Guide to employment, payroll and benefits in

Bosnia and Herzegovina

Rivermate offers complete payroll, benefits and compliance services for

Bosnia and Herzegovina

01. Overview

Last updated: 

August 19, 2021

Currency
Bosnia And Herzegovina Convertible Mark
Capital
Sarajevo
Ease of doing business
65.4
Language
Croatian
Population
3280819
GDP growth
3.19%

02. Grow your team in

Bosnia and Herzegovina

with Rivermate

Payroll, benefits, taxes, and compliance can be difficult to manage in

Bosnia and Herzegovina

, particularly if you don't have established local relationships. You can hire employees in

Bosnia and Herzegovina

effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global employment solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

03. Summary

Bosnia and Herzegovina (abbreviated as BiH or B&H), also known as Bosnia–Herzegovina and Bosnia, is a country in South and Southeast Europe that is part of the Balkans. Sarajevo is the capital and largest city of Bosnia and Herzegovina. Serbia borders Bosnia and Herzegovina on the east, Montenegro on the southeast, and Croatia on the north and southwest. It is not completely landlocked; to the south, it has a 20-kilometer-long Adriatic Sea coast that surrounds the town of Neum. The climate in inland Bosnia is moderately continental, with hot summers and cool, snowy winters. The geography of the country is mountainous in the central and eastern interior, moderately hilly in the northwest, and largely flatland in the northeast. Herzegovina, the smaller southern area, has a Mediterranean climate and mostly mountainous terrain. Bosnia and Herzegovina has been inhabited since at least the Upper Paleolithic, but permanent human settlement dates from the Neolithic period, when Butmir, Kakanj, and Vuedol cultures lived there. It was settled by many Illyrian and Celtic cultures until the arrival of the first Indo-Europeans. The nation has a rich but complicated cultural, political, and social past, having been settled by the South Slavic peoples who now inhabit the region from the 6th to the 9th centuries. The Banate of Bosnia was founded in the 12th century, and it developed into the Kingdom of Bosnia in the 14th century before being incorporated into the Ottoman Empire, under whose rule it remained from the mid-15th to the late 19th centuries. The Ottomans introduced Islam to the region and influenced much of the country's cultural and social outlook. After incorporation into the Austro-Hungarian Monarchy, which lasted until World War I, Bosnia and Herzegovina became part of the Kingdom of Yugoslavia during the interwar period, and after World War II, it was granted full republic status in the newly created Socialist Federal Republic of Yugoslavia. Following Yugoslavia's disintegration, the republic declared independence in 1992, which was followed by the Bosnian War, which lasted until late 1995 and ended with the Dayton Agreement. According to the constitution, the country is divided into three ethnic groups or constituent communities. Bosniaks are the majority of the three ethnic groups, followed by Serbs and Croats. In English, a native of Bosnia and Herzegovina, regardless of nationality, is commonly referred to as a Bosnian. Jews, Roma, Ukrainians, and Turks are also considered minorities under the constitutional definition of "Others." Bosnia and Herzegovina has a bicameral legislature and a three-member Presidency made up of representatives from each of the country's main ethnic groups.

04. Public holidays

05. Types of leave

Paid time off

Employees are entitled to a minimum of 20 days and a maximum of 30 days of paid leave per year. Employees who are starting their first job who have been out of employment for more than 15 months are eligible for a six-month break after serving for six months. Employees under the age of 18 and others who serve in dangerous jobs are entitled to more time off.

Public holidays

The following public holidays are observed in Bosnia-Herzegovina:FBHNew Year’s DayIndependence DayRoman Catholic Good FridayRoman Catholic Easter MondayLabor DayEid al-FitrIslamic New YearAll Saints’ DayStatehood DayRoman Catholic ChristmasRSNew Year’s DayOrthodox ChristmasRepublic DayOrthodox Good FridayOrthodox Easter MondayLabor DayVictory DayDayton Peace Accord Day

Sick days

Employees of the FBH are entitled to seven days of paid leave for sickness or the death of a family member, while those in the RS are entitled to five days.

Maternity leave

Female employers are entitled to a year of paid maternity leave, or 18 months if they have several children. On request and with a doctor's notice, the mother may begin her leave up to 28 days before the child's birth, and she must take a minimum of 42 days in FBH or 60 days in the RS after the child's birth.When a specialist decides that the child needs more than normal treatment, a breastfeeding mother is entitled to two absences per day to nurse her child until the child is one year old, and parents of children aged one to three years old are entitled to serve part-time, at half pay. Disabled children's parents have special protections. Normally, an employee who is pregnant and on maternity leave cannot be fired.

Paternity leave

After the mother has taken her mandatory time, the father can participate or use the mother's unused maternity leave if the parents consent. One adult has the freedom to exercise any of these rights in situations of adoption or foster parenting.

Parental leave

Other than the already mentioned terms for maternity leave, there are no other provisions in the Bosnia and Hezegovina law regarding parental leave.

Other leave

06. Employment termination

Termination process

Employees may be terminated with notice if the termination is justified for business reasons or if the employee is unable to fulfill his or her assigned responsibilities and the employer is unable to transfer or retrain the employee for a new position with reasonable effort. If either the employer or the employee commits a major criminal or breaches a contract, either party may end the employment relationship without warning. The contract-breaking party must act within 15 days of finding the reason for termination.

Notice period

Notices of termination must be in writing and give a reason for the dismissal. Employers are required by the FBH to provide written notice to employees at least 14 days in advance, unless the employee is on probation, in which case only seven days notice is required. When an employee resigns, the individual is required to give seven days' notice. Employers and employees may agree on a varied notice period, although it cannot exceed one month if the employee serves notice to the employer or three months if the company terminates the employee. The minimum notice period required by the RS is 30 days for companies and 15 days for employees. The BD provides for a 14-day notice period regardless of whether party gives notice.

Severance pay

Severance pay is determined by the collective bargaining agreement, rule book, and employment contract, but cannot be less than one-third of the average monthly wage for the preceding three months for each full year of service with the employer.

Probation period

The probation period may not last longer than six months for the Federation of Bosnia and Herzegovina, and three months for the Republic of Srpska.

07. Working hours

General

In Bosnia and Herzegovina, the standard workweek is 40 hours spread over five days. In some instances, a workweek may be extended. Minors are not permitted to work more than 35 hours per week, and pregnant women, mothers of children under the age of three, and single parents (including single adoptive and foster parents) may be required to work overtime only with their express written consent.

Minors, pregnant women who have reached the sixth month of their pregnancy, and mothers, adoptive and foster parents with children under the age of two are prohibited from working between the hours of 10 p.m. and 6 a.m.

Overtime

In most cases, overtime is limited to ten hours per week and must be justified by an emergency or an unexpected operational need. Overtime and night work compensation is not fixed, and these increases in compensation should be documented in the employment contract.

08. Minimum wage

General

Bosnia and Herzegovina's minimum wage was last increased in 2020 to 520 convertible marks per month. According to Bosnia and Herzegovina compensation laws, employees must be paid at least that amount. While bonuses are not required, they are common and frequently paid at the end of the year.

09. Employee benefits

General

Employers pay 4% of an employee's income to health insurance in the Federation of Bosnia and Herzegovina. 12.5 percent is contributed by the employee.

In Republika Srpska, only the employee pays a 12% contribution to health insurance.

10. Why Rivermate as your Employer of Record / PEO?

Establishing an entity in

Bosnia and Herzegovina

to hire a team takes time, money, and effort. The labor law in

Bosnia and Herzegovina

has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into

Bosnia and Herzegovina

simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record solutions in

Bosnia and Herzegovina

give you peace of mind so you can focus on running your business.

Please contact us if you'd like to learn more about how Rivermate can help you hire employees in

Bosnia and Herzegovina

via our Employer of Record / PEO solution.

Ready to get started? Our friendly staff is ready to assist you with all your questions, let's connect.