- Overview: Cyprus
- Global HR Compliance
- Global PEO and payroll
- Work permit for hiring expats via PEO
- Contractor vs. employee: which is better?
Global HR Compliance in Cyprus
If you hire an international workforce, or plan to hire, then Hiring and Firing Workforce in Cyprus Guide below will help you understand the nuances of labor legislation in the country.
When the company is planning to enter a new foreign market of Cyprus and has a need to employ a local national there, the first question to answer is how it is going to make local hires.
We have designed a Global Employer of Record service to help you outsource global employment of your foreign workforce to companies like ours.
This solution helps you employ your global sales force in Cyprus as well as in other 180+ countries of the world, and provide pay and benefits to your employees, as well as administer any business expenses with our help.
Our solution is different from other hiring modes in that it helps you engage your foreign workforce in full compliance with the local labor legislation. This means you are protected from any non-compliance and employee misclassification risks while we bear all employment risks, not you.
So, it looks very much like hiring your in-house sales force in your home country. However, you focus on only on your global business development while we admin your global HR. In addition, you don’t need to open your own entities in the foreign countries and can leverage our infrastructure in Cyprus instead. With our service, you can become a global company with reduced costs and minimized time and effort on your end.
Your employed foreign sales force will devote 100% of their time to your company product and may stay with you longer than foreign independent sales reps.
Global Employer of Record solution is 100% compliant solution that guarantees you and your employees fully compliance with local legislation in Cyprus .
We are experts in global workforce employment in Cyprus, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Cyprus.
Hiring and Firing Workforce in Cyprus Guide
# Employment contracts
According to the Cyprus Employment Law there are full-time and part-time employees with fixed-term contract and unlimited-term contract.
The written employment contract is not required in Cyprus, the Law Providing for an Employer’s Obligation to Inform Employees of the Conditions Applicable to the Contract or Employment Relationship 2000 (Law 100(I)/2000) imposes an obligation on the employer to provide to the employee, in writing, specific information regarding the terms of his employment. This information must include:
- The identity of the parties.
- The place of work and the registered address of the business.
- The position or the specialisation of the employee.
- The commencement date of the contract and its duration if it is for a fixed period.
- Notice periods.
- Annual leave entitlement.
- All the payments (salary, bonuses and so on) which the employee may be entitled to and the time schedule for their payment.
- The usual duration of daily or weekly employment.
- The application of any collective agreements.
Employment contracts can be written in any language that is understandable to both parties or, if the contract is written in a language that the employee does not understand, its provisions must be orally explained to the employee. However, it is advisable for the employer to obtain the confirmation of an independent professional (for example, a lawyer) that the terms of the contract have been appropriately explained to the employee.
# Minimum (Statutory) Employment Rules and Regulations in Cyprus
# Hours of work:
Generally, the number of working hours for a five-day week should not exceed 48 hours per week, including overtime.
According to the Hotel Employees (Conditions of Service) Regulations of 1972 to 2002 maximum daily working hours are 8 and these hours can be distributed in a period not exceeding 13 hours with no more than 2 interruptions (3 split shifts).
According to the Catering Employee’s (Conditions of Service) Law of 1968 to 2002 maximum daily working hours are 8 hours with no more than 1 interruption (2 split shifts).
# Probation period:
The default statutory probation period is 26 weeks, but it may be extended up to a maximum of 104 weeks with the consent of both parties. Throughout the duration of the probationary period the statutory provisions relating to notice and protection from termination of employment do not apply and the employee may be dismissed for any reason and without notice, save where more favourable provisions for the employee are stipulated within the contract of employment.
# Annual leave:
The Annual Holidays With Pay Law L.8/1967 provides that the minimum holiday entitlement per year is 20 working days for employees working ve days a week and 24 working days for employees working a six days a week, provided that the employee has already worked for at least 48 weeks within the year. An employee is not entitled to paid annual leave if he or she has worked for less than 13 weeks in the year. If the employee had worked for a period, more than 13 weeks the employee will be entitled to the pro-rata amount of holiday. The annual leave may be accumulated, for a period of two years, only if this is agreed between the employer and the employee. The above are only the statutory minimum and the parties are free to agree to more generous terms for the employee.
# Parental leave:
Apart from paid annual leave and sick leave, employees may also take maternity leave up to 18 continuous weeks. Female employees who are about to adopt a child under the age of 12 years are entitled to 16 continuous weeks starting immediately from the date on which they begin to have the care of the adopted child. In addition to maternity leave, for nine months after childbirth a female employee is entitled to start working one hour later or finish work one hour earlier for the purposes of breastfeeding or for the increased needs of child raising. In accordance with the law, that time must be considered and paid as normal working time. Employees of either gender who have completed six months or more of continuous employment with the same employer can claim unpaid parental leave for up to 18 weeks in total on the grounds of childbirth or adoption. Of course, provisions that are more favorable to the employee than the provisions of the Law may be applied through collective agreement or by agreement between the employer and the employee. The employee is entitled to seven days’ leave per year without pay on grounds of force majeure.
# Sick leave:
The number of unpaid sick leave is a contractual matter. If there is no different provision within the contract of employment, sick pay is paid by the Social Insurance Department for any period of three days or longer in which an employee is unable to work. The weekly entitlement is 60 per cent of the weekly average of basic insurable earnings within the previous year and is increased by one third for the employee’s dependent (including a spouse, whether or not in employment) and one-sixth for each child or other dependent. The maximum number of days for which sick pay is payable is 156 days in relation to every period of interrupted employment. This can be extended for a further period of 156 days during the same period of interrupted employment, provided that the insured is eligible to receive incapacity pension but is not expected to remain permanently incapacitated from working.
Overtime pay is generally not regulated by law in Cyprus and is usually a matter of agreement between employer and employees. However, in certain industries in which working time is regulated by specific legislation and regulations or any collective agreements, overtime payment may also be regulated accordingly.
# State minimum salary:
Cyprus has no general minimum wage requirement. However, a minimum wage rate or €870 per month is required for shop assistants, nurses’ assistants, clerks, hairdressers, and nursery assistants. The minimum wage rises to €924 after six months’ employment. Minimum wage for asylum seekers working as unskilled workers in the agricultural sector is €425 with accommodation and food provided. Skilled workers in the agricultural sector, the minimum wage is €767 without accommodation and food. Cyprus’ minimum wage was last changed in January 01, 2015.
# Employee dismissal:
Dismissals that cannot be justified under any one of the grounds below are considered unlawful per se:
- unsatisfactory performance (excluding temporary incapacitation owing to illness, injury and childbirth);
- force majeure, act of war, civil commotion, or act of God;
- termination at the end of a fixed period;
- conduct rendering the employee subject to summary dismissal; and
- conduct making it clear that the relationship between employer and employee cannot reasonably be expected to continue, commission of a serious disciplinary or criminal offence, indecent behavior, or repeated violation or ignorance of employment rules.
According to the provisions of the Termination of Employment Law L.24/1967, the statutory minimum notice which the employer has to give to the employee, varies according to the employee’s period of continuous employment as per the table below:
- More than 26 weeks, but less than 52 weeks – 1 week;
- More than 52 weeks, but less than 104 weeks – 2 weeks;
- More than 104 weeks, but less than 156 weeks – 4 weeks;
- More than 156 weeks, but less than 208 weeks – 5 weeks;
- More than 208 weeks, but less than 260 weeks – 6 weeks;
- More than 260 weeks, but less than 312 weeks – 7 weeks;
- 312 weeks or more – 8 weeks.
The notice period can be effectively extended by agreement but cannot in any event be less than the statutory minimum. Therefore, any provision in a contract providing for the reduction of the length of statutory notice period is void ab initio and not enforceable. No notification is required to be given to an employee during the probation period. The employer has the right to require the employee to accept payment in lieu of notice, which covers the employee’s salary entitlement, pro rata, for the period of the notice.