Quick facts

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Cyprus, an island nation in the Eastern Mediterranean, has a service-oriented economy driven by tourism, financial services, and shipping. It is a member of the European Union and offers a favorable business climate. With its strategic location, Cyprus serves as a regional hub for trade and business, connecting Europe, Asia, and Africa.

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Employment Contracts

Employment contracts in Cyprus can be temporary or permanent. Employers must provide employees with a detailed employment contract or a letter of appointment within one month of starting work, as per Cypriot labor law.

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Probation Period

The probation period in Cyprus can last up to six months. However, employers can extend it beyond this period, during which the law on unlawful dismissal does not apply.

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Working Hours

The standard working week in Cyprus is 38 hours, typically spread over five days. This can vary slightly between industries, with overtime generally being paid. Working hours are capped at 40 hours per week.

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Vacation Days

Employees who work 48 weeks in a year are entitled to four weeks of paid annual leave. For those working a five-day week, this equals 20 working days of leave, and for those on a six-day week, 24 working days.

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Sick Leave

Sick leave is available for employed and self-employed individuals aged 16 to 63 who are unable to work due to illness. Sick pay is available for up to 156 days per period of incapacity, with the possibility of an extension under specific conditions. There is a three-day waiting period for sick pay to begin for employed workers.

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Wages and Salary Payment

In Cyprus, wages must be paid at least weekly or monthly, depending on the agreement between the employer and employee. Delayed payments are considered a violation of the law. As of 2024, the minimum wage for full-time employees is €900 gross per month, rising to €1,000 after six months with the same employer. Specific minimum wages apply in the agricultural sector.

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Public Holidays

There are 14 public holidays in Cyprus.

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If a public holiday falls on a weekend, employees are typically given a substitute day off.

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Employer Taxes

Employers in Cyprus contribute to various social funds:

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• Social Insurance Fund: 8.8% (capped at €5,239 gross per month).
• Redundancy Fund: 1.2% (capped at €5,239 gross per month).
• Industrial Training Fund: 0.5% (capped at €5,239 gross per month).
• Social Cohesion Fund: 2% of gross income.
• GESY (General Health System): 2.9% of gross income (capped at €180,000 per annum).

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Employee Taxes

Employees in Cyprus contribute to the following:

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• Social Insurance Fund: 8.8% (capped at €5,239 gross per month).
• GESY (General Health System): 2.65% of actual income.

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The personal income tax rates in Cyprus are as follows:

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• 0% on income up to €19,500.
• 20% on income between €19,501 and €28,000.
• 25% on income between €28,001 and €36,300.
• 30% on income between €36,301 and €60,000.
• 35% on income above €60,000.

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Notice Period

The notice period in Cyprus depends on the length of employment:

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• For employment between 26 and 51 weeks, the notice period is 1 week.
• For 52 to 103 weeks, the notice period is 2 weeks.
• For 104 to 155 weeks, it is 4 weeks.
• The maximum notice period is 6 weeks for employment of 208 to 259 weeks.

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Employers are not required to give notice during the probation period if it does not exceed 104 weeks (2 years). The typical probation period is between 3 to 6 months.

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Termination and Severance Pay

In the event of dismissal, the notice period varies based on employment duration, with a minimum of 1 week for employees working less than 52 weeks, and up to 8 weeks for employees with 312 working weeks. If an employee chooses to resign, the notice period is 1 to 3 weeks, depending on their length of service.