Employer of Record Guide in 

Cyprus

Vacation Leave

Minimum Entitlement:

• 5-day work week: 20 days paid annual leave
• 6-day work week: 24 days paid annual leave

Accrual: Full entitlement after 48 weeks continuous employment Payment: Direct by employer or through Central Holiday Fund Termination: Must compensate for accrued unused days

Sick Leave

• Employer Obligation: No payment required for first three days
• Social Insurance Benefit: From day 4, up to 156 days at 60% of regular salary (extendable for severe illness)
• Medical Certificate: Required within 48 hours of absence start

Maternity Leave

Note: Please verify current legislation - research indicates potential discrepancy in duration

Duration: 22 consecutive weeks for first/second child, 26 weeks for third+ child (as of March 2024)

Additional Provisions:

• Mandatory Period: 11 weeks starting no later than two weeks before expected birth
• Hospitalisation Extension: Additional week for every 14 days newborn hospitalised (max 8 weeks)
• Job Protection: From pregnancy start until five months after maternity leave end
• Breastfeeding Break: One paid hour daily for 12 months post-birth

Parental Leave

• Paternity Leave: 2 consecutive weeks paid (within 16 weeks of birth, requires 6+ months employment)
• Parental Leave: 18 weeks unpaid per parent per child (up to age 15), 23 weeks for single parents
• Flexibility: Maximum 5 weeks per year, subject to employer agreement

Bereavement Leave

Note: Please verify statutory vs. customary entitlements

Common practice includes:

• Child/Spouse: 5 days
• Parent/Sibling: 3 days
• Other Family: 1 day

Personal & Family Leave

• Carer's Leave: 5 working days unpaid per year (requires medical certificate)
• Force Majeure Leave: 7 days unpaid per year for urgent family reasons

Summary

Termination Types

Summary Dismissal (With Cause):

• No notice required for serious misconduct, criminal offence, or behaviour making employment untenable

Termination Without Cause:

• Valid reasons include redundancy, unsatisfactory performance, contract end

Constructive Dismissal:

• Employee resignation due to employer's repudiatory breach

Notice Period Requirements

Based on continuous service:

Pay in Lieu of Notice (PILON): Permitted Job Search Time: Up to 8 hours per week during notice period

Severance Pay

Requirements: Generally required for redundancy after 104+ weeks service or unlawful dismissal

Calculation for Unlawful Dismissal:

• Up to 4 years: 2 weeks' wages per year
• 5-10 years: 2.5 weeks' wages per year
• 11-15 years: 3 weeks' wages per year
• 16-20 years: 3.5 weeks' wages per year
• 20+ years: 4 weeks' wages per year

Redundancy: Paid from national Redundancy Fund, not employer

Probationary Periods

• Standard Length: 6 months maximum
• Extension: Up to 104 weeks by written agreement (simplified termination rules apply only to initial period)
• Termination Rights: Either party can terminate without notice/reason during first 26 weeks

Final Pay Requirements

Timeline: No specific statutory deadline, but prompt payment required Components: Unpaid wages, unused leave, pro-rata 13th salary (if applicable), other contractual entitlements

Termination Documents & Process

Required:

• Written notice stating reason and effective date
• Fair process with opportunity to be heard

Recommended:

• Certificate of employment

Anti-Discrimination & Retaliation Laws

Protected activities include trade union participation and filing good faith complaints. Termination cannot be based on protected characteristics including gender, race, religion, age, disability, sexual orientation, or political beliefs.

National Holidays (2025)

Holiday Pay Rules

Premium Pay: Typically 200% of normal wage or compensatory time off for holiday work

Regional Variations

No official regional holidays - statutory holidays are observed nationwide.

Required Documents for Employment

• Employment Statement: Written terms required within seven days of start date
• ERGANI System Registration: Electronic registration required at least one day before employment begins
• Work Authorisation: Verification required (passport/work permit for non-EU citizens)
• Tax & Social Insurance: ID card and social insurance number required one day before start
• Banking Information: For payroll purposes

Language Requirements

• Official Languages: Greek and Turkish
• Business Language: English widely spoken
• Contracts: Should be in language employee understands

Background Checks & References

Permitted with GDPR compliance:

• Criminal record checks (especially for trust positions)
• Credit/financial checks (for financial roles only)
• Employment & education verification
• Medical checks (only if job-relevant physical/mental fitness required)

Requirements: Explicit consent and proportionality to role

Data Protection & Privacy

• Framework: EU GDPR applies
• Collection: Limited to employment necessity
• Consent: Required for sensitive data processing

IP Assignment & Confidentiality

• Default IP Ownership: Employer owns work-created IP unless otherwise agreed
• Confidentiality: Standard clauses recommended, obligation continues post-employment
• Non-Compete: Generally void but may be upheld if reasonable in scope, duration (6-12 months), geography, and protecting legitimate business interests

Probation Period Setup

• Standard: 6 months
• Extension: Up to 104 weeks by written agreement
• Simplified Termination: Applies only to initial period (usually first 26 weeks)

Onboarding Timeline

What the EOR Handles

Borderless AI will handle:

• Compliant contract generation
• Payroll processing and remittances
• Benefits administration
• Legal compliance management
• Authority registrations

Worker Classification: Employee vs Contractor

Employee Indicators:

• Subordination (employer control)
• Business integration
• Regular salary
• Set working hours

Independent Contractor Indicators:

• Work control maintained
• Not integrated into organisation
• Responsible for own taxes/social insurance

Misclassification Penalties: Back payments for taxes, social security, benefits, plus fines and potential lawsuits

Unionisation & Collective Agreements

• Right to Unionise: Constitutional right
• Collective Bargaining: Common, can provide more favourable terms than statutory minimums
• High Union Density: Public/semi-public sectors, banking, construction, hotels

Cultural Norms & DEI Expectations

Cyprus workplace culture emphasises relationship-building and work-life balance.

• Work-Life Balance: Recent legislation emphasises balance with parental leave and flexible arrangements
• Communication: Relationship-based business culture, formal but rapport-building important
• DEI: Growing prominence as strategic advantage and social responsibility

Remote Work Considerations

Legal Framework: Framework Regulating Remote Working Law (120(I)/2023)

Employer Obligations:

• Voluntary agreement basis (except public health emergencies)
• Cover remote work costs (equipment, internet, home office expenses)
• Respect right to disconnect

Cross-Border: Complex tax and social security implications require specialised advice