Employer of Record in Cyprus
Skuad’s Cyprus Employer of Record (EOR) solution helps your business expand without the need for an entity setup. Our unified and automated global human resource (HR) platform enables you to expedite the onboarding of your remote team, manage their payroll, benefits, taxation, probation, and termination in compliance with the local laws. In addition, we help you streamline the global expansion process with the able assistance of our international network of experts from over 150 countries. Book a demo with Skuad to kick-start your expansion into Cyprus
Cyprus at a Glance
Employment in Cyprus: 1,215,630 (World Population Review 2021)
Currency: Euro (EUR)
Languages: Greek and Turkish
Gross Domestic Product (GDP): USD 23.97 billion (as per 2020); it is expected to increase to USD 26.48 billion in 2021.
Learn more about employment in Cyprus and business expansion by partnering with Skuad.
Employment in Cyprus
What You Should Know Before Employing in Cyprus
The employment laws in Cyprus are drafted and enforced by the Department of Labor under the Ministry of Labor and Social Insurance. The main legislations are available on the Web Portal of the Republic of Cyprus. The key entitlements are tabulated below.
To know more about the employment laws and policies in Cyprus, talk to Skuad experts.
Contractors vs. Full-time Employees
The employment contracts in Cyprus are either for an indefinite period or for a fixed time. The two types of employment contracts depend on the type of the job or project.
The fixed-time contract is valid for 30 months, and upon expiry of the contract or if the job continues beyond that, it is converted into an indefinite contract. An indefinite contract only expires in one of the following circumstances.
- Upon resignation
- Upon termination by mutual consent or in response to a major violation of the terms of the contract
- Upon the death of the employee
Advantages of Hiring Contractors
- Flexibility: Since contractors are hired on a short-term basis, you are free to determine the scope of their work temporarily. If new needs arise, new contracts can be drafted in the short term.
- Independence: Short-term contractors usually work independently. They do not require close supervision; hence, your resources can be transferred elsewhere, as needed.
- Cost: Hiring contractors may be cheaper in the long run, although their individual rates are higher than those of full-time employees. This is because such employees are not entitled to employment benefits such as bonuses and tax compensations.
Advantages of Hiring Full-time Employees
- Loyalty and organizational commitment: Full-time employees are likely to be more loyal, as they exclusively work for your company. Since their individual success depends on the performance of your firm, they are likely to invest more effort into their work.
- Knowledge: All employees undergo training when they join a firm. The skills and knowledge gained by a full-time employee, however, stay within the organization.
- Legal freedom: Since full-time employees are defined as such in their contracts from the outset, misclassifications can be avoided completely. When hiring full-time employees, you determine the terms of the contract and entitlements, and these are not liable to change unless mutually decided by both parties.
The employment agreement in Cyprus is based on the job requirement. Contractors work on a project basis and get paid based on the project. Full-time employees are paid every month and do not work on a project basis. Learn more by getting in touch with Skuad experts.
Hiring in Cyprus
The most common hiring and recruitment processes in Cyprus are through job advertisements in local newspapers or online job portals or boards. The application rate by candidates increases when there is complete information provided by the employer for the wage, job role and responsibilities, and job title. The common job portals in Cyprus are,
The recruitment of the right candidate by the company requires a strategic approach. The job postings made by hiring companies in Cyprus must be legally compliant. The employment contract should be in the local language. It must spell out all the employment terms. The offer letter and contract in Cyprus should state the salary and monetary compensation in EUR.
The Cyprus Compliance Laws vary based on the nationality of the employee. The foreign employees are recruited in compliance with the Alien and Migration Law. The Law on Free Movement and Residence of Nationals of the Member States of the European Union is applied for hiring employees from the Europeanfrom European Union. The citizens of Cyprus are hired under compliance of the Department of Labor and the Civil Registry and Migration Department. According to Article 28 (2) of the Constitution of Cyprus, equal treatment should be provided for both foreign workers and locals.
Skuad helps with the recruitment and onboarding process and all the necessary formalities. To know more about hiring in Cyprus, talk to Skuad experts now.
Probation & Termination
The standard probation period in Cyprus is up to six months but it can be extended for up to two years through a written agreement between the employer and employee. The employee’s performance is checked during the probation period before they are provided a full-time employment position.
The termination of employment in Cyprus is governed by the Termination of Employment Law enacted on May 27, 1967. The law protects the rights of employees and prevents unlawful termination. The employers intending to terminate employment are obliged to give a notice period in advance, which varies depending on the length of the service.
The employer is not obliged to give a notice period for terminating an employee on probation for up to 104 weeks. In case an employee is absent from work for a period of up to six months, an employer cannot serve them their notice. In such cases, the employee is suspended. An employer can terminate an employee without notice on grounds including,
- A serious offense committed by the employee in course of duty
- Criminal offense without agreement or consent by the employer
- Inappropriate behavior during duty
- Repeated violation of work regulations or rules during employment
In case of termination, some employers are obliged to pay severance or compensation but it varies from industry to industry and period of employment. An employee is entitled to compensation in case of termination due to employer behavior against him. When the employee is employed continuously beyond 104 weeks, they are entitled to a redundancy payment from the Redundancy Fund.
To ensure your expansion endeavors are in compliance with the Cyprus employment laws, Contact Skuad today.
Expert guidance and step-by-step assistance are crucial for establishing an enterprise or company and for foreign recruitment in Cyprus. Every country has its compliance policies and different employment and labor laws.
Skuad has a high-tech, unified HR platform for businesses to manage and pay their remote teams. Some of Skuad’s primary functions are,
- Talent discovery: We discover exceptional talent and skill to onboard the employees for the companies.
- Updated EOR: The tech-enriched HR platform enables seamless and easy control over the hiring procedure, including onboarding, paying, and managing the hiring process.
- Local compliance: Not limited to the hiring process only, we release you from the hassle of complying with the local laws to create entities and manage tax.
- Conducting formalities: We help in creating a suitable employment contract, following all the legal provisions of the land, and ensuring an easy collection of documents for taxation.
Skuad offers an EOR solution for Cyprus to simplify the process of hiring, payroll, and global business expansion. The local partners provide extensive information about the HR policies and employment laws of the country. To avail of our services, book a demo today.
Types of Visas in Cyprus
There are two types of visas in Cyprus.
- Short-stay visas are valid for up to 90 days. They are issued to tourists for multiple entries into the country across 180 days.
- Long-stay visas are valid for longer than 90 days. These can be student visas or work visas.
A work visa is mandatory for foreign employees to legally work in Cyprus. The work visa must follow the labor laws of the country. There are different types of work visas depending on the employment type and duration. The mandatory documents required by an employee to work in Cyprus based company or organization include,
- Work visa, which allows employees to work legally in the work
- Cyprus work permit that offers authorization to the employee to work in Cyprus
- Residence visa, which is for foreigners planning to live in Cyprus beyond 90 days
To know more in detail about Cyprus work visa requirements and the application process, talk to Skuad experts.
In Cyprus, work permits for foreigners are mandatory for paid employment. An employee can get a work permit only when,
- It is applied for by the employer on behalf of the employee
- The employer can prove that the paid position cannot be filled by a Cyprus citizen or citizens from European Union/European Free Trade Association countries
The process of obtaining a work permit in Cyprus involves approval from the Cyprus Department of Labor. The application must be submitted to the Civil Registry and Migration Department. Here are the job positions eligible to get a work permit in Cyprus.
- Executive director with an annual salary starting from EUR 41,000
- Middle management employee with an annual salary between EUR 21,000 and EUR 40,000
- Supporting staff with varied salary slabs
Foreign employees can apply for a Cyprus work permit without a job offer but it is done personally without the involvement of the company.
- Application form signed and signed by the employer
- Passport photocopies
- Original employer contract
- Certificate of police clearance and medical clearance
- Tax clearance certificate of the hiring company
Learn more about work permits in Cyprus with Skuad’s global EOR solutions.
Payroll & Taxes in Cyprus
Payroll in Cyprus
The Cyprus employer payroll taxes follow the PAYE (Pay as You Earn) system; hence, 0.35% of the employees’ gross salary is withheld in form of income tax. Here are the options for setting up payroll in Cyprus.
- Internal: This requires an internal staff for the management of the payroll and calculation of taxes and is most feasible for large companies.
- Remote: This system involves the addition of the employees in Cyprus to the payroll of the parent company located in another country. However, the regulations and rules might vary, despite one-stop payroll management.
- Payroll processing company in Cyprus: The process of payroll can be outsourced to other payroll processing companies. However, an awareness of the HR compliance laws of the country is crucial.
- Payroll outsourcing in Cyprus: Global EOR companies such as Skuad provide the payroll while complying with all laws. Talk to us to know more about payroll in Cyprus.
Taxes in Cyprus
To understand how payroll and taxes are managed in Cyprus and expedite your expansion process, talk to Skuad experts and book a demo.
Incorporation: How to Set Up a Subsidiary in Cyprus
Setting up a subsidiary will help in the legal expansion of business in Cyprus. However, there are multiple factors associated with the expansion of business. Here are the steps for setting up a subsidiary in Cyprus.
- The first step is the employer must choose the type of business and appropriate location for setting up the business as per the local laws and compliance.
- The second step is incorporating a holding company in Cyprus, which requires a few tasks, such as,
- Have the company name approved
- Prepare the memorandum and articles of association
- Submit the necessary documents to the companies sector of THE Department of Registrar of Companies and Official Receiver
- Register your subsidiary with the Inland Revenue Department
- Apply for a Tax Identification Number and VAT
According to the Cyprus subsidiary laws, the company incorporation can either be a limited liability company (LLC) or a public limited company (PLC).
Setting up an entity and creating your legal presence can be a complicated process in a foreign country. Skuad’s Cyprus EOR solution offers a team of expert lawyers, accountants, and consultants who can help with the incorporation process. Book a demo to know more.
Professional Employer Organization (PEO)
A professional employer organization (PEO) in Cyprus helps with the comprehensive management of HR-related matters in compliance with the local laws. Many global companies take the help of PEOs to expand their businesses. A PEO takes care of HR tasks such as hiring, onboarding, payroll, taxation, probation, termination, employment contracts, and visas.
You must remember that your company will be held liable for the penalties imposed on any unwarranted employment-related actions executed by the PEO. On the other hand, an EOR service takes care of all compliance-related liabilities. This means that your company is not held responsible for the contravention of local laws.
Partnering with a PEO works well if you already have a legal entity in a foreign country. However, an EOR service does not require an entity establishment; it can take care of incorporation for you.
Skuad's EOR solution is a good way to expand your business in Cyprus without setting up a separate entity. Our solutions help you to stay focused on your business and leave all business compliances, payroll processing and complete management work to us. Connect with Skuad to know more.
Conclusion: What Gives Skuad’s Cyprus Solutions an Edge?
Expanding your business globally is challenging. Skuad can help you by providing a well-established global HR platform to manage the entire employment life-cycle without setting up a legal entity in Cyprus.
Skuad has an extensive network in 150+ countries across the globe and provides a single interface to onboard and manage employees and contractors. It offers consistent prices, irrespective of the location, and manages the payment of your team through a single invoice.
Expand your business into Cyprus, recruit employees globally, and streamline HR-related tasks with help of Skuad’s efficient EOR solution. Skuad understands and follows the labor laws of Cyprus for the effective establishment of businesses. Talk to Skuad experts and get started with business expansion, recruitment, and HR management.