Located on the southeast of Florida, USA, the Bahamas is an archipelago in the Atlantic Ocean, with an economy dependent on tourism and overseas financial services (comprising more than 60% of its GDP). Other sectors contributing to its economy include agriculture and fisheries, oil, pharma, rum distillation, ship repair, sea salt production, and mining. The government is likely to privatize state-owned enterprises to reduce its burden of non-performing loans.

Currency: Bahamian Dollar

Principal Languages: Bahamian English and Haitian Creole

Government: Parliamentary System, Constitutional Monarchy, Unitary State

Capital City: Nassau

Other Major Cities: Lucaya, Freeport, West End, Coopers Town

Employment Contracts

Under the labor code, an employment agreement is defined as a contract of service or apprenticeship, whether express or implied. Contracts can be verbal or in writing.

Work/Time Regulations

The standard workday is 8 hours, and the standard workweek is 40 hours in a week. These restrictions do not apply to supervisory or managerial positions. Employers must provide employees with 12 consecutive hours of rest between shifts and must provide employees with a weekly rest period of at least 48 hours. Employers must also provide employees an hour long meal break.



The public holidays specified in the Public Holidays Act are:

  • Jan. 1: New Year's Day
  • First Monday after Easter Monday
  • The Monday after Whitsunday: Whit Monday
  • The First Friday in June: Labor Day
  • July 10: Independence Day
  • The First Monday in August: Emancipation Day
  • Oct. 12: National Heroes Day
  • Dec. 25: Christmas Day
  • Dec. 26: Boxing Day.

Annual Leave
Employers must provide all employees with 2 weeks of paid annual leave after employees complete a year of work. The leave provision must be paid based on the length of service. Employees who have worked for more than 6 months but less than a year and receive annual leave, must be paid for at least 1 week of leave.

Employees who have worked at least a year, but less than 7 years, must be compensated with 2 weeks basic pay upon taking leave. Employees who have worked at least 7 years must be compensated with 3 weeks basic pay upon taking leave. Vacation pay must be paid at least 1 day before the commencement of the employee's leave.

Sick Leave 
Employers must provide all employees who have been working for at least 6 months with 1 week of paid sick leave per year.

Maternity Leave
Employers must provide pregnant employees with 12 weeks of paid maternity leave for all employees who have worked at least 1 year. Employers must pay those on maternity leave 33.33% of their normal pay, as long as it is an employee's first time on maternity leave in the last 3 years. Otherwise, the leave is unpaid by the employers.

In all cases, employees also receive maternity payments from social security. Employers must grant unpaid leave of at least 6 additional weeks for a pregnancy-related illness.

Family Leave
Employers must provide all employees who have worked at least 6 months with unpaid leave for 1 week following the birth of a child or the death or illness of a child, spouse, or parent.

Other Leave
Employees who have been employed for at least 6 months are entitled to 1 week of unpaid leave for the death or illness of a spouse or parent.


Pension and Social Security

The minimum age for retirement is 65 years with 150 weeks of contributions to the social security system. Employers contribute 5.9% of payroll to National Insurance, which includes pension benefits; employees contribute 3.9% of wages.

Social security benefits are provided for maternity, sickness, unemployment and workplace injuries. Sickness payments are made weekly to eligible insured persons who are temporarily unable to work due to an illness which is not an employment injury. They are paid at a weekly rate of 60% of the employee's average weekly covered earnings after a 3-day waiting period for up to 26 weeks.

To qualify for a sickness benefit, a person must be employed on the day of or on the day prior to the onset of the illness. Additionally, the individual must have:

  • paid at least 40 contributions into the National Insurance Program, and
  • paid and/or been credited with at least 13 contributions in the 26 weeks immediately before the week the illness started, 26 contributions in the 52 contribution weeks immediately before the week the illness started or 26 contributions in the immediate preceding contribution year.

Workers' Compensation
Employers in the Bahamas must contribute to National Insurance, which is administered by the National Insurance Board (NIB). Contributions pay for sickness, invalidity, maternity, retirement, death, workers' compensation, and unemployment benefits.

Coverage: Employers must withhold National Insurance contributions and make additional contributions for all workers, regardless of nationality, legal status, or length of service.

 Rates and Thresholds: Employers must contribute 5.9% of payroll to National Insurance, while employees must contribute 3.9% of their salary. The maximum computable salary for the calculation of National Insurance contributions is BSD$650 per week or BSD$ 2,817 per month.

How GPS can Help

With our Global PEO/Employer of Record services, companies can expand into Bahamas and hire their employees without having to establish a branch office or subsidiary in Bahamas.

  • Your candidate is hired via our Bahamas PEO. If needed, we can also help you find the right talent in any country with our comprehensive global staffing services
  • Your new employee begins work quickly as we take care of employment contracts, statutory and non-statutory benefits, and running their payroll – all in full compliance with the Bahamas laws
  • Global PEO Services experts manage all day-to-day operational issues, such as employee expenses, and severance/termination if required.
  • No contractor risks, pass on the compliance burden to Global PEO Services.

 Spin Off/M&A Support

  • Ensure continuity of payroll, benefits and HR support when acquiring or spinning off a business with employees overseas.

24/7 Support in 150+ Countries

  • Empower your teams with 24×7 support and a single point-of-contact model in which experienced client services directors are in continuous communication with information and advice.
  • We are backed by a mix of 300+ multidisciplinary experts from HR, Payroll, Finance, Tax, and Legal domains who are ready to respond to the expected and unexpected needs of your business on the shortest notice.

Easy Visibility into Your Employee Time & Attendance and Benefits Data

With our Global PEO, you get access to our proprietary Mihi SaaS solution for time and attendance, vacation, leave management and benefits enrollment and management. Mihi enables clients to have easy access to employee data in real time. It is designed specifically for companies with a global workforce, especially when working in multiple countries with low headcount.

Ready for Growth When You Are

When ready, we can seamlessly transition you from the PEO/EOR model to your own legal entity and provide ongoing international HR, finance, legal, compliance and staffing support. Learn more about our end-to-end international expansion services here.

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