Explore our EOR & PEO services in SLOVAKIA
As your Slovakia EOR, we would support your growth by contracting personnel and handling their payment without establishing a local branch office or subsidiary. Plus, we have our own Acvian legal entity in Slovakia.
In compliance with regional labor laws, your individual is employed by a Slovakia PEO and can be onboarded in days as opposed to the usual months. Your new employee will start working for you soon, similarly to the rest of your team.
A piece of peace in Central Europe
Country Overview
Slovakia is a landlocked country in Central Europe. Neighboring countries include Austria, Czech Republic, Hungary, Poland, and Ukraine. The geography of Slovakia is known for its mountains, with the Carpathian Mountains extending across most of the northern half of the country. The government system is a parliamentary democracy; the chief of state is the president, and the head of government is the prime minister. Slovakia has a mixed economic system in which there is a variety of private freedom, combined with centralized economic planning and government regulation. Slovakia is a member of the European Union (EU). Slovakia EOR receives a great feedback for expats, see its specifics below.
General Information
- Population: ~5.500.000
- Capital City: Bratislava (population: ~425.000)
- GDP: ~$105.5 billions
- GDP per capita: ~$20.000
- Currency: Euro (EUR)
- Unemployment: ~6.79%
- Employer Taxes: ~34.2%
- Employee Taxes: 19% – 25%
SLOVAKIA PEO SPECIFICS
Employment contracts in Slovakia
Slovak law allows employers and employees to agree upon one of two basic types of job contracts:
- Fixed-term employment contract is limited to up to two years, can be prolonged or renewed, but only twice within two years.
- Employment contract for unlimited time does not state a fixed period for the contract’s validity.
An employment relationship shall be established by a written employment contract.
Probation period in Slovakia
Probation period: an employment contract may specify a probationary period which should not be more than 3 months (some senior managerial positions can have 6 months probationary period); the probation period may not be extended.
Travel allowances in Slovakia
From the 1st of January 2023, the amount of business travel allowances to increase came into effect, as follows.
- EUR 6.80 for a duration of 5 to 12 hours,
- EUR 10.10 for a time duration that is longer than 12 hours capped at 18 hours,
- EUR 15.30 for a time duration that is longer than 18 hours.
Meal vouchers in Slovakia
In Slovakia, new meal allowance amounts will come into effect starting January 1, 2023, as reported by KPMG. These changes will impact employers who provide meal vouchers or reimburse employees for meal expenses during work hours. The updated meal allowance amounts aim to better reflect the increasing costs of living and inflation in the country.
If the employer contributes to subsistence in the form of a main meal or a meal voucher to other employees, the amount of the financial contribution for meals is usually at least 55 % of the minimum possible value of the meal voucher. The financial contribution for meals is EUR 5.10. from the 1st of January 2023.
Working hours in Slovakia
Working time of an employee shall be 40 hours. An employee’s average weekly working time including overtime may not exceed 48 hours. There are certain exceptions to the given rule related to the planning of working time, nature of work, age of an employee.
Vacation days in Slovakia
Employees are entitled to 20 working days of vacation (25 days from the age of 33 per legal provision).
Sick leave in Slovakia
Income compensation provided by employer:
- From the first to the third day of temporary incapacity: 25% of the ‘daily measurement basis’;
- From the fourth to tenth day of temporary incapacity: 55% of the ‘daily measurement basis’.
Sick pay from the state social insurance system from the 11th day of temporary incapacity for work:
- From the 11th day of temporary incapacity: 55% of the ‘daily measurement basis’.
Sick pay is paid up to a maximum of 52 weeks from the first day of temporary incapacity for work.
Maternity / Paternity leave in Slovakia
Maternity leave – lasts for 34 weeks (37 weeks for a single mother or 43 weeks if the mother has two or more babies at the same time). As a rule, the entitlement to maternity leave starts at a minimum of six and a maximum of eight weeks before the due date.
Parental leave – employees may request parental leave from their employer in order to spend more time looking after their children. Slovakia EOR or regular employers must grant such a request. Parental leave is provided for as long as the parent requests it (as a rule for at least one month) until the child reaches three years of age. If a child suffers long-term ill health requiring special care, employers must approve a request for parental leave until the child reaches six years of age.
Wages and Salary Payment in Slovakia
As per the provisions of the Payment of Wages Act, 1936, wages need to be paid to employees by employer or Slovakia PEO before the expiry of the 7th day of the last day of the wage period, where the number of employees is less than 1000. In case the number of employees is less than 1000, wages must be paid before the expiry of the 10th day of the last day of the wage period.
Benefits in Slovakia
There are 13th and 14th salaries in place in Slovakia:
The 13th salary must be paid out at least in the amount of the average monthly earnings of the employee, and in June. As of 30 April of the respective calendar year, the employee must have worked for the employer at least 24 months in a row;
The 14th salary must be paid out at least in the amount of the average monthly earnings of the employee, and in December. As of 31 October of the respective calendar year, the employee must have worked for the employer at least 48 months in a row.
Bonuses / Expenses in Slovakia
In the case of business trips, an employee is entitled to reimbursement of travel expenses and travel per diems according to the valid regulations (the amount differs according to the length and the country of a business trip).
Employer Taxes in Slovakia
Social Security Contribution Adjustment: Effective January 1, 2024, the employer’s health-care insurance rate has been elevated from 10% to 11%.
Consequently, beginning on this date, employers are mandated to deduct monthly pay-related insurance contributions totaling 36.2% of an employee’s gross salary, as opposed to the previous rate of 35.2%.
Additionally, employers are required to withhold the employee’s contribution of 13.4% of their gross salary. It’s important to note that certain contributions are subject to caps. The Social Security Contribution (SSC) encompasses both social security and health insurance contributions.
Employee Taxes in Slovakia
Commencing on July 1, 2023, annual taxable income up to EUR 47,537.98 incurs a tax rate of 19%, while any income exceeding this threshold is subject to a 25% tax rate.
Effective January 1, 2024, the withholding tax on dividend profits rises from the existing 7% to 10%. This elevated taxation of dividend profits pertains solely to profits generated after January 1, 2024; profits from the year 2023 will remain subject to the 7% rate regardless of the year in which they are disbursed.
Furthermore, the increase in withholding tax from 7% to 10% extends to companies undergoing liquidation if they possess a liquidation balance to settle post-liquidation. This heightened withholding tax on the liquidation balance applies exclusively to those balances.
Notice Period in Slovakia
The minimum notice period is one month.
But the notice period is at least two months for the employee that has been in service for at least one but less than five years and at least three months for the employee that has been in service for at least five and more years if the employer terminates the employment relationship:
- for economic reasons (the organization or its part is abolished or relocated and the employee does not agree with the change in his or her agreed place of work or the employee became redundant from technical or organizational reasons)
- or due to changes in the health condition of the employee.
An employer can give immediate notice when the employee has breached the work discipline or was condemned for a premeditated criminal act.
Termination / Severance in Slovakia
Severance pay must only be paid if the employment has been terminated by notice of the employer / Slovakia PEO or by agreement between the employer and the employee for the reasons of winding-up or relocation of the employer or a part thereof, the redundancy of the employee, the employee’s long-term medical inability to perform work, or the inability to perform work due to accident at work, occupational disease or its threat or due to reaching the maximum exposure at work set by the public health authority.
The employee has the right to severance pay amounting to one monthly salary if his/her employment relationship has lasted more than two years. The employee obtains twice his average monthly earnings if he/she has worked from five to ten years for the employer.
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