Great talent is everywhere. A well-known tourism destination, Cyprus is also home to a young, dynamic, and highly-skilled talent pool. But sometimes, the problem is legally hiring the talent that you need.
An Employer Of Record (EOR) can be ideal for companies looking to hire and pay talent around the world without legal hassle.
This article will walk you through the processes and advantages of hiring employees in Cyprus through an EOR.
Why Hire Talent in Cyprus?
One of the more recent countries to join the EU, Cyprus has revamped its taxation and hiring laws to attract large global companies to the island. The country is now one of the go-to places for big tech, with Amazon recently opening a base here.
Cyprus boasts some of the lowest individual and corporate taxes in the EU, making it attractive for both top talent and employers. This has put it on the map as a home base for innovative and highly-skilled workers.
On top of that, Cyprus ranked 22nd on the Global Talent Ranking in 2022. This is largely due to the country’s aggressive talent development initiatives and investment in education.
Another advantage of hiring in Cyprus is the country’s multilingual workforce. In addition to Greek and/or Turkish (the two official languages), most locals speak fluent English and many have a working knowledge of other European languages.
How Can I Legally Hire an Employee in Cyprus?
Things can get tricky if you want to legally hire talent in Cyprus on your own. While you don’t need to set up a legal entity to hire in Cyprus, navigating the local laws and regulations can still be challenging.
This is where EORs come in handy. An EOR acts as a broker for hiring talent outside of the country you legally operate in. It will already have an entity set up and the legal framework in place to do the hiring for you. You, on the other hand, will manage the relationship with your employees.
Going through an EOR is possibly the easiest way to hire talent in Cyprus without all the legal hassle.
What Does an EOR Do?
Simply put, EORs take care of the legal procedures while you manage your employees. The legal frameworks for hiring in Cyprus can be quite different from those in the US and Canada. EORs handle worker visas and work permits, employment contracts, payroll, local compliance, termination, and many other HR and financial services.
For example, did you know that Cyprus doesn’t require companies to immediately set up a contract with their employees? Or that employee dismissal processes can be extremely complex? EORs will take care of this and so much more.
Contracts and Documentation
An EOR will handle the tedious administration involved in preparing and collecting contracts and documentation. This includes employment offers, signed contracts, banking information, and more so you can focus on growing your business.
Employee Insurance and Benefits
When the world is your competition, it pays to incentivize new and existing hires with attractive benefits like medical, dental, vision and life insurance, and retirement savings plans. A comprehensive EOR will have those kinds of benefits built into its service offering.
Vacation and Public Holidays
In Cyprus, full-time employees are entitled to 20 working days of paid time off annually. If they work for six days a week, they get 24 days per year. There are also several other types of leave to consider, such as maternity leave and paternity leave. An EOR can keep track of all this and the corresponding payments for you.
In addition, Cyprus has many statutory holidays that companies are obligated to provide to their employees.
- January 1: New Year’s Day
- January 6: Epiphany
- Sixth Monday before Palm Sunday: Clean Monday
- March 25: Greek Independence Day
- April 1: Cyprus National Day
- Friday and Monday of the Easter weekend: Easter (Orthodox Christian)
- May 1: Labor Day
- 50 days after Easter: Pentecost Monday
- August 15: Dormition of the Mother of God
- October 1: Cyprus Independence
- October 28: Ohi Day
- December 25: Christmas
- December 26: Boxing Day
Taxes
Employers in Cyprus pay a range of taxes and social security contributions, which amount to just over 14.9% of an employee’s salary on average. They are also required to contribute to the Redundancy Fund, the Human Resource Development Authority Fund, as well as the Social Cohesion Fund.
This can be a tedious process but is necessary to ensure you are paying employees in a compliant manner. Thankfully, an EOR can handle the logistics and ensure that payroll is processed correctly and per the regulations in whichever country you are operating.
What Are Your Responsibilities?
While an EOR handles everything related to legal and HR processes, many aspects of the company’s workings fall under your purview. So, you take care of your staff in the same way you would with your local hires. That means search and recruitment, company onboarding, training, management, day-to-day communications, progress tracking, and so on, should be managed by you.
While the relationship with the employee won’t be all that different through an EOR, you need to be clear with your staff on the legalities of their contracts. Of course, retention is also up to you. You will need to consider how you help your staff grow and succeed in their new roles at your organization.
What Are the Advantages of Going Through an EOR in Cyprus?
Using an EOR to hire talent in Cyprus will save you time, reduce costs, and mitigate risks.
Navigating the employment laws and regulations in Cyprus can be time-consuming and complex. Since an EOR is already set up to hire employees in the country, it will be faster and easier to start hiring right away. The process won’t differ very much from hiring locally.
Set-up and HR costs associated with independently hiring abroad can be quite high, so going through an EOR can save you money.
Most importantly though, you’ll be mitigating the risks associated with non-compliance. Because EORs have extensive experience in navigating complex employment and tax laws and regulations, you won’t have to worry about any issues arising.
How Do I Choose the Right EOR for Me?
There are a few key things to consider when you are selecting an EOR in Cyprus.
- Local Experience: Does the EOR have experience hiring in Cyprus? As discussed earlier, one of the biggest advantages of hiring an EOR is the assurance of compliance. Often, this requires a lot of experience, so check the EOR’s track record in the country.
- Service Scale: Do you need someone who offers a full suite of services? If you want happy employees that you can retain in the long run, then you may need to offer them benefits like insurance and other welfare. Some EORs have systems in place for this but others may not. Also, certain EORs will offer consulting services to optimize your global hiring practices.
- Data and Systems Security: Protecting intellectual property in a remote working environment is critical. Ensure your vendor of choice has a specific agreement outlining how they plan to keep your sensitive information safe and secure.
- Collaboration: Ensure your vendor’s approach to communication and collaboration with its clients is aligned with your organization’s approach. Love having a point of contact person? Perhaps all you need is access to a Slack channel so you can quickly reach your vendor. Whatever your communication style, ensure your vendor can meet your needs.
Borderless: The Employer of Record Your Company Needs
Need an EOR? Look no further than Borderless. We can help you hire employees in Cyprus – giving you access to a highly-skilled talent pool without the headaches of traditional global expansion.
Book a demo today and see how we can help you quickly and easily hire, onboard, pay, and retain the Cyprus-based talent your organization needs.
Disclaimer
Borderless does not provide legal services or legal advice to anyone. This includes customers, contractors, employees, partners, and the general public. We are not lawyers or paralegals. Please read our full disclaimer here.
