Employer of Record in Cyprus

An Employer of Record (EOR) in Cyprus legally employs your team on your behalf. This means we handle all the local HR tasks, like payroll, taxes, benefits, and compliance with Cypriot labor law. You get to manage your team's day-to-day work, while we take care of the employment paperwork. This lets you hire in Cyprus without setting up a local entity. Rivermate can act as your EOR in Cyprus.

How an Employer of Record (EOR) Works in Cyprus

Using an EOR in Cyprus simplifies your expansion. We take on the legal responsibilities of an employer. Here is how it works:

1. You Find the Talent: You recruit and select the best person for the job in Cyprus.
2. We Hire Them: We legally hire the employee through our local Cypriot entity. The employment contract complies with all local labor laws, including regulations set by the Ministry of Labour and Social Insurance (http://www.mlsi.gov.cy/mlsi/dl/dl.nsf/index_en/index_en?OpenDocument).
3. Onboarding Starts: We manage the entire onboarding process. This includes everything from collecting necessary documents to enrolling the employee in mandatory social security.
4. We Handle HR: We process payroll, deduct taxes, and make social security contributions as required by the Tax Department (https://www.mof.gov.cy/mof/tax/taxdep.nsf/index_en/index_en?opendocument). We also administer all statutory benefits.
5. You Manage Your Team: You direct their daily tasks and projects. They are your team members in every way that matters for your business operations.
6. Ongoing Compliance: We stay up-to-date with any changes in Cypriot employment law to ensure you remain compliant.

Why use an Employer of Record in Cyprus

An EOR helps you hire in Cyprus quickly and safely. It removes the need to open your own legal entity, which saves you time and money. This lets you enter the Cypriot market and hire talent much faster.

Here are some key benefits:

• Avoids Local Entity Setup: You can hire employees in Cyprus without the cost and complexity of establishing a legal entity.
• Ensures Legal Compliance: We navigate Cyprus's specific labor laws and regulations for you. This minimizes your risk of non-compliance.
• Simplifies Payroll and Taxes: We manage all aspects of payroll, including income tax, social security contributions, and other local deductions.
• Manages Employee Benefits: We administer all mandatory and supplementary benefits for your employees, making your offer competitive.
• Reduces Administrative Burden: You can focus on your core business activities while we handle the HR and administrative tasks of employment.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Cyprus includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in Cyprus.

Hiring in Cyprus offers a strategic advantage for businesses looking to expand. The island nation boasts a skilled workforce and a business-friendly environment. Key sectors include tourism, finance, and information technology. While English is widely spoken, some knowledge of Greek can be beneficial.

Employment contracts & must-have clauses

When you hire an employee in Cyprus, you must provide them with a written statement of their employment terms within one month of their start date. While a full contract is standard practice, this written statement is the minimum requirement.

Your employment contracts must include the following information:

• Identities of the employer and employee
• Place of work
• Job title or a description of the work
• Start date of the employment
• For fixed-term contracts, the expected duration
• Salary and payment frequency
• Working hours
• Paid leave entitlement
• Notice periods for termination

You can also include other clauses, such as:

• Confidentiality: To protect sensitive business information.
• Non-compete: These are enforceable if they are reasonable in scope and duration.
• Intellectual Property: To clarify ownership of work created during employment.

Probation periods

For new hires, you can set a probationary period to assess their suitability for the role.

• The maximum probation period is six months.
• For fixed-term contracts, the probation period must be proportional to the contract's length.
• During probation, either you or the employee can terminate the contract with a shorter notice period, which is often one week.

Working hours & overtime

Standard working hours in Cyprus are typically 40 hours per week, spread over five or six days.

Overtime is any work performed beyond the standard hours. Compensation for overtime is usually governed by collective agreements or the employment contract.

Public & regional holidays

Employees in Cyprus are entitled to paid time off for public holidays. Here are the public holidays for 2025:

• January 1: New Year's Day
• January 6: Epiphany
• March 3: Green Monday
• March 25: Greek Independence Day
• April 1: Cyprus National Day
• April 18: Good Friday (Orthodox)
• April 20: Easter Sunday (Orthodox)
• April 21: Easter Monday (Orthodox)
• May 1: Labour Day
• June 9: Pentecost Monday (Kataklysmos)
• August 15: Assumption of the Virgin Mary
• October 1: Cyprus Independence Day
• October 28: Greek National Day (Ochi Day)
• December 25: Christmas Day
• December 26: Boxing Day

Hiring contractors in Cyprus

You can also hire independent contractors for specific projects or specialized skills. This offers flexibility and can be cost-effective.

An independent contractor is self-employed and responsible for their own taxes and social security contributions. The relationship is governed by a service agreement, not an employment contract.

A key challenge is misclassification. If a contractor is deemed to be an employee in practice, you could face significant penalties. This includes back payments for taxes, social security, and employee benefits.

An Employer of Record (EOR) can help you mitigate this risk. An EOR acts as the legal employer for your workers in Cyprus. They handle all local employment laws, payroll, taxes, and benefits. This ensures you stay compliant while you focus on managing your team's day-to-day work.

Navigating compensation and payroll in Cyprus is straightforward. The system is built on clear rules for both you and your employees. You'll find a mix of employer and employee contributions that fund social insurance and healthcare. The process is generally monthly, and the tax system is progressive. This guide breaks down what you need to know.

Payroll cycles & wage structure

In Cyprus, you can pay your employees weekly, bi-weekly, or monthly, but monthly payments are the most common. You must provide a payslip with each payment, which can be a digital or paper copy. This payslip needs to show the gross wage, all deductions, and the final net pay.

While not required by law, a 13th-month salary is a common practice and is typically paid in December.

Overtime & minimums

There isn't a universal law for overtime pay that applies to all industries. Instead, overtime rates are usually set by collective agreements or individual employment contracts.

Cyprus has a national minimum wage. For full-time employees, this is set at EUR 1,000 per month.

Employer taxes and contributions

As an employer in Cyprus, you contribute to several funds on behalf of your employees. These payments support social insurance, healthcare, and other benefits.

Employee taxes and deductions

Employees also contribute to social funds, and their income is taxed progressively. You will withhold these amounts from your employees' paychecks.

Here are the employee contributions:

And here are the income tax rates:

In Cyprus, your employee benefits and leave are a mix of what the law requires and what companies offer to attract top talent. The system is designed to provide a strong social safety net. This includes paid time off, healthcare, and support for families. Think of it as a foundation of mandatory benefits that you can build on.

Statutory leave

The law in Cyprus sets the minimum leave you must provide.

• Annual Leave: If your employees work a five-day week, they get at least 20 days of paid leave per year. For a six-day work week, it's 24 days.
• Sick Leave: The Social Insurance Fund pays for sick leave.
• Maternity Leave: New mothers get 18 weeks of paid maternity leave. This is paid by the Social Insurance Fund.
• Paternity Leave: New fathers can take two consecutive weeks of paid paternity leave.
• Parental Leave: Both parents are entitled to unpaid parental leave.

Public holidays & regional holidays

In Cyprus, employees get paid time off for public holidays. If they have to work on a public holiday, you must pay them double their normal rate.

Typical supplemental benefits

Many companies in Cyprus offer extra benefits to stay competitive. Here’s a look at what's required by law versus what you can offer on top.

How an EOR can help with setting up benefits

An Employer of Record (EOR) makes it easy to offer competitive benefits in Cyprus. An EOR acts as the legal employer for your team in Cyprus.

Here's how an EOR can help:

• Compliance: An EOR ensures you comply with all local labor laws regarding benefits and leave.
• Administration: They handle the paperwork and administration of both statutory and supplemental benefits.
• Expertise: You get access to local experts who understand the Cypriot benefits landscape.
• Speed: An EOR helps you get your team set up with benefits quickly, without needing to establish a legal entity in the country.

Using an EOR simplifies the process. You can focus on your business while the EOR takes care of the complexities of managing employee benefits.

When an employment relationship ends in Cyprus, you need to follow a clear legal process. The Termination of Employment Law governs how to handle dismissals, resignations, and redundancies. This ensures a fair process for both you and your employee. You must provide a valid reason for termination, give proper notice, and make all final payments correctly. Failing to follow these rules can lead to legal disputes.

Notice periods

You must give employees written notice before termination. The minimum notice period depends on how long the employee has worked for you.

An employment contract can require a longer notice period, but not a shorter one. You can also choose to pay an employee their salary for the notice period instead of having them work. In cases of serious misconduct, you can dismiss an employee without notice.

Severance pay

Employees are entitled to severance pay if they have worked for you for at least 104 weeks and are terminated for redundancy. Redundancy can happen for several reasons, such as business closure or restructuring.

The amount of severance pay is based on the employee's length of service and is paid from the government's Redundancy Fund.

How Rivermate handles compliant exits

Navigating employee terminations in Cyprus can be complex. We make sure every step is compliant with local laws.

Here is how we handle the process:

• Documentation: We prepare and manage all necessary termination documents.
• Calculations: We calculate final pay, including any outstanding salary, unused vacation, and severance pay.
• Communication: We help you communicate clearly with your employee to ensure a smooth process.
• Compliance: We make sure you meet all legal requirements to avoid any legal risks.

We handle the details so you can focus on your business.

Navigating the visa and work permit process in Cyprus is straightforward when you understand the requirements. For non-EU nationals, securing the right to work involves a joint effort between you and your employer. Your employer, or an Employer of Record (EOR), will handle the work permit application on your behalf. Once you have a work permit, you can then apply for the necessary visa to enter and reside in the country.

Employment visas & sponsorship realities

An Employer of Record (EOR) can be your legal employer in Cyprus, handling all the necessary legal and HR requirements, including visa sponsorship. To sponsor your work permit, the EOR must be a legally registered entity in Cyprus. They will manage the entire application process, from gathering the correct documents to getting the final approvals.

Here are the practical routes for employment:

• EOR Sponsorship: This is a common path for companies that don't have a legal entity in Cyprus. The EOR hires you on behalf of their client company, making them your legal employer and sponsoring your work permit.
• Direct Employer Sponsorship: If your employer has a registered office in Cyprus, they can sponsor your work permit directly. The process is similar to working with an EOR.
• Digital Nomad Visa: If you work remotely for a company outside of Cyprus, you may be eligible for a Digital Nomad Visa. This visa allows you to live in Cyprus while working for a foreign employer.

It is important to know that an EOR's ability to sponsor visas may be subject to national quotas.

Business travel compliance

For short-term business visits, you will likely need a Short Stay Visa (Category C). This visa allows you to stay in Cyprus for up to 90 days. If you travel to Cyprus for business frequently, you may be able to obtain a multiple-entry visa, which is valid for up to five years and permits stays of up to three months within any six-month period.

To ensure compliance, you need to have the correct visa for the activities you plan to undertake. Working in Cyprus, even for a short period, requires a work permit. The short-stay visa is intended for business meetings, negotiations, and other non-work activities.