4. Types of leave

There is no information about the types of leave for this country.
Learn more about types of leave >

Paid time off

Employees are entitled to 20 days of paid vacation.

Public holidays

Croatia recognizes 14 public holidays.

Sick days

The company pays for the first 42 days of sick leave. The amount charged is determined by the collective bargaining agreement, but it cannot be less than 70% of the employee's gross wage for the preceding six months.

Employer pays after 42 days, but is reimbursed by the Croatian Health Insurance Fund (HZZO).

Maternity leave

Paid maternity leave is required and begins 28 days before the child's due date (or 45 days if necessary) and ends 70 days after the child's birth. The mother may take paid maternity leave before the baby is six months old after that, but it is not needed.

Paid maternity leave lasts for a total of 208 days.

Paternity leave

The company pays for the first 42 days of sick leave. The amount charged is determined by the collective bargaining agreement, but it cannot be less than 70% of the employee's gross wage for the preceding six months.

Employer pays after 42 days, but is reimbursed by the Croatian Health Insurance Fund (HZZO).

Parental leave

Each parent is entitled to paid maternity leave for each child, which can be used before the child reaches the age of eight. It lasts either 8 months (for the first and second-born child) or 30 months (for the third and fourth-born child) (for twins, third and each subsequent child). When both parents take paternity leave, it lasts for 4 to 15 months, but it lasts for 6 to 30 months if only one parent takes it.

Other leave

5. Employment termination

There is no information about employment information for this country.

Termination process

Employers have the right to cancel a fixed-term contract for the following reasons: business, personal, or employee misbehavior. It demands notification and a written explanation of why the employment relationship is being terminated. If the cause is misbehavior, a warning should be issued and the employee given an opportunity to explain his or her actions.

Severance pay is provided, as are other statutory benefits, such as paid time off.

Notice period

Employees with one year of service get a two-week notice period. For employees with two years of service, the notice period is six weeks. Staff with five years of service will be given an eight-week notice period. Employees with ten years of service will be given a 10-week notice period. Staff with more than 20 years of service will be given a 12-week notice period. Employees over the age of 50 will have their notice term extended by two weeks, while those over the age of 55 will have their notice period extended by four weeks.

Probation period

The probation period cannot be longer than one year.

Severance pay

Employees who have worked for a company for at least two years are entitled to severance pay. Severance pay must equal at least one-third of the employee's annual average monthly wage.

6. Working hours

There is no information about the working hours for this country.

General working schedule

The standard workweek consists of 40 hours spread over five days. Overtime is limited to ten hours per week. Employers must obtain written authorization from employees to expand the scope of their work.

Overtime

Employees may work up to 8 hours per week of overtime if their employer submits a written request for overtime work. Overtime must be compensated at a rate of 50% of the employee's regular salary. Employees are generally not permitted to work more than 180 hours of overtime per year (unless agreed to in collective agreement in which case the maximum is 250 hours).

7. Minimum wage

There is no information about the working hours for this country.

Croatian labor laws mandate a monthly minimum wage of 4,250 HRK or 562.80 EUR (2021), which equates to approximately $680 in US currency at the moment. Employees can bargain for a raise or bonus in their employment contract or through a collective bargaining agreement. However, a bonus for the thirteenth month is not customary in Croatia. Instead, employees frequently receive performance-based bonuses. Although it is not mandatory, many Croatian employers will give employees annual raises based on their service.

8. Employee benefits

There is no information about the working hours for this country.

Croatia has a required health insurance program that is integrated with the mandatory employer social insurance programs. As a result, companies seldom give extra private health care coverage.

Croatian employees frequently receive advantages like as corporate cars, mobile phones, performance-based incentives, and seasonal presents such as cash, business items, or shopping vouchers during Christmas and Easter.

9. Taxes

There is no information about the working hours for this country.

Corporate tax

If a Croatian company has profits of over 3 million kn, the corporate tax rate is 18 percent.

If a Croatian company has profits of less than 3 million kn, the corporate tax rate is 12 percent.

Individual income tax

Income earned in Croatia is subject to a progressive income tax, of three different brackets.

For an annual income between 0 HRK and 48,000 HRK, the tax rate is 0.

For an annual income between 48,001 and 360,000 HRK, the tax rate is 20 percent.

For an annual income in excess of 360,001 HRK, the tax rate is 30 percent.

VAT, GST and sales tax

In Croatia, VAT is charged at three distinct rates. The standard rate is 25%, with two lower rates of 13% and 5% applied to certain products and services. Newspapers, magazines, bread, and milk are all taxed at 13%, as are books and scientific journals, hotels, and medications.

10. VISA and work permits

There is no information about the working hours for this country.

Employers of foreign nationals in Croatia have numerous alternatives under Croatia's immigration system. Croatia is a European Union member. The requirements, processing dates, work eligibility, and perks for accompanying family members differ depending on the kind of permission.

To enter Croatia, business travellers must get a Short-Term Visa (Type C Visa), unless they are visa-exempt due to their nationality or have an appropriate substitute visa. Visas are granted at the discretion of the consular authorities for single, dual, or multiple entry. Visitors on business must restrict their stay to 90 days in each 180-day period.

The Work Registration Certificate, a registration procedure for short-term job permit-exempt activities, and the Stay and Work Permit, suited for a wide variety of work activities, are the two basic work authorization types. The Stay and Work Permit is valid for up to a year and may be renewed.

Croatia also provides a one-year Digital Nomad temporary stay visa for international citizens intending to work remotely from Croatia without the sponsorship of a local enterprise.

11. Employer Of Record service terms

There is no information about the working hours for this country.

Employment contracts

An employment contract must be in writing and include the employment agreement, both parties' names and addresses, the working location, the duties, work hours, probation period, start date, yearly leave, additional leaves, and remuneration.

If an employer fails to finalize a written employment contract, the law thinks it is a permanent deal.

Minimum assignment length

Indefinite contracts, in which the duration of the job is not stated, and definite contracts, in which the term of the employment is specified, are the most prevalent types of contracts.

Payment currency

Croatian Kuna (HRK)

Euro (EUR)

United States Dollar (USD)

Pound Sterling (GBP)

13.Opening a subsidiary in Croatia

There is no information about the working hours for this country.

How to set up a subsidiary

The procedure of establishing a subsidiary in Croatia might range from a few weeks to a few months. Before you can recruit staff or commence operations, you must first form a subsidiary. The steps are as follows:

(1) Creating an account with the Commercial Court

(2) Obtaining a registration number from the Croatian Bureau of Statistics

(3) VAT registration with the Tax Authority

(4) Signing up for a pension (HZMO) and health insurance (HZZO)

(5) Establishing a local bank account

The Articles of Association are the primary document for a subsidiary. According to Croatian subsidiary rules, this document must contain information about the parent business, the subsidiary's purpose and operations, the board of management, the obligations of each founding member, and other information.

Subsidiary laws

For your organization to stay compliant, you must complete all of the processes outlined above. Croatia subsidiary laws are made up of two basic documents: the Croatian Company Act and the Commercial Code. These sets of legislation regulate all subsidiary operations in the nation and are required if you wish to establish a Croatian subsidiary.

It takes roughly a week to register your subsidiary after you have all of the necessary papers. The Articles of Association are notarized and presented to the Commercial Court during this period. Every registered subsidiary in Croatia requires a certificate of registration as well as a business seal for everyday activities.

13. Why choose Rivermate as your Employer of Record / PEO in Croatia

Establishing an entity in

Croatia

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

Croatia

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

Croatia

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

Croatia

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

Croatia

via our Employer of Record / PEO solution.

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