Your quick guide on talent and labor compliance norms in Iraq
Capital
Baghdad
Currency
Iraqi Dinar (IQD)
Languages
Arabic and Kurdish
Payroll Frequency
Monthly
GDP per Capita
$6,247.25
Employer Tax
12%
Talent Overview
Iraq is one of the easternmost nations in Asia. It is rich in petroleum reserves and is the world’s fourth-largest petroleum producer. The economy of Iraq is largely dominated by the oil sector, which provides around 92% of its foreign exchange earnings. Textile, chemicals, and leather are a few other industries that are prominent in Iraq. Iraq’s GDP fell sharply due to the Covid-19 pandemic. However, in 2021 and 2022, as oil prices surged, Iraq’s GDP witnessed a surplus of 8.3%, bringing it up to the 51st position in the global GDP rankings.
Major economic hubs:
Baghdad, Basrah, Al Mawsil Al Jadidah, Al Basrah Al Quadimah
Skills in demand:
Finance, Supply Chain, Marketing, Production, English Language Training
Local Universities
Local: 1
World: 4418
Local: 2
World: 5277
Local: 3
World: 5700
Local: 4
World: 5892
Local: 5
World: 5933
Salary Data
| Job Title | Average Monthly Salary (in IQD) | Average Monthly Salary (in USD) |
| Financial Manager | 4,100,000 | 3,132 |
| General Manager | 3,780,000 | 2,888 |
| Business Development Manager | 3,350,000 | 2,560 |
| Financial Analyst | 2,690,000 | 2,055 |
| Business Analyst | 2,770,000 | 2,116 |
| Project Manager | 2,470,000 | 1,887 |
Talent Sourcing Tips
1,876,000
The employer must know the employment laws, statutory benefits, and deductions to hire an individual from Iraq. The section below mentions all the necessary details the employer needs to know while hiring an individual from Iraq.
Employment contracts in Iraq are required to be in Arabic. However, it can also be drafted in Kurdish for organizations in autonomous parts of Kurdistan.
The probation period for Iraqi employees is up to three months.
| Date | Name | Type |
| 1 Jan | New Year’s Day | National holiday |
| 6 Jan | Army Day | National holiday |
| 5 Mar | Rebellion Anniversary | Regional holiday |
| 6 Mar | National Day of Tolerance and Coexistence | National holiday |
| 11 Mar | Anniversary of Signing of the March 11, 1970 Agreement | Regional holiday |
| 14 Mar | Birth Anniversary of the Immortal Barzani | Regional holiday |
| 21 Mar | Nowruz | National holiday |
| 22 Mar | Nowruz Holiday | Regional holiday |
| 23 Mar | Nowruz Holiday | Regional holiday |
| 3 Apr | Yazidi New Year | Regional holiday |
| 9 Apr | Baghdad Liberation Day | Regional holiday |
| 9 Apr | Fall of the Defunct Dictatorial Regime and the Liberation of Iraq Day | Regional holiday |
| 10 Apr | Eid al-Fitr (Tentative Date) | National holiday |
| 11 Apr | Eid al-Fitr holiday (Tentative Date) | National holiday |
| 12 Apr | Eid al-Fitr holiday (Tentative Date) | National holiday |
| 1 May | Labor Day | National holiday |
| 16 Jun | Eid al-Adha (Tentative Date) | National holiday |
| 17 Jun | Eid al-Adha holiday (Tentative Date) | National holiday |
| 18 Jun | Eid al-Adha holiday (Tentative Date) | National holiday |
| 19 Jun | Eid al-Adha holiday (Tentative Date) | National holiday |
| 7 Jul | Islamic New Year (Tentative Date) | National holiday |
| 14 Jul | Republic Day | National holiday |
| 16 Jul | Ashura (Tentative Date) | National holiday |
| 15 Sep | The Prophet’s Birthday (Tentative Date) | National holiday |
| 3 Oct | Iraqi Independence Day | National holiday |
| 10 Dec | Anniversary of Victory over ISIS | National holiday |
| 25 Dec | Christmas Day | National holiday |
| Type of Leave | Time Period | Mandatory |
| Annual Leave | 20 days | Yes |
| Sick Leave | 30 days | Yes |
| Maternity Leave | 62 days | Yes |
Payroll
Payroll Cycle
Payroll in Iraq is released on a monthly basis.
Minimum Wage
The minimum wage in Iraq varies from IQD 250,000 to IQD 350,000.
Overtime Pay
The standard working hours in Iraq are 8 hours per day and 48 hours per week. The overtime pay is set to 150% over base pay.
Bonus
There is no statutory law for the 13th-month pay in Iraq.
Employers can provide their employees with additional benefits upon mutual discussion. Some of these benefits may include
Taxes
| Fund | Contribution |
| Social Security | 12% |
| FundTax Type | Contribution |
| Social Security | 5% |
Income tax in Iraq ranges from 3% to 15%, depending on the annual income.
| Annual Income | Tax Rate (%) |
| 0 – 250,000 | 3% |
| 250,001 – 500,000 | 5% |
| 500,001 – 1,000,000 | 10% |
| Above 1,000,000 | 15% |
There is no VAT in Iraq; however, sales tax is levied on certain goods and services, and it ranges from 10% to 300%, depending on the nature of the goods.
Offboarding & Termination
Employment in Iraq can be terminated both by the employee and the employer. The employer can terminate the employment on substantial grounds. If the employment is terminated without any grounds, the employer must pay a severance to the employee. An employer may also terminate the contract during the probation period (three months), in this case, the notice given will be only seven days. If the employer/employee terminates the employment without a notice, then the other party will be entitled to compensation amounting to the salary of 30 days.
A 30-day notice is mandatory for both permanent employees and employees on probation.
Severance pay in Iraq is set to 2 weeks’ pay for every year of service.
Visa and Immigration
Non-Iraqi employees must obtain a work permit before being employed in Iraq. This permit is valid for one year at a time and can be renewed one month before the expiration date. Non-citizens must show proof of employment before applying for a work permit in Iraq.
