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Cumulative Director vs Employment Contract

The limited company can be administered by a Board of Directors composed of directors who may or may not be shareholders.

These directors have the role of managing the affairs of the company and in return for their functions they may receive remuneration.

OHADA law governs the remuneration of directors of an SA; this remuneration can take several forms:

1- Functional allowances vs Exceptional remuneration

The Uniform Act provides for different methods of remuneration for directors.

But this remuneration is strongly regulated by law. Indeed, directors can receive an annual office allowance, the amount of which is set by the ordinary general meeting.[1]. And they can also receive exceptional remuneration for missions and mandates entrusted to them[2].

  1. a) The characteristics of the job allowance:


  1. She is not OBLIGATORY.
  2. She is annual, and can be tacitly renewed, unless there is a new decision to delete or modify the amount by a subsequent General Meeting.
  3. It is subject to a formalism: only the Ordinary General Meeting meets according to the conditions of quorum and majority, can decide on the allocation of the job allowance. This General Assembly will fix globally the amount to be allocated to directors.
  4. Its distribution is the exclusive competence of the Board of Directors. He will proceed “ freely » to a share unequal or egalitarian between administrators.
  5. It is independent of operating results, and can be attributed even in the absence of profits.
  6. She can vary depending on whether or not you belong to a committee.[3]
  1. b) Exceptional remuneration

Exceptional remuneration is received in the context of missions that directors carry out on behalf of the company and which fall outside the scope of directors' duties.

It can also be about reimbursements travel costs, travel and expenses, incurred in the interest of the company subject to the provisions of article 438 on regulated agreements.


2) Remuneration within the framework of an employment contract

The administrator of a company can have the status of employee provided that the employment contract corresponds to actual employment.

The administrator is in principle a corporate officer but he can be considered an employee if several conditions are met:

  • Technical functions are clearly defined in the employment contract;
  • The existence of a relationship of subordination with regard to the company;
  • The presence of a salary distinct from the remuneration he receives as part of his corporate mandate.

The remuneration in the employment contract is added to the sums that the administrator receives as part of his official allowances and special mandates.

[1] Art 431 AUSCGIE

[2] Art 432 AUSCGIE

[3] BETICKA.T. “OHADA: A thousand facets of an administrator’s remuneration”, the Business Bloc in Africa

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