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Cyprus has a substantial proportion of the local population possessing tertiary qualifications. Businesses can confidently tap into a vast and highly educated workforce, particularly given that approximately 80% of the population in Cyprus is proficient in the English language.
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Cyprus has made efforts to create a business-friendly environment with competitive tax rates, a strong legal framework, and various incentives for foreign investors and companies. The country also has a well-developed financial sector. This is including a robust banking system and a growing fintech industry, which can be advantageous for companies with financial needs.
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The established National Minimum Wage in Cyprus stands at 940 EUR monthly, however during the initial 6 months of employment, it’s lowered to 885 EUR per month.
Standard Working Hours
The typical workweek consists a maximum of 44 hours spread over five days, though it is also possible to have a 6-day workweek. However, employers must obtain written consent from employees before extending their working hours beyond the standard limit. The standard working week is Monday – Friday.
Any work beyond the regular weekly working hours is considered overtime and is governed by the employment contract or collective bargaining agreements.
The maximum weekly hours amount to 48 hours, averaged over a period of 4 months. Additionally, any hours exceeding the 40-hour weekly threshold are compensated at an overtime rate, a figure established in the employment contract or collective bargaining accords.
The payroll cycle in Cyprus is generally monthly, and payments are to be made no later than the last working day of the month. Although not obligatory, it is customary to provide employees with a 13th salary in December.
Paid time off
The amount of paid annual leave an employee is entitled to depends on their length of service. For those who work a 5-day week, the standard annual leave entitlement is 20 days per year. However, employees working a six-day week enjoy a slightly longer entitlement of 24 days per year.
Additional leave entitlements are specified in the employment contract or collective agreement. Employer holds the discretion to approve or reject leave requests based on business demands.
In Italy, sick pay and time off are outlined in individual contracts and collective bargaining agreements. The provision of sick pay varies, with some portions covered by the Italian state and others by the employer. The specific amounts depend on the employee’s length of service and the sector of the business.
Female employees are entitled for maternity leave, which is 18 weeks long. However, in the case of having twins, the leave is extended to 22 weeks, and for triplets, it is further increased to 26 weeks.
Out of the total maternity leave period, 11 weeks are mandatory and should be taken, with two weeks before the expected due date and the remaining time after the birth.
Fathers are eligible for a 2-week consecutive period of paid paternity leave, to be taken within the 16 weeks following the birth of their child. This paternity leave is paid by the Social Insurance Fund at 75.20% of the employee’s regular salary.
Termination of Employment
Employers have the authority to terminate employment based on valid and lawful reasons, which may include unsatisfactory performance, redundancy, force majeure, expiration of a fixed-term contract, commission of a serious disciplinary or criminal offense, indecent behavior, or repeated violation of employment rules.
In such cases, the employer must provide notice and a written explanation for the termination. If the reason is misconduct, the employee is given a warning and an opportunity to explain their actions. Upon termination, the employee is entitled to receive severance pay, and all statutory obligations, such as paid time off, are duly compensated.
The probationary period varies depending on the type of role and is explicitly outlined in the employment agreement. Generally, probation periods can range from 6 months but this can be extended to up to two years based on mutual agreement. At the end of the probationary period, the employer can decide whether to confirm the employee’s permanent status or terminate the employment contract.
The length of the probationary period can vary depending on the industry, the job position, and the company’s policies. It is common for probationary periods to last anywhere from 1 to 6 months, with 3 months being a relatively standard duration.
As an EU member state, Cyprus presents a diverse array of options for employers aiming to recruit foreign nationals. The specific requisites, timelines for processing, eligibility for employment, and privileges for accompanying family members may vary according to the particular permit category.
In cases where business visitors lack visa exemption based on nationality, acquiring a business visa becomes necessary to access Cyprus. Such visits are constrained to a maximum of 90 days within a 180-day period and necessitate a comprehensive supporting or invitation letter delineating the purpose and duration of their intended activities.
Among the key work authorization categories are the EU Intracompany Transferee (ICT) permit, streamlining the transfer of managers, specialists, and trainees within the same company from outside the EU, and the Employment Permit for Local Hires, designated for domestically recruited personnel and intracompany transfers who don’t qualify for an EU ICT Permit.
The standard rate of VAT is 19%.