Payroll Process Overview
The payroll process is a critical function where a company manages its personnel costs.
These costs consist of Direct Salary (cash compensation), Benefits in Kind (goods or
services provided for free), and Indirect Salary (employer social and tax contributions).
I. Components of Gross Salary
Gross salary is divided into two main categories: the principal salary and salary accessories.
1. Principal Salary
• Base Salary: Calculated on a legal work week of 40 hours, which equates to 173.33
hours per month.
• Overtime: Hours worked beyond the standard 40-hour week5. Overtime is capped
at 20 hours per week and cannot exceed 10 hours per day or 60 hours per week.
Overtime Pay Rates: | Overtime Category | Increase Rate | | :--- | :--- | | 1st Tier (41st to
48th hour) | 20% 7 | | 2nd Tier (49th to 56th hour) | 30% 8 | | 3rd Tier (57th to 60th hour) |
40% 9 | | Sunday Overtime | 40% 10 | | Night Overtime | 50% 11 | | Non-working days (Force
Majeure) | 50% 12 | | Public Holidays | 100% 13 |
2. Salary Accessories
• Bonuses and Cash Benefits: Including seniority, performance, and year-end
bonuses14.
• Expense Reimbursements: Indemnities for costs incurred by the employee, such
as travel, tools, or clothing15.
• Benefits in Kind: Free provision of housing, vehicles, water, electricity, or
telephone16.
II. Calculation Bases
To determine taxes and social contributions, two primary bases are used:
1. Taxable Salary (ST)
Used as the basis for calculating income taxes. It includes17:
• Normal and overtime pay18.
• Leave pay19.
• Various bonuses (including transport)20202020.
• Benefits in kind21.
2. Contributable Salary (SC)
Used as the basis for social security contributions. It includes22:
• Normal and overtime pay23.
• Notice period indemnity (indemnité de préavis)24.
• Function, responsibility, and housing bonuses25.
• Cash payments representing benefits in kind26.
III. Deductions (Employee & Employer)
1. Employee Deductions
These are withheld from the employee’s gross pay to arrive at the Net Salary27272727.
• Fiscal (Taxes): Personal Income Tax (IRPP), Cameroon Housing Fund (CFC - 1% of
taxable salary), Audiovisual Tax (RAV), and Council Tax (TC)28.
• Social: Old age, disability, and death insurance (4.2% of the contributable salary,
capped at 750,000 francs/month)29292929.
• Other: Union dues (1% of base salary), salary advances, and court-ordered
attachments30.
2. Employer Charges
Additional costs borne by the employer31.
• Fiscal: CFC (1.5% of taxable salary + reimbursements) and National Employment
Fund (FNE - 1% of taxable salary + reimbursements).
• Social: Family allowances (7% of capped salary) and Work Accident insurance
(1.75% to 5% depending on risk level).
IV. Paid Leave (Congés Payés)
• Eligibility: Employees are entitled to leave after 12 months of service.
• Duration: Normally 1.5 working days per month (18 days per year); 2.5 days per
month for managers (30 days per year).
• Accrual: Increases by 2 days per minor child for mothers, and 2 days for every 5
years of seniority.
• Allocation: The leave allowance equals $1/16^{th}$ of the total remuneration
received during the reference period.
V. Mandatory Payslip Mentions
Every payslip must include:
1. Employer name, address, and CNPS registration number.
2. Employee full name.
3. Employee registration number (matricula, ID)
4. Professional classification and position.
5. Salary rate (monthly, daily, or hourly).
6. The pay period
7. Gross remuneration breakdown (normal hours, overtime hours/rates, bonuses).
8. Deductions made from gross pay.
9. Net salary amount.
10. Date of payment.