Introduction

On March 28, 2025, the Use of Foreign Currency Regulations, 2025 (“UFCR 2025”), published through the Government Notice No. 198, were introduced in Tanzania. The UFCR 2025 were issued under section 70 of the Bank of Tanzania Act, 2006 (“BOT Act”) to reinforce the exclusive use of the Tanzania Shilling for domestic transactions. A significant area affected by these regulations is the use of foreign currencies in contracts for, among others, pricing of or payment for goods and services.

This includes employment contracts particularly, those using foreign currencies, like United State (US) Dollar and other foreign currencies, in payment of the employees’ remuneration. This article examines the legal and practical impact of the UFCR 2025 on employment contracts denominated in foreign currency and proposes potential strategies for both employers and employees to navigate the changes and adopt the new regulatory landscape.