Introduction to Payroll in Greece
Ancient history, modern cities, and an excellent geographic position for trade in Europe and abroad: Greece is all this, and much more. Unsurprisingly, more and more foreign businesses are looking at this country when planning their international expansion.
While growing your company in Greece can certainly be a great and profitable choice, it’s important to note that it comes with some complexities. Setting up payroll in Greece, for example, is one of the main hurdles for foreign investors.
As we will explain in detail throughout this guide, processing and managing your Greek payroll internally can be complex, expensive, and time-consuming. On the other hand, joining forces with a global payroll provider like Skuad can help take the guesswork out of all things payroll.
Payroll Process in Greece
The first complexity is about the very structure of the process. Payroll, in fact, is a three-part procedure that includes pre-payroll, payroll calculation, and post-payroll. Below we will examine all these stages.
In this phase, you are going to set up your business in Greece, while at the same time researching the country’s national and local legal requirements, and gathering and validating payroll input.
Setting up the organization
First of all, you are going to need to set up your business entity in Greece. This is the first, essential step that allows you to operate a legally compliant payroll.
Now, you’ll need to register your company as a legal entity. By doing so, you will be provided with a unique reference number that will identify your business on all the official forms and paperwork.
Operating your business in a city like Athens might require you to follow different labor and employment rules than in, let us say, one of the Greek islands. Be sure to check local requirements, and always operate in compliance with the relevant rules and regulations.
You will need to establish all the different types of leave that you are going to offer your employees, including sick leave, parental leave, and annual leave. It’s also essential that you communicate these policies clearly and in a timely manner, to your workforce.
Defining, communicating, and observing policies around work attendance is another crucial aspect of pre-payroll, as it will determine the final salary calculation.
All the policies listed so far are, largely defined and officialized internally. However, they still must comply with Greek payroll laws, if you want your business to operate legally.
Typically, salaries in Greece include deductions and allowances. Remember to consider all of these when calculating the final amounts.
In Greece, employees are usually paid once a month. However, it’s up to your company to select its payday and maintain a transparent payment schedule.
Information on employees needs to be collected in order to finalize payroll.
Payroll calculation phase
Once you have completed the pre-payroll phase, you can proceed with payroll calculation. If you are working with an automated system, then all the information collected in the pre-payroll phase will now be fed into your payroll system, which in turn generates individual salaries quickly, accurately, and reliably.
The core of the post-payroll phase is salary payments. This can be either done manually by liaising with your bank, or automatically, via payment software.
Monitoring your salary payments every month is paramount to your internal accounting system.
Payroll reporting and compliance
Ensuring that you liaise with local and federal Greek authorities on aspects such as taxes, invoices, and payments keeps your business legal and compliant.
Does the prospect of handling all this by yourself make you feel overwhelmed? You don’t need to do everything alone — team up with an experienced payroll provider like Skuad, and turn payroll in Greece into child’s play.
Payroll Processing in Greece
In Greece, employers must be aware of all the different types of taxes, tax brackets, tax authorities, and tax deadlines. This can become complicated very quickly, and might generate delays, mistakes, and even fines.
Payroll Processing Company in Greece
At Skuad, we are passionate about making payroll processing in Greece — and anywhere else in the world — a breeze. Our knowledgeable, professional, and friendly team of payroll advisors will take care of your payroll needs throughout the entire process, and beyond.
Payroll Management in Greece
Payroll management involves recording all your employees’ financial data and always remaining fully compliant with the country’s rules and regulations.
Payroll Compliance in Greece
In Greece, statutory compliance with payroll means following the specific labor and employment laws that are established by the Greek Constitution, the Greek Civil Code, case law, and other ministerial laws and decisions.
Payroll Components in Greece
In the next sections, we will discuss the main components of payroll in Greece. These elements are all essential in allowing you to calculate your employees’ salaries every month.
As of January 1, 2022, the minimum wage in Greece was increased to €29.62 per hour and €663.00 per month.
Typical working hours in Greece are 40 per week, over five days. It’s also worth mentioning that, effective January 1, 2022, employees’ work attendance and timings are recorded on a Digital Work Card, a real-time device that enables both employers and authorities to verify that employees adhere to the country’s laws around working time.
Recently, overtime work has increased from 120 to 150 hours per year. These hours are capped.
Employers in Greece are required to contribute part of their workforce’s salaries to social security authorities. These include pension funds, health care, supplementary insurance, unemployment, professional risk, and high occupational risk.
In Greece, employees are required to show a signed medical certificate within 48 hours of requesting a sick leave allowance. Once the employer has viewed and accepted the certificate, employees are entitled to different amounts of sick days depending on the number of years that they have worked at the company.
For example, employees who have worked for the same employer for one to four years can request up to one month of sick leave. Those who have worked there for four and ten years, can access three months of sick leave.
These are the main public holidays in Greece:
- January 1
- The feast of the Epiphanies: January 6
- March 25
- Easter Monday
- May 1
- The feast of the Assumption of the Virgin Mary: August 15
- October 28
- The Feast of the Nativity of Christ: December 25
- December 26
All employers in Greece are required by law to pay a range of taxes, including social security, sales tax, and corporate income tax.
Termination of Employment
No notice is mandatory when an employer decides to terminate an employee. It is at the discretion of the individual employer.
Paid Annual Leave
Once an employee has worked for the same employer for at least 12 months, they are entitled to access vacation leave. Full-time workers can request up to 20 days of annual leave, whereas those who work six days a week can receive 24.
For every year spent with the same company, employees earn one extra day of vacation leave, capped at 22 days for employees on a five-day schedule, or 26 days for those on a six-day schedule.
If all this information is making you feel dizzy already, then don’t panic: Skuad is here to support you, every step of the way.
One of the most challenging aspects of expanding your business to Greece is managing payroll. So, after all that we have discussed, you might be wondering what your different options are in terms of payroll management.
You could try and manage everything internally. This, though, will end up costing you a lot of money, time, and effort, as you will need to hire (and pay) specialized HR and accounting teams.
Or, you might opt for remote payroll. This approach lets you do everything from your parent company, and while cheaper, it can also become incredibly complicated as it requires a strong knowledge of the country’s labor and employment laws.
As an alternative to these two methods, you could choose to hire a payroll processing company in Greece. This, though, is much easier said than done: finding the right agency is no mean feat.
Outsourced payroll, finally, is the best and most complete option of all. With this approach, a global payroll provider, like Skuad, handles all aspects of your payroll in Greece on your behalf. The bottom line? You have the peace of mind that every detail is taken care of in the most efficient and trustworthy way, and you can get back to focusing on activities that add real value to your business.
Are you curious to find out how we do all this for you? Take a peek at our FREE demo, or get in touch with our team today.
As of May 22, 2022, the U.S. dollar is equivalent to .95 Euros, the currency in use in Greece and throughout the European Union.