Employer of Record in Romania

An Employer of Record (EOR) in Romania legally employs your workers on your behalf. This means the EOR handles all local HR tasks, including payroll, taxes, benefits, and compliance with Romanian labor law. You manage your team's day-to-day work, while the EOR takes care of the employment paperwork and legal responsibilities. This arrangement allows you to hire talent in Romania without setting up a local entity. Providers like Rivermate offer EOR services to simplify your global expansion.

How an Employer of Record (EOR) Works in Romania

Using an EOR in Romania simplifies the process of hiring employees. Here is how it typically works:

1. You Find the Candidate. You recruit and select the talent you want to hire in Romania.
2. The EOR Hires Your Candidate. The EOR's local Romanian entity legally hires the employee under a compliant employment contract.
3. Onboarding Begins. The EOR manages the entire onboarding process. This includes collecting necessary documents and ensuring all legal requirements are met.
4. The EOR Manages HR. The EOR handles all payroll, tax withholdings, social security contributions, and benefits administration according to Romanian law.
5. You Manage Your Team. You direct your employee's daily tasks, projects, and performance, just like any other team member. The EOR remains the legal employer, while you focus on your business goals.

Why use an Employer of Record in Romania

An EOR offers a practical solution for companies looking to hire in Romania without the burden of establishing a legal entity. It saves you time and resources, allowing you to focus on growing your business and managing your team.

• Enter the Market Quickly. You can hire employees and start operations in Romania in a matter of days instead of the months it can take to set up a local company.
• Ensure Full Compliance. EORs are experts in Romanian labor law. They manage all legal and regulatory requirements, from employment contracts to termination procedures, reducing your risk of non-compliance. You can find official information on labor legislation from the Romanian Labour Inspectorate (https://www.inspectiamuncii.ro/legislatie).
• Simplify HR and Payroll. The EOR handles all administrative tasks. This includes processing salaries, managing tax deductions, and making social security contributions. The National Agency for Fiscal Administration of Romania (https://www.anaf.ro) provides official details on tax obligations.
• Offer Competitive Benefits. EORs can provide your employees with access to comprehensive benefits packages, which can be crucial for attracting and retaining top talent in the Romanian market.
• Save Money. You avoid the significant costs associated with establishing and maintaining a legal entity in Romania, including legal fees, accounting services, and administrative overhead.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Romania 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 Romania.

Hiring in Romania is a smart move for many companies. The country has a growing economy and a large pool of skilled workers, especially in tech and engineering. But, like any country, Romania has its own set of employment laws. Understanding these rules is key to hiring successfully. This guide breaks down what you need to know.

Employment contracts & must‑have clauses

In Romania, you must have a written employment contract, known as an Individual Labor Contract (CIM). You need to sign it before your new hire starts their first day. The contract must be in Romanian, but you can provide a bilingual version for clarity.

Here are the essential clauses your contract must include:

• Identification of both parties: This includes the legal name and address of your company and the employee's full name and address.
• Job title and description: Clearly state the employee's role and their main responsibilities.
• Place of work: Specify where the employee will work. If the role is remote or involves travel, describe this arrangement.
• Start date and duration: Note when the employment begins and whether the contract is for an indefinite or a fixed term.
• Salary and payment details: Include the base salary and how often the employee will be paid.
• Working hours: Define the daily and weekly work schedule.
• Annual leave: State the number of vacation days. The legal minimum is 20 working days per year.
• Notice period: Specify the required notice for resignation or dismissal.

You can also include other clauses, such as:

• Confidentiality: To protect your company's sensitive information.
• Non-compete: This can prevent an employee from working for a competitor for up to two years after they leave. You must pay them at least 50% of their average monthly salary during this non-compete period.

Probation periods

Probation periods in Romania let you and your new hire see if the job is a good fit. During this time, either of you can end the contract with a shorter notice period.

The maximum length of a probation period depends on the role:

For fixed-term contracts, the probation period is shorter and depends on the contract's length.

Working hours & overtime

The standard workweek in Romania is 40 hours, typically 8 hours a day, 5 days a week. The maximum legal working time, including overtime, cannot be more than 48 hours per week on average over a four-month period.

For any hours worked over the standard 40, you must compensate your employee in one of two ways:

• Paid time off: Provide paid time off within the next 90 days.
• Extra pay: If paid time off isn't possible, you must pay a bonus of at least 75% of their base salary for the overtime hours.

Public & regional holidays

Romania has several public holidays throughout the year. If your employees have to work on a public holiday, you must give them a paid day off within the next 30 days. If that's not possible, you must pay them at least 100% extra for the hours they worked.

Here are the public holidays for 2024:

• January 1 & 2: New Year's Day
• January 6: Epiphany
• January 7: St. John the Baptist
• January 24: Unification of the Romanian Principalities Day
• May 1: Labour Day
• May 3: Orthodox Good Friday
• May 5 & 6: Orthodox Easter
• June 1: Children's Day
• June 23 & 24: Pentecost
• August 15: Dormition of the Mother of God
• November 30: St. Andrew's Day
• December 1: National Day
• December 25 & 26: Christmas

Hiring contractors in Romania

Hiring independent contractors in Romania can give you access to a wider talent pool and more flexibility. Contractors work under a service agreement rather than an employment contract. They manage their own taxes and social security contributions.

However, it's crucial to classify workers correctly. If a relationship looks like employment, the authorities can reclassify your contractor as an employee. This is known as misclassification.

The Romanian Tax Code lists several criteria to determine if a worker is truly independent. A person is considered an independent contractor if they meet at least four of these conditions:

• They are free to choose their place of work and schedule.
• They are free to work for multiple clients.
• They assume the risks associated with their work.
• They use their own assets to perform the work.
• They rely on their own intellectual and/or physical abilities.
• They are part of a professional body that regulates their profession.
• They are free to work directly, with their own employees, or with other collaborators.

Misclassification can lead to serious penalties, including back taxes, social security payments, and fines.

An Employer of Record (EOR) can help you avoid these risks. An EOR legally employs workers on your behalf, taking care of all the legal and HR responsibilities. This includes running payroll, managing benefits, and ensuring compliance with local labor laws. Using an EOR makes it easy to hire in Romania without setting up a local entity and reduces the risk of misclassifying your workers.

In Romania, your payroll responsibilities are guided by the Labour Code and tax laws. These regulations define employee rights and how you handle compensation. Key elements include the gross salary, income tax, and mandatory social security and health insurance contributions, which you must calculate and deduct correctly. You are required to process payments to employees at least once a month and keep precise payroll records.

Payroll cycles & wage structure

In Romania, you should pay employees monthly. While some companies might opt for bi-weekly or weekly payments, the standard payroll system is built around a monthly schedule. You can choose the specific payday, but you must ensure salaries are consistently paid on that date. All payments to employees must be made in the local currency, the Romanian Leu (RON).

Overtime & minimums

The standard full-time work week in Romania is 40 hours, typically spread over five days. Any work that goes beyond 8 hours a day or 40 hours a week is considered overtime. You must compensate overtime with a premium of at least 75% above the employee's regular rate. Alternatively, you can provide paid time off within 60 days of the overtime work.

As of July 1, 2024, the gross minimum wage is 3,700 RON per month. The government periodically reviews and adjusts this rate based on factors like inflation and economic growth.

Employer taxes and contributions

As an employer, you are responsible for paying a work insurance contribution. For employees working in specific conditions, you may also need to pay an additional pension contribution.

Employee taxes and deductions

You must withhold taxes and social contributions from your employees' gross salaries. These deductions are then remitted to the state budget.

In Romania, you'll find that employee benefits and leave are a mix of what's required by law and what companies offer to stay competitive. The system is designed to protect employees, providing a solid foundation of rights and social protections. This ensures everyone has access to things like paid time off and healthcare.

Statutory leave

The Romanian government mandates several types of paid leave to support employees.

• Annual Leave: You are entitled to a minimum of 20 paid vacation days per year. This can be increased through your employment contract.
• Sick Leave: If you get sick, you are entitled to up to 183 days of sick leave per year. Your employer pays for the first 5 days, and the national health insurance fund covers the rest. The pay is typically 75% to 100% of your salary, depending on the illness.
• Maternity Leave: Mothers get 126 days of maternity leave. This can start before the due date and must continue for at least 42 days after childbirth.
• Paternity Leave: Fathers are entitled to paid paternity leave.
• Parental Leave: After maternity leave, one parent can take parental leave to care for the child.

Public holidays & regional holidays

Romania has a number of national public holidays. If you work on these days, you are entitled to extra pay.

Typical supplemental benefits

To attract and keep good employees, many companies in Romania offer more than the legal minimum.

How an EOR can help with setting up benefits

Setting up a competitive benefits package in a new country can be complex. An Employer of Record (EOR) simplifies this process for you.

An EOR already understands the local laws and employee expectations in Romania. They can ensure you offer a benefits package that is both compliant and attractive to local talent. This means you don't have to become an expert in Romanian labor law.

An EOR handles all the administration. This includes everything from enrolling employees in health insurance to managing payroll deductions for benefits. This frees you up to focus on growing your business. They can also often provide access to better benefits at a lower cost due to their existing relationships with local providers.

Letting an employee go is a sensitive process, and in Romania, it's important to follow the correct procedures. The Romanian Labour Code has specific rules to ensure fairness for both employers and employees. Understanding these rules helps you manage departures smoothly and compliantly. This guide breaks down the key aspects of termination and offboarding in Romania.

Notice periods

When you terminate an employment contract in Romania, you must provide a notice period. This is the time between notifying an employee of their dismissal and their last day of work. The minimum notice period is 20 working days for most employees. For employees in management positions, the minimum notice period is 45 working days.

Here's a simple breakdown of the minimum notice periods:

The notice period begins the day after the employee receives the written termination notice. During this time, the employee is expected to continue their regular duties.

Severance pay

Severance pay is not always required in Romania. The law mainly requires severance pay in cases of collective redundancies. It may also be required if an employee is terminated due to physical or mental incapacity and cannot be moved to another suitable position.

In many other situations, like termination for disciplinary reasons, severance pay is not a legal requirement. However, an employment contract or a collective bargaining agreement might include provisions for severance pay.

How Rivermate handles compliant exits

When you partner with Rivermate, we manage the entire offboarding process to ensure it's compliant with Romanian law. We take on the legal and administrative tasks so you can focus on your business.

Here’s how we handle compliant exits:

• Documentation: We draft the necessary written termination decision. This document clearly states the legal reasons for the termination and the effective date.
• Formal Notice: We ensure the termination notice is delivered to the employee correctly. This can be in person with a signature or through registered mail.
• Notice Period Management: We manage the statutory notice period to ensure it is correctly applied.
• Final Payments: We calculate and process all final payments, including any unused vacation days.
• Compliance: We make sure every step of the process follows the Romanian Labour Code. This helps you avoid legal issues and potential disputes.

Navigating the visa and work permit process in Romania requires a clear understanding of the requirements for non-EU/EEA nationals. If you are not a citizen of an EU or EEA country, you will need a work permit and a long-stay visa to be employed in Romania. Your employer is responsible for obtaining the work permit on your behalf from the General Inspectorate for Immigration. Once the work permit is secured, you can then apply for a long-stay visa at a Romanian embassy or consulate in your country of residence.

Employment visas & sponsorship realities

An Employer of Record (EOR) can sponsor work permits for foreign employees, but they must be registered with the Romanian Immigration Office. The EOR acts as the legal employer and handles the application process.

Here are some practical points to consider:

• Sponsorship eligibility: EOR sponsorship is typically for full-time employees. Independent contractors and freelancers are generally not eligible for this type of visa and may need to explore self-employment registration options.
• Location-specific permits: Work permits are tied to a specific job and location. If an employee changes their job or work location, a new permit may be required.
• Annual quotas: Romania has a limit on the number of work permits issued to foreign workers each year. In 2025, the quota was set at 140,000.

A significant challenge has recently emerged. In April 2025, the Romanian Immigration Department suspended all online appointments for work permits until October 2025. This was due to fraudulent activity detected in the online system. This suspension affects all non-EU/EEA nationals and is likely to cause significant delays in hiring and onboarding.

It's important to note that the current suspension of work permit appointments will impact these timelines.

Business travel compliance

For short-term business visits, you will generally need a short-stay visa (Type C). This visa allows you to stay in Romania for a maximum of 90 days within a 180-day period. It is important to understand that a short-stay business visa does not give you the right to work in Romania.

Activities permitted on a business visa include:

• Attending meetings and conferences
• Negotiating contracts
• Training for employees of a Romanian company

To apply for a business visa, you will typically need:

• A valid passport
• An invitation letter from the Romanian company you are visiting
• Proof of accommodation
• Proof of sufficient financial means
• Travel health insurance