Barbados has transformed from an agricultural into a diversified economy built on offshore banking, services, light industry, tourism, and sugar that generate one of the highest per capita incomes in the Caribbean. The island nation has a ‘high quality of life’ for a developing country. The process for setting up a business has been made simpler and, the regulatory environment is relatively transparent and straightforward.

Currency: Barbados Dollar (BBD)

Principal Languages: English, Bajan dialect

Government: Parliamentary system, Constitutional monarchy

Capital City: Bridgetown

Major Cities: Saint Michael, Speightstown, Oistins, Bathsheba, Holetown

Employment Contracts

Under the Employment Rights Act 2012 (ERA), employment contract should include:

  • Employee name
  • Employer name and address
  • Place of work
  • Date of continuous employment
  • Employment commencement date
  • Description of the work
  • Title of the job
  • Intervals at which wages are paid
  • Rate of wages and the method of calculating wages
  • Probation period, if applicable
  • Normal working hours
  • Length of termination notice
  • Any collective agreements
  • Period of employment
  • Any terms relating to the following:
    • Entitlement to holidays and holiday pay
    • Pension and pension schemes
    • Incapacity owing to sickness or injury including any health scheme
  • Employers must provide an itemized pay statement to every employee before or when the salary is paid. The statement must include:
    • Gross amount of wages
    • Net amount of wages payable
    • Amounts of any variable or fixed deductions
    • Date of the pay period

Work/Time Regulations

The regular work schedule comprises 40 hours in 5 days. Employees are entitled to at least 15 days’ paid holiday and are covered by national insurance legislation and unemployment benefits legislation.



  • Jan. 1: New Year's Day
  • Jan. 21: Errol Barrow Day
  • Good Friday
  • Easter Monday
  • Apr. 28: National Heroes Day
  • May 1: May Day
  • Whit Monday
  • Aug. 1: Emancipation Day
  • The first Monday in August
  • Nov. 30: Independence Day
  • Dec. 25: Christmas Day
  • Dec. 26: Boxing Day

Annual Leave
Employees are entitled to 3 weeks’ annual leave after completing a year of employment with an employer. After completing five years of employment with an employer, employees are entitled to 4 weeks’ annual leave.

Sick Leave
Employees are required to provide their employer a certificate stating the amount of sick leave from a registered medical professional. The employer must ensure that the certificate contains the period of leave, date of visit, and date of return to work.

As employees have a right to privacy, a medical professional is not obligated to disclose the nature of the illness. On the other hand, the employer has the responsibility to provide reasonable accommodation. 

Maternity Leave 
Pregnant employees are entitled to 12 weeks’ maternity leave, out of which 6 weeks can be taken before the expected date of delivery and 6 weeks after it. If the date of delivery is later than the expected date, the maternity leave must be extended to include the elapsed period. In case of pregnancy-related complications, an additional 6 weeks’ leave can be granted based on a medical practitioner’s recommendation.

Additional Leave
An employee, who after confinement, suffers any illness arising out of such confinement shall be granted an additional leave. This leave, in addition to the maternity leave, is provided to employees under section 4 (not exceeding 6 weeks) as suggested by a medical practitioner.


Pension and Social Security

National Insurance
All employees (over 16 years of age and under pensionable age) should be insured under the National Insurance and Social Security Act, Cap. 47. Employers are required to obtain employees’ National Insurance Card to verify and enter the National Insurance number in their records except in cases where other arrangements have been made with National Insurance Board’s approval. If the employer does not obtain the National Insurance number from the employee within 7 days of employment, it must be obtained from the National Insurance Office within the next 7 days.

Unemployment Insurance
The coverage is provided to employees aged between 16 and 64 years. However, self-employed persons and permanent government employees are not required to make contributions toward the scheme. To qualify for unemployment benefit from the National Insurance Scheme:

  • An individual must be insured for at least 32 weeks
  • Have made at least 20 contributions in 3 consecutive quarters (the last one or one before that in which the individual became unemployed)

Once the claim period starts, a person cannot reclaim until a period of 52 weeks has passed. To claim for unemployment insurance, a person is required to register at the National Employment Bureau, complete a claim form, and report to the Unemployment Section every 2 weeks after qualification. If the person is unemployed for 3 weeks or less, funds are not paid for the first 3 days. The unemployment benefit is paid at the daily rate of 60% of an individual’s average insurable earnings for 6 days a week (excluding Sundays) for a maximum 26 weeks subject to an individual remaining unemployed.

Old-age Benefit

Old-age pension (social insurance): 
For the insured aged 56 years or more on December 31, 2002 (Old Basis Pension Calculation) – 40% of average annual insurable earnings and an additional 1% of earnings is paid for contributions exceeding 500 weeks.

For the insured aged 47 years or less on December 31, 2002 (New Basis Pension Calculation) – 2% of average annual insurable earnings for the first 20 years’ contributions and an additional 1.25% of earnings is paid for each year exceeding 20 years.

For the insured aged 47 to 55 years on December 31, 2002 – 50% of the pension is based on the Old Basis Pension Calculation and 50% on the New Basis Pension Calculation.

  • The maximum weekly earnings used to calculate benefits – B$1,006
  • The maximum monthly earnings – B$4,360
  • The minimum weekly pension – B$179
  • The maximum pension is 60% of average annual insurable earnings.
  • Benefits are adjusted each year according to changes in the cost of living.

Old-age grant (social insurance): A lump sum equal to 6 weeks of average annual insurable earnings is paid for every 50 weeks of paid contributions.

Noncontributory old-age pension: The minimum weekly pension is B$145.

Benefit adjustment: Benefits are adjusted every year according to changes in the cost of living.

Permanent Disability Benefits

Disability pension (social insurance) equal to 40% of average annual insurable earnings and an additional 1% of total earnings is used to calculate contributions if paid contributions exceed 500 weeks.

For 100% disability – 90% of the average annual insurable earnings is paid.

The degree of disability is assessed by the insured’s doctor, which may be reviewed by National Insurance Office doctors.

Constant-attendance supplement equal to 50% of the permanent disability pension is provided if the insured needs the constant attendance of others to carry out daily functions.

Partial disability: A percentage of the full pension is provided based on the assessed degree of disability and a lump sum is given if the degree of disability is less than 30%.

Survivor Benefits

Spouse's pension equal to 50% of the old-age pension or disability pension the deceased was receiving until death or was entitled to receive is paid to a widow/widower (aged 50 years or more) who was married to the deceased for a minimum 3 years. No age limit applies if the widow/widower is disabled. A limited pension is paid to a widow/widower (aged less than 50 years) for 12 months. The survivor pension stops on cohabitation or remarriage.

Orphan's pension equal to 16.67% of the old-age or disability pension the deceased was receiving until death or was entitled to receive is paid to each child aged less than 16 years (aged 25 years if a student).

  • 3% if disabled or a full orphan.

Funeral grant equal to a lump sum of B$1,995 is given to the person who incurs the funeral expenses.

Sickness and Maternity Benefits equal to 66.67% of the employee’s weekly insurable earnings is paid after 3 days (waiting period) for a maximum 26 weeks. The period can be extended for an extra 26 weeks if the employee has made 150 weeks’ paid contributions including 75 weeks’ contributions in the last 3 years before the incapacity began. The waiting period does not apply if the incapacity lasts for at least 14 days.

Unemployment Benefits equal to 60% of the employee’s weekly insurable earnings is paid after 3 days (waiting period) for a maximum 26 weeks in any 52-week period. The waiting period does not apply if the individual is unemployed for a minimum 21 days.

How GPS can Help

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

  • Your candidate is hired via our Barbados 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 Barbados laws.
  • Global PEO Services experts manage all day-to-day operational issues such as employee expenses, and severance/termination if required.
  • With 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 Mihi, our proprietary 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.