Expand your organization into Mongolia with or without a Mongolian entity
The large Asian country of Mongolia has enormous economic potential. Although trade has traditionally been largely based around the mining of its vast natural resources, the country is gradually diversifying its economy which is set to grow significantly in coming years.
If your organization is planning an expansion into Mongolia, your progress may be stalled by the difficult, often slow, legal and cultural procedures in the country. If you are unfamiliar with the local customs, procedures, and language, you may hit delays, which could result in costs mounting and cutting into your profits.
At New Horizons, our experienced expansion team helps businesses expand into Mongolia. Our tailored professional employer organization (PEO), employer of record, and payroll services can provide you with all the support you need to efficiently expand your business into Mongolia, whether or not you have already established a Mongolian entity.
We have an in-house recruitment team, so we can source, recruit, and onboard your new staff members. Additionally, you can use our Mongolian subsidiary to act as employer of record for your new hires, so you don’t even need to register an entity in the country but will have total autonomy over your employees.
Our outsourcing solutions could save you thousands in expansion costs and can help you expand in a compliant, flexible, and scalable way.
Our Mongolia PEO simplifies your expansion
New Horizons enables your business to expand its operations into Mongolia- without setting up a legal subsidiary.
Hiring in Mongolia: Employment law overview
Employment contracts in Mongolia
When hiring in Mongolia, employers are legally required to provide written contracts of employment. These contracts should always include any relevant details of the employment, such as salary/wage information, expected duties, and working hours, and should be written in Mongolian and use the local currency of Mongolian tugrik (or tögrög).
Working hours in Mongolia
The standard working week for employees in Mongolia is 40 hours spread over five days.
Public holidays in Mongolia
There are several public holidays in Mongolia, for which most employees receive the day off each year.
- New Year’s Day
- Day of the Proclamation of the People’s Republic
- International Women’s Day
- Lunar New Year (two days long)
- Mother and Child Day
- Naadam (five days long)
Mongolia vacation leave
Employees in Mongolia are usually entitled to a base allowance of 15 days, which increases with the employee’s length of service. After six years of service, employees are granted an additional three days of paid vacation leave, and this increases gradually up to a maximum of 14 extra days after 32 years of service.
Mongolia sick leave
Employees in Mongolia are usually entitled to unlimited sick leave if they require it.
Parental leave in Mongolia
Female employees in Mongolia are entitled to four months (120 days) of paid maternity leave. This period is compensated at a minimum of 70% of normal pay.
Terminations and severance in Mongolia
Employers and employees in Mongolia are generally required to give notice of termination of an employment contract. The length of notice depends on the precise reason for termination, but usually between 30 days and two months. Additionally, employees are usually entitled to around 30 days of normal pay as severance upon dismissal.
Taxation in Mongolia
Employees and employers in Mongolia are both required to pay toward social security. Each pay equally, with 7% of salary paid to pension, 0.2% to unemployment insurance, and 2% to medical insurance. Additionally, employees must pay a small contribution toward benefit insurance (up to 3%).
Income tax in Mongolia is progressively rated so varies depending on income level. For residents, the rates are between 10% and 40%. For non-residents, there is a flat rate of 20%.
Corporate tax in Mongolia is set at between 1% and 25% depending on profits.
Health coverage in Mongolia
There is a state-funded healthcare system in Mongolia, but many employers do offer private medical insurance to employees so it may be expected as part of a benefits package.
Mongolia compensations & benefits
Compensation laws in Mongolia
The mandatory minimum wage in Mongolia is set at 420,000 tugriks per month (as of 2020).
Benefit management in Mongolia
Employees in Mongolia often expect benefits packages as part of their employment agreements, so you may need to set up a benefits management system when hiring in the country. But setting up and managing a benefits system in Mongolia can be complicated, particularly if you are unfamiliar with the country’s unique regulations and procedures.
Outsourcing your benefit management process can save you time and money, and ensure you are fully compliant with the relevant laws. New Horizons can simplify your Mongolia benefits management, with our Mongolia experts setting up and managing everything for you to help you focus on a successful expansion operation.
New Horizons will simplify your expansion into Mongolia
At New Horizons, we specialize in providing tailored employer of record, PEO, and payroll outsourcing services to give businesses everything they need to begin trading in Mongolia as efficiently as possible. Our experts will ensure that you are ready to start trading and hiring in Mongolia in as little as 48 hours and could save you more than 80% in expenditure, whether or not you’ve already registered a legal entity in the country.
New Horizons can manage your company’s payroll, benefits, and expenses in Mongolia. Additionally, we can oversee HR duties, as well as employment and tax compliance. And as the only global PEO with an in-house recruitment team, New Horizons will source, hire, and onboard your local workforce.
Contact us today to discover how our Mongolia-specific services can support your expansion.