parties involved.

What sets GoGlobal apart is our proven expertise in navigating the complex legal and regulatory landscape in Morocco. Our dedicated team members know the country’s regulatory environment and are experts in navigating the labor market’s unique conditions and business culture. This generates a positive experience for our clients as well as client-workers.

Our clients can also complement GoGlobal’s EOR services with our Recruit & Hire solution, which takes over the entire hiring process – from talent sourcing to onboarding, benefits and offboarding. This innovative offering can help companies hire and manage headcount for hard-to-fill roles like IT, sales and client services – all in one solution package.

Partnering with GoGlobal in Morocco not only provides a seamless hiring experience but also allows companies to confidently enter the market and thrive in a competitive business landscape.

GoGlobal has a significant on-the-ground footprint in Africa, maintaining local offices across 18 countries spanning from North Africa to Sub-Saharan Africa. This extensive on-the-ground footprint empowers GoGlobal to offer exceptional assistance to clients in expanding their operations and building successful teams across Africa.

Find additional details on benefits and hiring in Morocco or contact us to talk with an international HR expert.