Hire in Greece through our Employer of Record (EOR)

Greece's employment landscape is a complex tapestry woven from its rich cultural heritage, recent economic challenges, and ongoing adaptation to global trends. The country's workforce, while well-educated, faces challenges such as an aging population, skill mismatches, and high unemployment rates. Despite these hurdles, Greece's labor market is evolving, with the service sector leading employment and a growing emphasis on digital skills and adaptability.

Overview of Labor Laws

Greek labor laws are designed to protect workers' rights while providing a framework for employer-employee relationships. Key aspects include:

• A standard 40-hour workweek with provisions for overtime pay
• Minimum wage regulations that are periodically reviewed
• Mandatory social security contributions from both employers and employees
• Strict regulations on termination of employment, including severance pay requirements
• Provisions for annual leave, sick leave, and maternity/paternity leave
• Anti-discrimination laws covering various aspects including gender, age, and ethnicity

These laws are generally worker-friendly and align with broader European Union directives on labor rights.

Cultural Considerations

Greek work culture is characterized by:

• Strong emphasis on personal relationships and trust-building in professional settings
• A more relaxed approach to time management compared to some Northern European countries
• High value placed on family obligations and work-life balance
• Direct communication styles, often accompanied by expressive body language
• Respect for hierarchy and seniority, particularly in traditional industries
• A blend of Mediterranean warmth and professionalism in workplace interactions

Understanding and respecting these cultural nuances can significantly enhance workplace harmony and productivity.

Challenges of Direct Hiring

Direct hiring in Greece can present several challenges:

1. Complex labor laws: Navigating the intricacies of Greek employment regulations can be daunting for foreign companies.

2. Language barrier: While English proficiency is improving, language can still be a significant obstacle in recruitment and daily operations.

3. Bureaucratic processes: Administrative procedures for hiring, especially for foreign workers, can be time-consuming and complex.

4. Skills mismatch: Finding candidates with the right skill set can be challenging due to misalignment between education and market needs.

5. High non-wage costs: Employers face substantial social security contributions and other mandatory benefits.

6. Cultural adaptation: Foreign companies may struggle to adapt to local work culture and expectations.

7. Economic uncertainty: Ongoing economic challenges can make long-term workforce planning difficult.

These challenges underscore the potential benefits of partnering with local experts or considering alternative employment models when entering the Greek market.

Greece's payroll and tax system is a complex structure that involves contributions from both employers and employees. This system is designed to fund various social welfare programs, including pensions, healthcare, and unemployment benefits. Understanding the intricacies of this system is crucial for both employers operating in Greece and employees working in the country.

In Greece, the payroll process involves careful calculation of gross salaries, deduction of various contributions and taxes, and the final disbursement of net salaries to employees. The tax system is progressive, meaning that higher earners pay a larger percentage of their income in taxes. Both employers and employees have specific responsibilities when it comes to payroll and taxes in Greece.

Employer Contributions

Employers in Greece are required to make significant contributions to the social security system on behalf of their employees. These contributions are a crucial part of the overall compensation package and fund various social welfare programs. Here's a breakdown of the main employer contributions:

1. Pension Insurance: Employers contribute approximately 13.3% of an employee's gross salary towards pension insurance. This forms part of a total contribution of 26.95%, with the remainder coming from the employee.

2. Health Insurance: About 7% of an employee's gross salary is contributed by the employer for health insurance. The total contribution for health insurance is 13.87%.

3. Unemployment Insurance: Employers pay around 1.65% of the gross salary towards unemployment insurance, which is part of a total 3.9% contribution.

4. Other Contributions: Depending on the nature of the job, employers may need to make additional contributions, such as for labor accident insurance. The rates for these can vary based on the risk level of the job.

It's important to note that these contributions are subject to certain ceilings, which are periodically adjusted. Employers are responsible for calculating these contributions, withholding the employee's share from their salary, and remitting the total amount to the e-National Social Security Fund (e-EFKA) on a monthly basis.

Employers also have the responsibility of registering with the appropriate Greek authorities and maintaining accurate payroll and tax records. In some specific regions of Greece, employers may benefit from temporarily reduced social security contribution rates.

Employee Contributions

Employees in Greece also bear a significant portion of the social security contributions and are subject to income tax. Here's an overview of the main employee contributions and tax obligations:

1. Income Tax: Greece uses a progressive income tax system. The tax rate increases as income rises, with tax brackets and rates subject to periodic adjustments. Income tax is typically withheld from the employee's salary through a Pay As You Earn (PAYE) system.

2. Pension Insurance: Employees contribute approximately 13.65% of their gross salary towards pension insurance.

3. Health Insurance: About 6.87% of an employee's gross salary goes towards health insurance contributions.

4. Unemployment Insurance: Employees contribute around 2.25% of their gross salary to unemployment insurance.

5. Solidarity Contribution: This is an additional tax imposed on higher income earners in Greece. The rates and income thresholds for this contribution are subject to change.

Employees may also be eligible for certain itemized deductions when filing their annual tax returns. These could include alimony payments under specific conditions or charitable donations to approved organizations.

It's crucial for employees to understand that while their employer withholds these contributions and taxes from their salary, they are still required to file an annual tax return. This return helps calculate the final tax liability and determines if any refunds are due or additional taxes need to be paid.

Understanding these contributions and tax obligations is essential for both employers and employees in Greece. It ensures compliance with local regulations and helps in effective financial planning. As with any complex system, it's advisable to consult with local tax experts or use the services of a global Employer of Record like Rivermate to navigate the intricacies of Greek payroll and tax regulations.

Greece offers a comprehensive set of employee benefits, ensuring workers enjoy a high level of protection and support. As an Employer of Record (EOR), Rivermate expertly manages these benefits, ensuring compliance with local labor laws while allowing companies to focus on their core business operations. By partnering with an EOR, businesses can navigate the complexities of Greek employment regulations with ease, providing their employees with all mandatory benefits and potentially offering additional perks to attract top talent.

Mandatory Benefits

• Annual Leave: Employees receive a minimum of 20 calendar days of paid annual leave per year
• Public Holidays: 12 official paid public holidays annually
• Sick Leave: Paid leave for illness, duration based on medical documentation
• Maternity Leave: 17 weeks of fully paid leave, with an optional 6-month unpaid extension
• Paternity Leave: 14 days of paid leave for new fathers
• Parental Leave: 4 months of unpaid leave shared between parents
• Social Security Contributions: Employers must contribute to employees' social security
• Notice Period: Minimum notice period required before employment termination
• 13th & 14th Month Salary: Two additional bonus payments per year
• Severance Pay: Provided under specific circumstances, such as termination without just cause

Optional Benefits

• Private Health Insurance: Enhanced coverage and access to specialists
• Wellness Programs: Gym memberships, health coaching, and discounts on health services
• Supplemental Pension Plans: Additional retirement savings options
• Life Insurance: Financial security for employees' families
• Flexible Work Arrangements: Remote work, flextime, and compressed workweeks
• Childcare Assistance: Subsidies or on-site childcare facilities
• Meal Vouchers or Allowances: Offsetting the cost of meals during work hours
• Transportation Allowances: Coverage for commuting expenses
• Additional Paid Time Off: Beyond the mandatory minimum
• Educational Assistance: Support for further education or professional development
• Employee Discounts: Reduced prices on company products or services

By offering a mix of mandatory and optional benefits, employers in Greece can create attractive compensation packages that promote employee satisfaction, well-being, and loyalty. As an EOR, Rivermate ensures that all mandatory benefits are properly administered while also helping companies implement optional benefits that align with their organizational goals and culture.

The process of termination and offboarding in Greece is governed by a comprehensive legal framework that aims to balance employer flexibility with employee protection. This process involves several key steps and considerations that both employers and employees should be aware of.

When it comes to terminating an employee in Greece, employers must have valid grounds for dismissal. These can include serious misconduct, such as breach of contract or negligence, the employee's inability to perform their duties adequately, or operational requirements like economic or organizational changes necessitating job cuts.

Notice Requirements

One of the crucial aspects of the termination process in Greece is providing proper notice. Employers are legally obligated to give written notice to employees before termination. The length of this notice period varies depending on factors such as:

• The employee's position (manual worker or salaried employee)
• Length of service
• Compensation level

For manual workers, notice periods can range from a few days to several months. Salaried employees typically receive longer notice periods, which can extend from one month to a year, based on their seniority and compensation. It's worth noting that employees have the option to receive compensation instead of serving the notice period.

Severance Pay

In cases of dismissal due to operational requirements (redundancy), Greek law mandates that employees receive severance pay. The calculation of this severance pay takes into account:

• The employee's length of service
• Salary level

This provision ensures that employees are financially supported during their transition period.

Ensuring Fair Termination

To maintain compliance with Greek labor laws and avoid potential legal issues, employers must ensure that all dismissals are based on valid, well-documented justifications. This documentation is crucial in demonstrating fair termination practices.

Consequences of Unfair Dismissal

If a termination is deemed unfair by the courts, employees may be entitled to:

• Compensation
• Reinstatement
• Or both, depending on the court's decision

Offboarding Process

The offboarding process in Greece typically involves:

1. Conducting an exit interview
2. Retrieving company property
3. Settling any outstanding financial matters
4. Providing necessary documentation (e.g., certificate of employment)
5. Ensuring a smooth handover of responsibilities

By following these steps and adhering to the legal requirements, employers in Greece can navigate the termination and offboarding process effectively while respecting employee rights and minimizing potential disputes.

Greece, with its rich history and stunning Mediterranean landscapes, attracts many foreign workers seeking new opportunities. However, before embarking on your Greek work adventure, it's crucial to understand the visa and work permit requirements for non-EU citizens.

Visa Requirements

Foreign workers from non-EU countries typically need to obtain a visa before entering Greece for work purposes. The most common type is the long-stay visa (National Visa or Type D), which allows you to stay in Greece for more than 90 days.

To apply for a long-stay visa, you'll need to:

1. Have a valid job offer from a Greek employer
2. Submit a completed visa application form
3. Provide a valid passport
4. Supply passport-sized photographs
5. Show proof of sufficient funds
6. Provide health insurance coverage
7. Present a clean criminal record certificate

Work Permit Process

Once you've secured your visa, you'll need to obtain a work permit. The process typically involves the following steps:

1. Your Greek employer must apply for your work permit at the local Decentralized Administration office.
2. The employer needs to prove that the position cannot be filled by a Greek or EU citizen.
3. Upon approval, you'll receive a temporary residence permit for employment purposes.
4. Within 30 days of arrival in Greece, you must apply for a residence permit at the local Aliens Bureau.

Important Considerations

• The work permit is usually valid for one year and can be renewed.
• Your work permit is tied to your specific employer and job position.
• EU citizens don't need a work permit but should register with local authorities if staying longer than three months.

Remember that visa and work permit requirements can change, so it's always best to check with the Greek embassy or consulate in your home country for the most up-to-date information before making any plans.

By understanding and following these requirements, you'll be well-prepared to start your Greek work experience legally and smoothly.